DSM shocks analysts with profit drop

Chemicals group DSM saw profit fall 14% in the final quarter of 2006, blaming higher fixed costs for the bulk of the decline. The group saw net profit of €119m, excluding extraordinaries – well below analysts expectations.

Sales were flat at €2.07bn.
A number of brokers immediately lowered their advice on DSM. ‘We had to contend with the lower dollar, unexpected stoppages for maintenance and higher spending on innovation,’ chairman Peter Elverding said.
Over the full year, operating profit was 6% higher on sales up 7%.

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