The German chemicals and metals group, Degussa, has recorded a significant increase in profits and sales in the first quarter of the 1996-97 accounting period. Pre-tax profits rose 20% in the three mo…
The German chemicals and metals group, Degussa, has recorded a significant increase in profits and sales in the first quarter of the 1996-97 accounting period. Pre-tax profits rose 20% in the three months to the end of 1996, on a 16% increase in sales. All divisions reported improved figures. Excluding the volatile precious metals business, turnover rose 6%. Foreign activities, particularly in the United States, aided growth. Like other German companies, Degussa said it was suffering from weak domestic demand. The chemicals division was expected to benefit from rising global demand, and its healthcare activities from last year“s US$ 350 million acquisition of Muro Pharmaceutical of the US. The figures were in line with market expectations although analysts pointed out that results looked impressive partly because of a particularly weak corresponding quarter in the previous year, when profits rose only 2% and sales, excluding precious metals, fell 10%. The company has reorganised its business around three main divisions – chemicals; healthcare and nutrition; and precious metals and banking. Degussa also gave further details of results for the year to the end of September 1996. The group achieved a net return on equity of 14.2%, bringing it closer to its target of 15%. Pre-tax profits in the chemicals sector rose 12% to DM 296 million (US$ 182.26 million), while profits in health and nutrition increased 20% to DM 226 million.