The company says that despite of the weakness compared to last year, there was a clear recovery in 2009 Q2 compared to Q1, and Chinese business regained momentum.
Net profit was down from €192 million in Q2 2008 to €10 million in Q2 2009.
| Q2 2009 | Q2 2008 | +/- | First half 2009 | First half 2008 | +/- | |
| Net sales | 1954 | 2456 | -20% | 3791 | 4814 | -21% |
| Operating profit (EBIT) | 79 | 276 | -71% | 136 | 513 | -73% |
| Net profit | 10 | 192 | -95% | 23 | 354 | -94% |
The Materials Sciences clusters (Performance Materials and Polymer Intermediates) were back in profit again, driven by improved demand, a continued focus on efficiency and some increase in margins. The Performance Materials cluster includes DSM Resins, DSM Engineering Plastics and DSM Dyneema. DSM Resins consists of DSM Composite Resins, DSM Powder Coating Resins, DSM NeoResins+, and DSM Desotech.
Performance Materials
In Performance Materials, sales were down 31% on the 2008 second quarter. Sales showed improvement against the previous quarter at DSM Resins and DSM Engineering Plastics. Construction and automotive related businesses remained slow.
The cluster reported an operating profit after two quarters of losses. Results of both DSM Resins and DSM Engineering Plastics improved from Q1 as demand improved. The operating profit for the quarter was down substantially against the same period last year due to the economic downturn, partially offset by lower raw-material costs as well as structural cost reduction programmes.
| Q2 2009 | Q2 2008 | First half 2009 | First half 2008 | |
| Net sales | 456 | 624 | 851 | 1225 |
| Operating profit before depreciation & amortisation | 44 | 90 | 50 | 191 |
| Operating profit | 17 | 70 | 0 | 150 |
Actions
In December 2008, DSM announced a number of cost-saving actions to address the effects of the economic downturn. These are being implemented and DSM says it will exceed the cost savings target of €125 million, to be fully achieved by 2010. These actions are expected to result in the loss of 1250 jobs. There will also be a stronger focus on purchasing and other efficiency improvement measures. DSM will also further cut the number of temporary workers.
In its capital expenditure DSM is prioritising projects focused on future growth while other projects are being postponed or delayed. At the same time, the company is actively looking for new growth opportunities that the current market and economic conditions will provide.
Outlook
DSM notes that there are indications that downstream de-stocking has come to an end in most markets, as shown by an overall improvement in demand compared to the first quarter. Demand is however still low compared to pre-recession levels. The exception to this is China, where DSM is seeing strong demand. Conditions in the USA and Europe are still weak. DSM expects no further improvements from current market conditions in the short term, with a risk of temporary lower demand during the summer.
In the Performance Materials cluster, DSM Engineering Plastics and DSM Resins still face uncertain demand.
DSM will provide no quantitative outlook for 2009 in view of the uncertain economic conditions.