Rhodia, the scandal-hit French firm which employs 300 people at the former Albright & Wilson works in Oldbury, has halved its first quarter losses.
The speciality chemicals group said its would return to profit this year after restruc-turing. Net losses fell to £23.9 million from £50.5 million in the same quarter of 2005, helped by a return to profitability of its continuing operations.
"These results are very satisfying and show that the restructuring since the end of 2003 is bearing its fruits," chief executive Jean-Pierre Clamadieu said.
Profit from continuing operations was £6.1 million against a loss of £38.9 million a year earlier, but Rhodia said its discontinued operations weighed with a loss of £30 million against £11.6 million last year - partly reflecting the impact of the divestment of its pharmaceut ical custom synthesis business.
Earnings before interest, tax, depreciation, amortisation (EBITDA), restructuring and capital gains and losses, rose 8.8 per cent to £126.2 million on net sales up 9.4 per cent to £920 million, making for a recurring EBITDA margin of 13.7 per cent.
"Rhodia has reported a solid set of first-quarter data," said Citigroup analyst Ruth Lucas, noting though that most of the EBITDA outperformance was down to the "opportunistic" sale of excess electricity rather than a strong pick-up in its chemical business.
The operating profit rose eight per cent to £55.3 million.
The company whose products are used in the auto, electronics, tires, perfumery and consumer care industries said the sharp increase in raw materials and energy prices was partly offset by further price increases, the full impact of which is expected in the second quarter of 2006.
"The second quarter should be in line with the first one. Across all our markets, the situation is satisfying in terms of volumes and capacity to pass higher costs into prices," Mr Clamadieu said.
