10 May 2006
Annual Report 2005 ready for Perstorp Holding AB, parent company of Perstorp
Financial development 1)
- Pro forma net sales rose 8% to SEK 6,299 m (5,849). The year was characterized by sharp increases in raw material prices, which created demand uncertainty. Price levels increased by an average of 9% during the year. Volumes declined by 3%, mainly for basic products and formalin projects. Currency effects had a favorable impact of 2%.
- Pro forma operating earnings before depreciation amounted to SEK 1,156 m (1,040). The sharply increased raw material prices led to lower margins for some products, which were offset by greater efficiency generated by the rationalization programs implemented during 2004 and earlier. Earnings for the year were impacted favorably by the dissolution of acquisition balance sheet reserves, SEK 49 m, while the comparative period was charged with rationalization costs totaling SEK 67 m.
- Comprehensive investments in capacity to meet stronger demand. The Perstorp Group completed and launched comprehensive investments during 2005 to increase production of several specialty chemicals products. A decision has also been made to invest in the production of potassium formate and rapeseed methyl esters (RME). As a result of the investments, the new Perstorp Group is well equipped to meet anticipated growing demand for existing and new specialty chemicals products.
1) The Perstorp Group proforma reflects the Group operations that PAI partners acquired at the end of 2005, meaning excluding the operations within Perstorp Compounds and Moldable Composites (Vyncolit) that were divested by Sydsvenska Kemi AB during the year. The acquired operation, Franklin, is included in full in the pro forma figures for both 2005 and 2004.