Kemira sees improving 2002 profit

Finnish chemicals and fertilisers group Kemira reported falling 2001 profits the secon week of February due to weak markets and a rise in financial costs, but repeated its forecast for a rise in profi…

Finnish chemicals and fertilisers group Kemira reported falling 2001 profits the secon week of February due to weak markets and a rise in financial costs, but repeated its forecast for a rise in profits this year as demand recovers. “The operating profit for our three main units looks to be positive, and therefore the whole group looks to develop positively in the coming year,” Chief Executive Tauno Pihlava told a news conference following the firm“s result publication. “Production in the client industries that use pulp and paper chemicals is set to swing upwards towards the end of the year and this is expected to bring an increase in the consumption of chemicals,” Kemira said in a statement. Kemira posted a 2001 profit after financial items of EUR 113 million, well off the year-ago figure of 144 million and hit by a sharp rise in Finnish pension fund contributions as well as the weaker economic environment. “The slowdown in economic growth in 2001 overshadowed the Kemira group“s operating environment, especially within pulp and paper chemicals and industrial chemicals,” it said. Earnings per share fell 21% year-on-year to EUR 0.58, with sales flat at EUR 2.45 billion. The company proposed a dividend of EUR 0.30 per share, flat on 2000. The shares remain 33% above a 12-month low of EUR 5.30 hit in January after Finland did an about-face on plans to sell its stake to Sweden“s Industri Kapital because of domestic political resistance. In addition to the expected upturn in business in 2002, Kemira said it expected to reap the benefits from its purchases last year of US pulp and paper chemicals maker Vinings Industries and paint maker Alcro-Beckers of Sweden. Kemira said it saw synergies of EUR 5-10 million over this year and next from the Alcro-Beckers purchase. Group investments were seen flat-to-higher in 2002 on last year. The firm also said it was working on a new strategy, business focus areas and growth targets, with a statement to be made in the next few weeks. Pihlava said Kemira would remain active in making acquisitions in 2002.