The Management Board of Ciech SA has verified the strategy of Ciech Chemical Group for the next seven years and determined tasks for 2009. The plans assume further extension of the Group by acquisitions, integration reinforcement and better financial results. Considering difficult macroeconomic conditions, the goal for the current year is to maintain high production and sales levels and enhancement of the competitive position.
- Observing the development in the markets for the Group’s products, we look at 2009 with optimism. Initial estimates indicate that the results will be better than those forecasted for 2008 as regards revenues and net profit – said Ryszard Kunicki, the President of Ciech.
Updated strategy for the years 2009-2016
The reason for the update of the strategy of Ciech Chemical Group is the change of functioning conditions. The change includes dynamically changing market environment and new privatization strategy of the Great Chemical Synthesis on one hand, and on the other, external factors, such as acquisition programme completion, capacity increase, integration and reorganisation processes, and extension of Agro Division.
The most significant new components of the modified development strategy of Ciech Group is the purchase of Anwil, which will reinforce the Agro Division and extend the Group’s product portfolio. The strategy assumes also alternative scenarios tailored to different market conditions. Also, the concentration on organic investments (development and modernization investments) and the intensification of the integration of the Group’s companies, as well as releasing synergy play an important role in the strategy. The purchase of Anwil along with Azoty Tarnów and ZA Kędzierzyn will allow releasing the synergy in many areas of activity, which will influence the increase in the company’s value.
Ciech Group maintained the production and sales levels of the key products
The basic goal of Ciech Group for 2009 is to maintain the production of all installations. The danger of limitation of TDI production from Zachem, the second Group’s product after soda, generating 13% of annual sales revenues, that was real as early as several months ago, has been averted. The greatest producers were forced to close their TDI installations as a result of the crisis. The niche created in that way was successfully used by traders of Organika Division, including Bydgoszcz producer of that product. Some revival may be observed also in the Chinese market, which collapsed in October 2008.
Furthermore, the market for epoxy resin, the product of Organika-Sarzyna from Organika Division, which is ranked just after TDI in terms of risk during economic slowdown, is also reviving.
The Management Board of Ciech defined the risk areas several months ago – they include TDI and epoxy resins – and undertook steps to minimize the danger in those segments. Due to that, currently the company does not observe dangers within those key areas.
The situation of soda plants of Ciech group is stable. In 2009, the Soda Division will generate more than 40% of revenues. That segment bases on the slowdown of markets during the current crisis.
Currency options do not constitute a danger for Ciech
Ciech as the first one among Stock Exchange listed companies informed the market reliably about the negative influence of last year’s transactions involving currency options in the results of Ciech Chemical Group. The new Management Board has assessed the scale of the problem and verified the forecasted net profit for 2008. It informed about that the public opinion as soon as it was possible. The influence of currency options on the company’s financial results is monitored by the Management Board of Ciech on the on-going basis and the analyses made by the company indicate that those operations do not constitute a danger for the company’s functioning. Hedge accounting introduced as soon as in October has limited the negative influence on the company’s financial result. At the same time, it must be emphasized that Ciech’s revenues in euro considerably exceed items in options, which results in a positive effect of weakening zloty against euro on the Group’s revenues and results.
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press release download:  Good 2009 perspective for Ciech Chemical Group .pdf |
Ciech Chemical Group is the largest chemical concern in Poland and one of the leaders in the Central European market. It includes more than 30 companies, it is among one hundred largest economic organisations in Poland. The main Group’s products include soda Ash (second place in Europe), salt, phosphorus and multi-component fertilizers, plant protection chemicals, epoxy and polyester resins and other organic chemical products used in the glassmaking industry, furniture industry, building industry and agriculture. With annual revenues of approximately PLN 3.5 billion, Ciech Chemical Group is among one hundred largest Polish enterprises (49th position on “Lista 500” [“List of 500”] prepared by Polityka weekly magazine and 59th position on “Lista 500” prepared by Rzeczpospolita daily in 2007). As from February 2005, Ciech SA has been listed at the Warsaw Stock Exchange. The greatest shareholders of the company include the State Treasury (36.68 percent of shares and votes at the General Shareholders’ Meeting), Pioneer Pekao Investment Management SA (18.77 percent) PZU "Złota Jesień" Open Pension Fund (6.12 percent).
You can find more information at www.ciech.com.
Media contact:
Krzysztof Grad, spokesman of Ciech Chemical Group, director of Communication Office of Ciech SA,
tel.: (0 22) 639 13 18, mob.: 0 669 600 011, e-mail: krzysztof.grad@ciech.com |