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Lonza Underlying Revenue Up 5.6% In 2011; Announces CEO Transition - Update

Chemical and biotechnological supplier Lonza Group (LZAGF.PK) on Wednesday reported growth in underlying revenue and EBITDA for 2011 at constant exchange rates due to high capacity utilization in most business units. Further, the company's board has decided to change chief executive Stefan Borgas. Chairman Rolf Soiron will co-ordinate the Management Committee during the transition.

Before the recent acquisition of Arch Chemicals, revenues grew 5.6 percent at constant exchange rates to 2.505 billion Swiss francs. Foreign exchange had a negative impact of 84 million francs. EBIT before acquisition was 292 million francs.

The Custom Manufacturing business continued to benefit from demand for outsourcing from pharmaceutical and biotech companies, while the Microbial Control business saw a slowdown in established markets from the third quarter of the year.

The Board of Directors proposed a cash dividend of 2.15 francs per share for 2011. The Lonza Board will be increased from seven to eight members. Margot Scheltema and Dr. Jörg Reinhardt were proposed as new Board members, while Dame Julia Higgins would leave the board.

In 2012, the acquisition of Arch is expected to deliver overall earnings growth that would translate into significant earnings per share growth as well.

Commenting on the change of CEO, Rolf Soiron, Chairman of the Board of Lonza, said, "...continuous change characterized the past years and Stefan Borgas has led this process as Lonza's CEO...In the challenging years ahead Lonza will enter a period of focus and improvement of return of capital. This led the Board of director's to the decision to initiate a change of CEO. As Chairman of the Board I will lead the Management Committee during the transition."

The stock closed in Zurich on Tuesday lower by 0.24 percent at 61.20 euros on 192,652 shares.

by RTT Staff Writer

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