German blender Fuchs’ Q4 profit slips

German lubricant blender Fuchs Petrolub saw its profit fall in the three months to end-December as costs rose faster than sales.

Profit before interest and tax fell by 24pc from the same period a year earlier to €84mn ($93mn). Profit of €363mn in 2021 rose by 16pc from €313mn the previous year.

Fourth-quarter profit fell even as sales of €742mn in the fourth quarter rose by 16pc to a record high. Sales got a boost from an increase in volumes sold, and from higher selling prices in the second half of the year.

The higher prices partly reflected a surge in raw material costs during the year. These fed into a surge in costs that rose by 28pc in the fourth quarter and by 25pc for the full year.

Tight availability and strong demand triggered a surge in global base oil prices in 2021, especially in the first half of the year.

Group I prices corrected lower in the second half of the year. But Group III prices especially remained unusually high even as prices for other grades fell.

Fuchs anticipated raw material costs would remain elevated in 2022.

The blender’s profit margin edged down to 11.3pc in the fourth quarter. The margin was down from 12.3pc during the previous three months and the lowest since second-quarter 2020.