Total revenues for the Liquid Crystals division jumped 82% in the first quarter of 2010 to EUR 239 million from EUR 131 million in the year-ago quarter. With production costs remaining stable, the gross margin increased nearly three fold to EUR 163 million from EUR 56 million in the first quarter of 2009.
Liquid Crystals | Key figures – Q1 |
|||
|
|
|
|
EUR million |
1st quarter |
1st quarter |
Change |
Total revenues |
238.9 |
131.2 |
82.1 |
Gross margin |
162.7 |
55.7 |
192.3 |
Research and development |
–23.8 |
–22.2 |
6.9 |
Operating result |
111.8 |
12.7 |
– |
Exceptional items |
– |
– |
– |
Free cash flow |
103.6 |
25.3 |
308.8 |
Underlying free cash flow |
103.6 |
25.3 |
308.8 |
ROS in % |
46.8 |
9.7 |
|
These improvements are mainly due to the growing demand for Merck’s patented Polymer Stabilized Vertical Alignment (PS-VA) liquid crystal technology. Flat-panel televisions made with PS-VA liquid crystals have improved moving picture quality, faster switching times, higher contrast and brightness, and lower energy consumption.
PS-VA is quickly becoming the preferred technology for high-end displays, gradually replacing the Vertical Alignment (VA) technology, which Merck developed some years ago and which is now facing competition leading to price and market-share pressures.
Global shipments of liquid crystal display (LCD) televisions are expected to increase 24% to more than 180 million units in 2010, the market research organization DisplaySearch said in March. The organization stated that it had raised its earlier prediction by more than 10 million units due to the strong demand for LCD-TVs in 2009 – despite the financial crisis – and because of new technology introductions such as 3D displays and LED backlighting.
Merck’s Liquid Crystals division is already supplying LC materials for 3D vision glasses for 3D televisions. The division also makes phosphorus materials for LEDs (light-emitting diodes) under the brand name isiphor®.
Such technological advances are due to the division’s investment in research and development, which rose 6.9% to EUR 24 million in the first quarter of 2010.
The Liquid Crystals division’s first-quarter operating result rebounded to EUR 112 million compared to just EUR 13 million in the year-ago quarter. Likewise, the ROS soared to 46.8% from 9.7%.
The division’s free cash flow jumped to EUR 104 million in the first quarter from EUR 25 million in the year-ago quarter.
back
