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* FY core profit seen approaching 1 bln euros
* Guidance beat, driven by recycling and catalysis
* 2021 volume rise in battery business confirmed
* Shares hit two-and-a-half-year high
(Adds details from call, analyst comment)
By Pawel Goraj
April 22 (Reuters) - Belgian materials technology and
recycling group Umicore beat full-year guidance
expectations on Thursday, spurred by high precious metal prices
and strong demand, sending its shares 7% higher.
The group sees adjusted earnings before interest and tax
(EBIT) for the year approaching 1 billion euros ($1.2 billion),
significantly higher than expected for 2021 and reported last
year.
"We're in very good shape to sustain these levels of margins
and profitability for awhile," Umicore's Chief Executive, Marc
Grynberg said on a call with analysts.
Umicore's recycling business has benefited the most from
higher prices, particularly for rhodium, with the new outlook
incorporating on a like-for-like basis an exceptional additional
contribution of roughly 250 million euros compared to 2020.
Driven by increased market share in the Chinese and European
light-duty gasoline market and the evolution of the sales mix in
Europe, where diesel has declined relative to gasoline engines,
the catalysis unit is expected to more than double adjusted
earnings, the company said.
Grynberg also anticipated volume growth in the rechargeable
battery materials business as the automotive industry recovers
in Europe.
Umicore, which competes with Britain's Johnson Matthey
and Germany's BASF, said adjusted earnings
would be higher in the first half of the year than in the second
and added that the new guidance assumes no deterioration in
demand in the automotive industry.
Output will be affected in the second half by planned
maintenance at Hoboken in Belgium, one of the world's largest
precious metals refining sites, Umicore said.
Analysts also said precious metals price volatility could
have a bearing on earnings.
"It would not be wise to extrapolate the current precious
metals pricing bonanza into the longer term future," KBC said in
a note.
Umicore, which is due to publish first quarter results on
April 29, reported EBIT at 536 million euros in 2020.
($1 = 0.8310 euros)
(Reporting by Pawel Goraj. Editing by Himani Sarkar, Mark
Potter and Barbara Lewis)
