Rhodia hikes annual outlook on strong Q1 results
French chemical group Rhodia on Thursday raised its annual outlook as surging demand from emerging markets boosted its first quarter profits to a record high.
Net income more than doubled in the first quarter to a record high of 151 million euros ($220 million) from the previous year and EBITDA up 28 percent to 243 million euros, the group said. Sales rose 28 percent to 1.50 billion euros.
"Our pricing power, differentiated geographic positions and recent acquisitions all contributed effectively to the quarter strong momentum," Rhodia CEO Jean-Pierre Clamadieu said in a statement.
"Global economic growth should remain strong throughout the year, driven by sustained demand, especially in fast-growing countries," the group said.
Rhodia expects to continue delivering a strong performance and now anticipates its full-year EBITDA to exceed one billion euros.
The company had said in February that it expects a 5-10 percent in recurrent EBITDA from the 905 million euros it recorded in 2010.
Belgian rival Solvay is making a friendly takeover bid for Rhodia worth 3.4 billion euros to create a world leader in the chemicals and plastics, which the group said may open in mid-June and conclude in late July.
"This excellent performance reinforces our confidence in our project to create with Solvay a major player in the chemical industry, determined to carry out an ambitious growth strategy," said Clamadieu.
Growth was particularly robust at Rhodia's consumer chemicals and advanced materials businesses that include rare earths, and the group's ability to pass on higher prices generated a net positive impact of 51 million euros in the first quarter.
Rhodia is "capable of defending its margins in a context of inflation in raw materials and energy," Clamadieu separately told French daily Le Monde.
Company shares closed up 0.37 percent to 31.59 euros, outrunning a market that ended down 0.95 percent
© 2011 AFP