Cinkarna Celje reports 60% higher half-year net profit

Celje – Cinkarna Celje, the Celje-based chemical company, saw its half-year sales revenue rise by 12% year-on-year to EUR 99.39 million on the back of good demand, boosting net profit by 60% to EUR 15.8 million.

Releasing the semi-annual results in a regulatory filing with the Ljubljana Stock Exchange, the company said the demand was favourable across the geographical regions owing to a general uplift in buyers’ confidence.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) amounted to EUR 26.6 million in the first six months of the year, equalling 27% of the sales, and rising by 50% compared with the same period a year ago.

“The most important elements of business success have been titanium dioxide pigment and streamlining the strategic portfolio to focus on core business and phase out unprofitable activities,” the company’s press release reads.

Although one of the smaller global players in terms of its capacity of titanium dioxide pigment production, the company says sectoral analyses show they are among the more successful in the field.

Apart from uncertainties related to the scheduled overhaul, growth in prices of raw materials and the impact of the Covid-19 outbreak, the company does not see any other substantial risks in the international area that could have any major effect on the company’s performance and plans.

In the second half of the year, they expect further increases in input and output prices. The company plans extensive regular maintenance, which between September and November is to have an impact on reduction of production and sales, increase in costs and consequently affect the bottom-line.

However, the management expects the target profit for the year to be trumped unless the Covid-19 situation or the situation on sales and purchasing markets deteriorate.

Cinkarna Celje spent EUR 4.1 million on capital expenditure in the first half of the year, or 28.7% of the planned figure for the year. The biggest lag from the plan is in investment from environmental provisions, which is blamed mainly on changed circumstances and extended paperwork and permit procedures.

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