(Reuters) - Umicore <UMI.BR> reported better than expected first-half operating profit as it gained a greater share of the gasoline catalyst market, helping offset challenging market conditions in the automotive industry, sending its shares higher on Wednesday.
The Belgian materials and recycling group said it still expects its 2019 earnings to come to 475-525 million euros.
"Our operating performance and strong balance sheet enable us to forcefully pursue growth investments and R&D programs and to confirm our dividend policy," Chief Executive Marc Grynberg, said.
Umicore, supported by the ramp-up of capacity in Poland and China, expects to outperform the underlying market.
The company, one of the world's largest cobalt refiners, reported recurring earnings before interest and tax (REBIT) of 240 million euros (£219.92 million), boosted by higher revenues in the catalysis segment.
The company's performance in the first six months was boosted by market share gains in light duty gasoline applications, the growing penetration of gasoline particulate filters and growth in precious metals chemistry, it said in a statement.
By 0706 GMT, Umicore's stock was 8% higher at 28.01 euros.
Its shares have recently seen a string of price target and estimate cuts on concern the company could report weak results and reduce its full-year financial forecast.
The company warned on earnings in April citing tough market conditions and said earlier this month that a second fire incident in less than a year at its plant in northern Belgium would result in a 10 million euro operating profit hit.
It also said on Wednesday that it continues to face a temporary slowdown in demand for its cathode materials and has adjusted its capital spending to the current slower pace of growth.
(Reporting by Pawel Goraj, editing by Louise Heavens)