Press releases

The CIECH Group achieved good financial results thanks to its foreign expansion and cost control

The CIECH Group - being determined in the implementation of a strategy of product portfolio development, international expansion and strict cost control - achieved sound financial results in the first quarter of 2018. Revenues amounted to 885.7 mln PLN, and adjusted EBITDA (adj.) amounted to 167.6 mln PLN. In the first quarter of the current year, foreign sales were developed intensely – in the soda segment CIECH took advantage of the stable demand in Europe and the good situation in Asian markets, and in the AGRO business, it started sales in new markets, e.g. in Australia and Canada. During the first months of 2018, the Group used the completed investments which contributed to the effectiveness of individual business lines, and continued the process of development of its product portfolio.

  • The consolidated revenues of the CIECH Group for the first quarter of 2018 amounted to 885.7 mln PLN  (drop by 1.4% yoy).
  • Adjusted EBITDA (Adj.) amounted to 167.6 mln PLN (drop by 10.2% yoy), and the net profit to 74 mln PLN (drop by 5.4% yoy).
  • Net debt/EBITDA (Adj.) ratio amounted to 1.3 at the end of the first quarter.
  • The results were positively affected by intensive sales activities conducted in the market of soda ash in Asia, where CIECH took advantage of the good market situation. The sales of resins, foams and salt were also higher, where, in addition to higher sales volumes, higher sales prices (per annum) were also noted.
  • The Group reduces the negative impact of high prices of materials used in production by, inter alia, substitution of coke, used as furnace fuel, with anthracite.
  • During the first quarter, the results were negatively influenced by exchange rates (the strengthening of PLN towards EUR and of RON towards USD).
  • In the following quarters, CIECH will continue to implement its investments (such as extending the product portfolio, also thanks to its R&D activities, salt, resins or AGRO business development) and expansion to new markets. The Group will also continue to exercise strict cost discipline and take care about high quality and production efficiency.

“During the first quarter of 2018, we took advantage of the situation in the Asian market of soda ash, where we witnessed significant changes of prices. In the context of the following quarters, good news is great demand for soda ash in all markets in which we operate. At the same time, we reduce the negative impact of persisting high prices of materials. We are glad about the growing sales of salt, and resin, foam or silicates sales results which are better than a years ago. This is both the effect of completed investments, and the undertaken product portfolio optimization activities. In 2018, we will commission next investments, very important for the CIECH Group – e.g. new products in the salt business. We also face work on the construction of a new saltworks in Germany and operational integration with Spanish company Proplan” says Maciej Tybura, President of the Management Board of CIECH S.A.

In the soda segment, the CIECH Group took advantage of higher prices in the Asian market caused by lower local production. CIECH is performing the contracts for 2018, selling soda to approx. 500 locations all over the world. The demand for soda may be generated by the expected investment of flat glass producers (Europe), package glass and detergent producers (Asia). In addition, in Europe, we can observe high utilization of the soda ash production capacity, combined with continued high level of demand. At the same time, the CIECH Group implements investments in increasing the baking soda production capacity – in the spring, construction work commenced in the German plant of the Group. The completion of the work is planned in the first half of 2019.

As regards the salt segment, both prices of ready products and the sales volume proved to be higher than a year ago. During the first quarter, a salt product warehouse was commissioned for use in Janikowo, facilitating customer service

The organic segment noted a drop in revenues caused by a poorer market situation in the sector of crop protection protection. This is a result of long winter, delaying the start of the season. Meanwhile, in the Resins and Foams businesses, higher volumes of sales were noted, resulting from the development of new products, obtainment of new clients (Resins) and a strong demand on the part of furniture producers (Foams).

In the Silicates and Glass segment (CIECH Vitrosilicon), higher revenues and growth of EBITDA (Adj.) result were noted. Thanks to a large demand for sodium silicate, with the CIECH Group being the largest supplier thereof in Europe, an investment was completed during the first quarter which consisted of a switch of one of the furnaces from the production of glass packaging to production of silicates. In addition, CIECH extended its portfolio in the area of glass packaging.

“We intensify our development activities in every sector, turning the CIECH Group to a global chemical concern. We focus on specialized products, high effectiveness and the quality of production, at the same time efficiently managing the cost aspect. CIECH has healthy financial foundations and a precisely-drawn development plan for the next years, taking into account good prospects in the main markets of its operation. That is why, being a company listed on the stock exchanges in Warsaw and in Frankfurt, we decided to recommend to the General Meeting the payment of a dividend, considering not only the sound result of 2017, but also the results of 2016 and a good situation in the basic markets of our operations,” says Maciej Tybura, President of the Management Board of CIECH S.A.

Below is a table with the basic data concerning the results of the CIECH Group for the first quarter.

[mln PLN]1Q20181Q2017change y/y 
EBIT Margin 11,5%14,1%-2,6 p.p.
EBITDA Margin18,7%20,8%-2,1 p.p.
EBITDA (A)167,6186,7-10,2%
EBITDA (A) Margin18,9%20,8%-1,9 p.p.
Net result74,078,1-5,3%
Net margin8,4%8,7%-0,3%

Mirosław Kuk, CIECH Group Spokesperson, tel. +48 723 66 86 86.

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