Swiss EMS Chemie H1 sales drop 8.1%, cuts 2024 sales guidance (updated)
12/07/2024 09:32
(Adds analyst comments in paragraphs 3, 8, 10, share move in
paragraph 2)
July 12 (Reuters) - Swiss nylon manufacturer EMS Chemie
EMSN.S cut its 2024 sales guidance on Friday after reporting
weaker-than-expected first-half sales, citing currency effects
as the Swiss franc strengthened.
The stock slumped 6.5% as of 0750 GMT, heading for its worst
day since April.
Net sales in the first half of the year declined 8.1% to
1.09 billion Swiss francs ($1.22 billion), EMS said, which,
according to Vontobel analyst Sibylle Bischofberger did not meet
consensus estimates.
The company said it now expects its 2024 net sales to fall
slightly, after previously forecasting net sales in line with
the 2023 figure of 2.19 billion Swiss francs.
EMS Chemie forecast the economic environment would continue
to be difficult in 2024, adding there was no sign of any growth
impulse in global manufacturing.
"New political regulations and penal customs duties are also
unsettling consumer confidence and hampering companies'
investment decisions," the company said in a statement.
The mood in the European chemical industry remains cautious
as the sector has long been suffering from weak demand and high
production costs.
Bischofberger said the company's specialty product portfolio
is less affected by the challenging situation, but added that
EMS Chemie "cannot escape market developments".
The company reaffirmed its full-year earnings before
interest and tax (EBIT) outlook and still sees a figure slightly
above previous year's 493 million francs.
Analysts said EMS Chemie's margins had improved
significantly, helped by higher volumes and after expanding in
Asia, America and Europe.
EMS Chemie kicked off the earnings reporting season for
European chemical makers, with peers such as Clariant CLN.S ,
K+S SDFGn.DE and Givaudan GIVN.S set to report their
quarterly results in the coming weeks.
($1 = 0.8958 Swiss francs)
($1 = 0.8955 Swiss francs)
(Reporting by Marta Frackowiak and Bartosz Dabrowski in Gdansk
Editing by Ludwig Burger and Sharon Singleton
)
((
marta.frackowiak@thomsonreuters.com; +48 58 7696530;
bartosz.dabrowski@thomsonreuters.com; +48 58 7696560))