UPDATE 1-Wacker Chemie Q2 profit beats view on solar price recovery
* Wacker Chemie Q2 EBITDA 229.5 mln eur vs 221 mln Rtrs poll
* Says demand for polysilicon has continued to grow
* Raised outlook last week (Adds details on results, bullets, CEO quote, industry context)
FRANKFURT, Aug 1 (Reuters) - German specialty chemicals maker Wacker Chemie said its core profit rose by more than a fifth in the second quarter, driven by a recovery in prices and demand for polysilicon, its most important product, which is needed to make solar cells.
Wacker Chemie said on Friday its second-quarter earnings before interest, tax, depreciation and amortisation (EBITDA) reached 229.5 million euros ($307.2 million), beating the 221 million average analyst forecast in a Reuters poll.
"Demand for solar silicon has continued to grow and prices have stabilised," Chief Executive Rudolf Staudigl said in a statement. "The current business trend in our divisions and our order level for the second half of the year make us even more optimistic that 2014 will be a good year for Wacker."
Wacker Chemie is the world's second-biggest maker of polysilicon, a key ingredient needed to produce solar cells, ranking behind Hemlock Semiconductor, a joint venture between Dow Corning and Shin-Etsu Handotai.
Manufacturing a wide range of products, Wacker Chemie also supplies raw material for half of the world's chewing gum.
Wacker Chemie last week raised its full-year core profit forecast for 2014, citing strong demand for its key product polysilicon, cost cuts as well as retained advance payments from customers in the solar sector, whose contracts were either cancelled or restructured.
It confirmed core earnings would rise by at least a third this year, which equates to EBITDA of at least 905 million.
Sales are still expected to rise by a mid-single digit percentage from last year's 4.48 billion euros, the company said. According to Thomson Reuters Starmine, which weights estimates of analysts based on their track record, sales are expected to increase 8.2 percent in 2014 to 4.85 billion euros.
Shares in Wacker Chemie have gained about 9 percent since the beginning of the year, driven by a slight recovery of polysilicon prices, which have gained by about a fifth since the beginning of last year after nearly halving in 2012.
The massive decline came after a supply glut of modules and cells threw the solar industry into a deep and structural crisis over the past five years, hurting many of Wacker Chemie clients in the sector.
South Korea's OCI Co Ltd and China's GCL-Poly Energy Holdings, which also compete with Wacker in the production of polysilicon, have seen their shares decline by 14 percent and gain by 5 percent, respectively.
GCL-Poly said last week it expected a net profit of no less than HK$800 million ($103.2 million) in the first half of the fiscal year, compared with a net loss of about HK$917 million in the year-earlier period.
($1 = 0.7471 Euros)
($1 = 7.7498 Hong Kong Dollars) (Editing by Maria Sheahan)
- Qatar adamant it will host 2022 World Cup despite doubts
- Argentina's Fernandez to meet billionaire investor Soros in New York
- New Jersey hiker killed by black bear : police
- Islamic State urges attacks on U.S., French citizens, taunts Obama
- Housing data hits Wall Street; S&P has worst day since August 5 |