Welcome to LANXESS Annual Report 2012!

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Focus on organic growth

We aim to generate about two-thirds of our future growth organically – by expanding existing production facilities and increasing investment in new state-of-the-art sites, through product innovations and, last but not least, through further improvements in process efficiency. Clear rules have been defined for all growth projects: they must generate a return that is at least equivalent to LANXESS’s return on capital employed (ROCE).

In fiscal 2012, cash-relevant capital expenditures totaled €696 million. Around two-thirds of this was for measures to expand capacities and raise efficiency. We have also budgeted capital expenditures of €650 million to €700 million for 2013. A large part of this will be allocated to the Performance Polymers segment. However, our other two segments also have attractive growth prospects for which we initiated a number of promising projects.

Chart: Capital expenditure projects
We have initiated major capital expenditure projects in all our regions in order to achieve further organic growth. The map shows projects announced in 2012 and projects still in implementation at the closing date.

Performance Polymers segment

  • The Butyl Rubber business unit is constructing a state-of-the-art butyl rubber facility in Singapore. Costing some €400 million, this is the largest investment project in the history of LANXESS. Hot-commissioning will start in the first quarter of 2013.
  • Close by, the Performance Butadiene Rubbers business unit is investing some €200 million in a new production plant for Nd-PBR. This plant is scheduled to come on stream in the first half of 2015.
  • In Changzhou, China, the Keltan Elastomers business unit is investing €235 million in the world’s largest production plant for EPDM rubber. This is also scheduled to start up in 2015.
  • To strengthen the High Performance Materials business unit's high-tech plastics activities, a new world-scale facility for polyamide plastics is under construction at our site in Antwerp, Belgium. This is scheduled for completion in the first quarter of 2014. Additional production capacities for glass fibers will also be available in Antwerp in spring 2013.
  • A new compounding plant in Porto Feliz, Brazil, will enable our High Performance Materials business unit to supply high-tech plastics to the Latin American market.

Advanced Intermediates segment

  • Through 2013, the Advanced Industrial Intermediates business unit will be expanding production capacities for the high-quality intermediate cresol at the site in Leverkusen, Germany.

Performance Chemicals segment

  • With the construction of a new facility at Ningbo, China, the Inorganic Pigments business unit will significantly expand capacities for its range of light-colored iron oxide red pigments. This is expected to come on stream in the first quarter of 2015.
  • Starting in the first half of 2013, the Leather business unit will be supplying premium products to China, the world’s largest market for leather chemicals, from a new facility in Changzhou, China.
  • Also, by the end of 2013, a new CO2 concentration plant will make the Leather business unit independent of external suppliers at its site in Newcastle, South Africa, and pave the way for the future expansion of sodium dichromate production.
  • In Lipetsk, Russia, the Rhein Chemie business unit is constructing LANXESS’s first production facility in that country to supply additives and release agents to the rubber processing and tire industries there.
  • Rhein Chemie is also building a production plant for high-quality curing bladders and rubber additives in Porto Feliz, Brazil, which should start operating in the second quarter of 2013.

Further information about these projects and the activities successfully completed before the editorial deadline for this Annual Report can be found in the segment sections.

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