Clariant sees slight 2022 sales drop on uncertain outlook

By Linda Pasquini

(Reuters) -Swiss specialty chemicals maker Clariant said on Thursday it expects annual sales to drop slightly in 2023 as it anticipated a soft recession in the first six months of the year though it forecasts an economic recovery in the latter half.

It also expects a net negative impact of around 130 million Swiss francs ($138 million) from divestments and a bolt-on acquisition as well as an increasing annualized hit related to operational issues at its bioethanol Sunliquid plant in Romania.

The company's shares fell as much as 5% before paring losses to trade 3.2% down by 1102 GMT.

Clariant, whose chemicals are used in personal and home care products, said it expects 2023 sales of around 5 billion Swiss francs, down from 5.198 billion a year earlier.

It reported full-year core profit (EBITDA) of 810 million francs, up 14% from a year earlier but below estimates for 815 million by analysts in a company-gathered consensus.

Jefferies analysts noted that the company's guidance implies 2023 EBITDA of around 800 million francs, below the 835 million Swiss francs estimated by analysts in a company-provided poll.

Clariant said it aims to improve reported group core profit margin level in 2023 amid a persisting inflationary environment, as it expected an ongoing recovery in its catalysts business to offset lower sales volumes in its other units.

Catalyst sales rose 18% in local currency in the fourth quarter.

The company sees energy costs edging up in 2023 compared to a year earlier.

In recent months, Clariant managed to offset raw materials and energy costs hitting the industry by passing them on to customers through price increases.

After raising prices by 17% in the last year, Chief Executive Officer Conrad Keijzer said on a media call that Clariant was aiming to maintain them, forecasting a slight margin expansion in case raw material costs eased further than expected.

"In the fourth quarter of 2022, pricing continued to have a significant positive impact on sales growth and EBITDA margin, despite softer end markets in some businesses," he said in an earlier in a statement.

($1 = 0.9410 Swiss francs)

(Reporting by Linda Pasquini and Marta Frackowiak; Editing by Christopher Cushing, Sonia Cheema and Emelia Sithole-Matarise)