Kemira Oyj - Interim report (Q1 and Q3)

Kemira Oyj's interim report January-June 2011: Profit before tax improved, guidance unchanged

Kemira Oyj
Stock exchange release
July 28, 2011 at 8.30 am (CET+1)

Disclosure procedure
Kemira Oyj follows the disclosure procedure enabled by Standard 5.2b published
by the Finnish Financial Supervision Authority and hereby publishes its interim
report January-June 2011 enclosed to this stock exchange release. Kemira's
interim report January-June 2011 is attached to this release in pdf format and
is also available on the company's web site at www.kemira.com.

Second quarter:


  * Revenue was EUR 548.8 million (545.2).
  * Operative EBIT decreased 8% to EUR 37.3 million (40.5) and the margin to
    6.8% (7.4%).
  * Profit before tax increased 9% to EUR 40.7 million (37.3).

January-June:

  * Revenue increased 4% to EUR 1,105.6 million (1,059.9).
  * Operative EBIT increased 3% to EUR 82.2 million (79.6) and the margin was
    7.4% (7.5%).
  * Profit before taxes increased 29% to EUR 89.3 million (69.0).
  * Earnings per share from continuing operations increased 26% to 0.44 (0.35).
  * Gearing improved to 37% (39% as of December 31, 2010).
  * Outlook for 2011 remains unchanged from the January-March 2011 Interim
    report.


Kemira's President and CEO Harri Kerminen:"Raw material prices continued to increase during the second quarter and
together with higher freight and energy costs, had a negative effect on the
operative EBIT. However, higher revenues from increased volumes and implemented
sales price increases could fully offset the higher variable costs. Divestments
made in the latter part of 2010 and currency exchange effects brought our
operative EBIT below last year's level. Despite lower EBIT, our profit before
tax increased due to higher income from associated companies and lower financial
expenses.

Kemira's revenue grew nearly 7% in the second quarter, excluding the negative
effect from divestments and currency exchange. The Paper segment's organic
revenue growth was more than 6% and the operative EBIT margin remained on a good
level. The Oil & Mining segment continued to show steady growth rates,
especially with oil and gas business in North America.

The Municipal & Industrial segment's operative EBIT margin was negatively
affected by higher raw material costs. In the municipal water treatment
business, the average time between the change in raw material prices and in our
sales prices is longer than in Kemira's other businesses.

Kemira owns a minority stake (39%) in Sachtleben, a major titanium dioxide
producer. The performance of Sachtleben continued to be very strong.

Manufacturing facility projects in China and India are proceeding according to
plan. The manufacturing facility in India will be operational during the second
half of 2011. The new facility will produce water treatment chemicals for
municipal and industrial customers in the Indian market. The facility in China
is expected to be operational in the second quarter of 2012. Additionally in
July, Kemira bought the remaining shares (49%) in Kemira Tiancheng Chemicals
Co., Ltd, further strengthening our position in China.
Looking ahead, we expect that the implemented sales price increases will deliver
positive results in the second half of the year. Outlook for the full year
remains unchanged."

Key figures and ratios
The figures for 2010 are for continuing operations excluding Tikkurila, unless
otherwise stated. Tikkurila Oyj was separated from Kemira on March 26, 2010.

                         Apr-Jun 2011 Apr-Jun 2010 Jan-Jun  Jan-Jun Jan-Dec 2010
EUR million                                           2011     2010

Revenue                         548.8        545.2 1,105.6  1,059.9      2,160.9

EBITDA                           61.1         68.3   129.5    131.1        265.7

EBITDA, %                        11.1         12.5    11.7     12.4         12.3
--------------------------------------------------------------------------------
Operative EBIT                   37.3         40.5    82.2     79.6        162.3

EBIT                             37.3         44.5    82.2     82.9        156.1
--------------------------------------------------------------------------------
Operative EBIT, %                 6.8          7.4     7.4      7.5          7.5

