Ciba’s textile woes lead to loss
Ciba Specialty Chemicals has posted a net loss of SFr256 million ($199 million) for 2005, after setting aside SFr583 million for restructuring its textiles unit.
The Swiss chemicals giant said net profit would have been SFr364 million, down three per cent from 2004, if restructuring and other charges had not been taken into account.
“2005 has been the most challenging year for the company since its foundation,” Ciba Speciality Chemicals chief executive Armin Meyer commented in statement on Tuesday.
Sales for the year rose six per cent to SFr7.419 billion. The company said this reflected sales price increases, strong growth in the Asia Pacific region and the acquisition of Raisio Chemicals. The region now represents 29 per cent of Ciba sales.
Ciba, which makes a range of chemicals for the plastics, water and paper treatment industries, said it was making good progress on restructuring its textile effects division, which has long been suffering as a result of Asian competition.
Meyer said that a final decision regarding the division would be made “in the next few months”.
Total energy related cost increases amounted to SFr40 million and those relating to higher social benefit costs were SFr60 million. The company has initiated efforts to mitigate these increases, Ciba said.
For 2006, the Basel-based firm said it saw sales higher than in 2005 in local currencies. But it said it was unable to make a profitability forecast due to uncertainty relating to the textiles unit.
Ciba added that it would propose a dividend of SFr3 per share for 2005 at the company’s AGM on March 2. This is unchanged from the previous year.
swissinfo with agencies
Ciba SC has reported a net loss of SFr256 million for 2005 (from a SFr306 million profit in 2004).
Sales were up 6% at SFr7.419 billion.
A dividend of SFr3 per share is being proposed (unchanged).
Ciba Speciality Chemicals is one of three companies created by the merger of Ciba-Geigy and Sandoz in 1996, along with Novartis and Syngenta.
The group supplies dyes and pigments to textile, car, cosmetic, plastics, paper and construction industries.
Basel-based Ciba SC employs around 19,000 people on 80 sites in 28 different countries.
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