Industry CPH struggles with volatile markets

CPH posted slightly lower sales and a slightly lower operating profit in its continuing operations in the first half of 2024. And the markets remain volatile, according to the figures.

Specifically, net sales from continuing operations fell by 6.9 percent to 176.9 million Swiss francs, according to a statement issued on Thursday. The operating result at EBITDA level fell by 9.6 percent to 30.2 million Swiss francs and the corresponding margin to 17.1 percent from 17.6 percent. Net profit is estimated at 21.1 million francs after 31.9 million francs.

These figures are for CPH excluding the paper and real estate business. The former CPH Chemie+Papier Holding AG was split into the CPH Group (chemicals and packaging) and Perlen Industrieholding AG (paper) at the end of June 2024.

Chemistry grows, packaging declines

The two divisions remaining with CPH - Chemicals (Zeochem) and Packaging (Perlen Packaging) - performed differently in the first half of the year. The Chemicals Division increased its sales by 7.7 percent, while the larger Packaging Division suffered a decline of 13.3 percent.

As expected, the very high order backlog 2023 in the Packaging division returned to pre-coronavirus levels in the first half of the year, according to the press release. The reduction of safety stocks at customers and a decline in demand for food supplements led to lower sales.

Paper in the red

Including the paper business, the figures look different. This suffered a 12.1 percent drop in sales and posted a negative operating result (EBITDA, before spin-off effects) of 5.6 million Swiss francs due to persistent price pressure and rising material and energy costs. According to the information provided, there were also non-cash expenses of 22.3 million francs from the spin-off.

Including these effects, the bottom line was a loss of CHF 8.7 million, compared to a profit of CHF 60.7 million in the previous year.

Black figures expected

However, according to the press release, the management expects to be in the black for the year as a whole, even including this effect. Apart from this, the economic outlook is "cautiously positive". However, they remain volatile.

EBITDA in the mid double-digit million range is expected in continuing operations. In the medium term, however, the opportunities for growth in continuing operations are good. With Zeochem (chemicals) and Perlen Packaging (packaging), the Group is very well positioned with strong brands to benefit from above-average growth opportunities in international niche markets.