EBIT, %                           6.8          8.2     7.4      7.8          7.2
--------------------------------------------------------------------------------
Financial income and             -3.9         -9.8    -7.7    -17.7        -27.4
expenses
--------------------------------------------------------------------------------
Profit before tax                40.7         37.3    89.3     69.0        137.9
--------------------------------------------------------------------------------
Net profit from                  31.7         27.3    69.6     55.0        115.9
continuing operations
--------------------------------------------------------------------------------
Net profit                       31.7         27.3    69.6 586.0***     646.9***
--------------------------------------------------------------------------------
EPS, EUR, from                                        0.44     0.35
continuing operations            0.20         0.17                          0.73
--------------------------------------------------------------------------------
Capital employed*             1,684.1      1,631.7 1,684.1  1,631.7      1,665.1

ROCE, %*                         10.4          8.8    10.4      8.8          9.9
--------------------------------------------------------------------------------
Cash flow after                                       85.9  134.6**
investments                      65.2          1.9                       168.6**
--------------------------------------------------------------------------------
Capital expenditure              20.1         18.5    34.5     32.5        107.8
--------------------------------------------------------------------------------
Equity ratio, % at                                      55     50**
period-end                         55         50**                          54**
--------------------------------------------------------------------------------
Gearing, % at period-end           37         48**      37     48**         39**
--------------------------------------------------------------------------------
Personnel at period-end         5,065        5,177   5,065    5,177        4,935

* 12-month rolling average
**Includes Tikkurila until March 25, 2010
***Net profit January-December 2010 includes a non-recurring income of EUR
529.2 million from the separation of Tikkurila, consisting of the difference
between the market price of Tikkurila on March 26, 2010 and the shareholder's
equity of Tikkurila on March 25, 2010 less the transfer tax related to
Tikkurila's listing as well as the listing costs.

Definitions of key figures are available at www.kemira.com > Investors >
Financial information. Comparative 2010 figures are provided in parentheses for
some financial results, where appropriate. Operating profit, excluding non-
recurring items, is referred to as Operative EBIT. Operating profit is referred
to as EBIT.
Outlook (unchanged)

Kemira's vision is to be a leading water chemistry company. Kemira will continue
to focus on improving profitability and reinforcing positive cash flow. The
company will also do investments to secure the future growth in the water
treatment business.

Kemira's financial targets remain as communicated in connection with the Capital
Markets Day in September 2010. The company's medium term financial targets are:

  * revenue growth in mature markets > 3% per year, and in emerging markets >
    7% per year
  * EBIT, % of revenue > 10%
  * positive cash flow after investments and dividends
  * gearing level < 60%.


The basis for growth is the growing water chemicals markets and Kemira's strong
know-how in water quality and quantity management. Increasing water shortage,
tightening legislation and customers' needs to increase operational efficiency
create opportunities for Kemira to develop new water applications for both new
and current customers. Investment in research and development is a central part
of Kemira's strategy. The focus of Kemira's research and development activities
is on the development and commercialization of new innovative technologies for
Kemira's customers globally and locally.

Kemira expects the volume recovery that was seen in 2010 to continue in 2011 and
Kemira's revenue is expected to be slightly higher than in 2010. Despite the
rising raw material prices, Kemira expects the operative EBIT in 2011 to be
higher than in 2010.

Press conference and conference call


Kemira will arrange a press conference for analysts and the media on Thursday,
July 28, 2011 starting at 10.30 am at Kemira House, Porkkalankatu 3, Helsinki.
In the conference, Kemira's President and CEO Harri Kerminen will present the
results. The press conference will be held in Finnish. Presentation material
will be available on Kemira's website at www.kemira.com under Investors in
English and at www.kemira.fi in Finnish at 10.30 am.

A conference call in English will begin at 1 pm Finnish time. In order to
participate in the call, please dial +44 (0)20 7162 0025, code 900184 ten
minutes before the conference begins. Presentation material will be available on
Kemira's website. A recording of the conference call will be available on
Kemira's website later the same day.


For more information, please contact


Kemira Oyj
Tero Huovinen, Director, Investor Relations
+358 10 862 1980


Kemira is a global two billion euro chemicals company that is focused on serving
customers in water-intensive industries. The company offers water quality and
quantity management that improves customers' energy, water, and raw material
efficiency. Kemira's vision is to be a leading water chemistry company.

www.kemira.com
www.waterfootprintkemira.com


[HUG#1533963]

Attachments:

Link to the Interim report January-June 2011 (.pdf).pdf