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LANXESS Sets Ambitious Growth Target
Leverkusen, Dusseldorf — LANXESS announced on Sept. 15, 2010 its goal toincrease its leading earnings indicator by roughly 80 percent in thecoming five years. The specialty chemicals company is targetingEBITDA pre exceptionals of approximately EUR 1.4 billion in 2015 and confirmed its forecast of roughly EUR 800 million EBITDA pre exceptionals in 2010. LANXESS plans to achieve its mid-termearnings target through a dual-track growth strategy of organic and external growth.

Organic growth will play the more dominant role.“We are poised to enter a new era of growth and have set anambitious target, which we can achieve based on the strategicposition of our business portfolio,” said LANXESS CEO, Axel C.Heitmann, at the Group’s fourth Media Day in Dusseldorf. “Our trackrecord reflects our operational strength. By the end of this year, wewill have increased EBITDA pre exceptionals by roughly 80 percentsince 2004, in spite of the global economic crisis.”LANXESS’ businesses benefit from their focus on premium productsserving the four megatrends of mobility, agriculture, urbanization andwater.

The company’s BRIC strategy and the expected growth of itsleading customer industries will help each of its businesses to generate an EBITDA compound annual growth rate of at leastfive percent through 2015. The percentage of group sales in BRICcountries has more than doubled in the last five years.

Dual-track growth strategy

As the world’s leading synthetic rubber company, LANXESS iscapitalizing on the megatrend of mobility. The tire market is LANXESS’ largest customer industry, with an expected annualgrowth rate of roughly five percent up to 2015.In order to meet this growing demand, LANXESS is constructing anew EUR 400 million butyl rubber plant in Singapore that willpredominantly serve the booming tire market in Asia.

In addition, LANXESS is expanding its world-scale butyl rubber plant in Belgium.LANXESS is the leader in rubber for the high-performance,environmentally friendly “green tire” market - the fastest growingsegment in the tire industry, with an annual global growth rate ofabout 9.0 percent. As a result, the company is expanding itsproduction capacities in Germany, USA and Brazil for neodymiumpolybutadiene rubber (Nd-PBR), which is essential in the productionof high-performance tires.

Furthermore, it is considering building a new production plant forNd-PBR in Asia, with a capacity of 100,000 to 150,000 metric tonsper annum. A feasibility study is currently under way, and a finaldecision on the project will be made within the next six months.LANXESS is addressing the megatrend of mobility also through itshigh-tech plastics Durethan and Pocan, which help make cars lighterand more fuel-efficient.

Growing demand for these products hasprompted the company to expand production in Wuxi, China, and to build a new plant in Jhagadia, India.Other investment projects have been launched to serve themegatrends of agriculture, urbanization and water. One prime example is the investment in a new production facility in Bitterfeld,Germany, for membrane filtration technology. It will enable thecompany to offer a new class of water treatment products by 2011.

In addition, a new ion exchange resin plant at the Jhagadia site will startproduction at the end of this year to meet the growing demand forwater purification in Asia.Simultaneously, LANXESS will continue to explore external growthopportunities to strengthen the existing business portfolio.

LANXESSCFO Matthias Zachert stressed that the current focus is on small tomedium-sized acquisitions similar to the transaction size of pastacquisitions. Zachert added that both organic growth projects and acquisitions must adhere to strict financial criteria.

LANXESS is a leading specialty chemicals company with sales of EUR 5.06 billion in 2009 and currently around 14,400 employees in 23 countries. The company isrepresented at 42 production sites worldwide. The core business of LANXESS is thedevelopment, manufacturing and marketing of plastics, rubber, intermediates and specialty chemicals.

For further information concerning LANXESS chemistry in our WebMagazine athttp://webmagazine.lanxess.com




 

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