Brussels — Umicore’s revenues were slightly down compared to the first half of 2013 as a result of volume growth being offset by strong metal price and currency headwinds. Recurring EBIT was down 15 per cent due to lower metal prices, currency headwinds and higher depreciation charges, partly offset by cost reductions. Considering the demand and price trends observed in the key end-markets and assuming current metal prices and exchange rates remain unchanged for the balance of the year, Umicore expects its full year recurring EBIT to be within the upper half of the previously stated range of € 250 – € 280 million.
Revenues for the business group were up by 3 per cent with an increase in Automotive Catalysts in contrast to lower revenues in Precious Metals Chemistry. Recurring EBIT was 7 per cent lower due to a lower contribution from Precious Metals Chemistry. In the second half of the year the ramp up of HDD catalyst production and the new Euro 6 contracts for light duty diesel catalysts should start contributing to revenues and EBIT.
Revenues were up year on year and earnings started to recover from the low levels of the second half of 2013. Global car production rose by 4 per cent with a further recovery of the European and North American markets and continued strong growth in China.
In Europe, Umicore’s revenues and volumes for light duty catalyst sales were flat year on year due to a temporarily unsupportive platform mix; new contracts for Euro 6 light duty diesel catalysts will help Umicore’s sales in the region resume their growth trajectory. The European car market continued its recovery and was up by 5 per cent. Production of HDD catalysts at Florange is ramping-up according to schedule. The construction of a third HDD line in Florange is on track and production is set to start by the end of this year. Umicore will start the construction of a new catalyst facility in Nowa Ruda, Poland for both light- and heavy-duty diesel catalysts that meet new European emission legislation. Completion of this new facility is planned for early 2016.
Precious Metals Chemistry
Revenues for the business unit declined compared to the same period last year. This was largely due to lower order levels for precursors used in catalytic applications, particularly in the Brazilian automotive market. Demand for precursors used in non-catalytic applications remained at a similar level to the previous year. Demand for organic compounds used in the bulk chemical and life science sectors was also stable. Sales of API’s (Active Pharmaceutical Ingredients) continued to show good growth and the business unit successfully secured new contracts in this segment.
Rechargeable Battery Materials
Revenues and sales volumes increased year on year. The continued rise of new applications using Li-ion batteries, such as home appliances is generating further growth in the total market.
The largest market segment for Li-ion technology remains portable electronics despite somewhat decreasing growth rates in the first half of 2014. The demand for automotive applications is steadily increasing with the introduction of new car models and the gradually increasing sales of previously introduced models.
Umicore further increased its shipments of LCO (lithium cobaltite) for use in high-end portable electronics such as smartphones and tablets benefiting from its diversified product and customer base. The proprietary High Energy LCO Cathode Material technology extended further in the portable electronics segment and is expected to be the basis for upcoming technological improvements.
Overall sales of NMC (nickel manganese cobalt) cathode materials were down year on year as a result of lower deliveries of standard grades used in traditional notebook PCs. This is in line with Umicore’s strategy to reduce its presence in this highly competitive segment. The ordering pattern for NMC used in automotive applications continued to be somewhat erratic and price pressure increased as a result of overcapacity at several main Li-ion cell producers.
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