In 2008, companies in Europe increased sales by 12.6% to €38,652 million. The economic situation in the region has deteriorated since the second half of 2008. This development greatly intensified at the end of the year as a result of low consumer spending and significant export losses.
In the Chemicals segment, sales increased in all three divisions, in some significantly, although business declined in the fourth quarter.
In the Plastics and Performance Products segments, sales matched the previous year’s level. The increase in sales, which was significant for some businesses, during the first three quarters was offset by the sizeable decline in business in the fourth quarter.
Sales decreased in the Functional Solutions segment, in particular as a result of the drop in demand from the automotive and construction industries in the fourth quarter. The expansion of the business in Eastern Europe could not compensate for the decline in demand in Western Europe.
Sales in the Agricultural Solutions segment increased due to higher volumes and prices.
As a result of higher prices and volumes, sales in the Oil & Gas segment were significantly higher than in 2007.
At €5,822 million, income from operations was substantially higher than in 2007. The Oil & Gas segment, which posted considerably higher earnings compared with the previous year, made the greatest contribution to the increase in earnings.
We adapted structures and processes to changing market conditions in our project “Further Development of the European Organization,” which we successfully concluded in 2008. In order for our service structures to remain competitive in the future, we have started additional projects in the past few months: They encompass our services in the areas of administration, procurement and production, and are parts of the global program NEXT, which focuses on more excellence in the day-to-day business.
We continued to expand our European Shared Services Center (ESSC) in Berlin, Germany. Here, we combine finance and accounting functions as well as standard human resource services under one roof.