TVK Q2 net profit slumped amid the economic difficulties of Europe

(bse) -- Tisza Chemical Group Public Limited Company (TVK Plc) has published its results for H1 2012 today. TVK is wholly owned by Hungary's MOL group.

In the second quarter of 2012, operating profit achieved was HUF 3.6 billion higher than in the previous quarter due to the favourable change of olefin feedstock and polymer product prices compared to each other and the reduced volume of energy used in connection with the general turnaround carried out in Q2.

The lower production and sales volumes as well as the exchange rate changes led to the deterioration of the operating profit, including the difference resulting from the re-valuation of accounts receivable and accounts payable in the previous and the actual quarter.

Operating profit of the first six month of 2012 declined year-on-year due to the lower integrated petrochemical margin, the unfavourable change of exchange rates, the significantly increased prices of natural gas, steam and electric energy and the lower production and sales volumes.

From end-May until end-July, TVK Olefin-1, HDPE-1, LDPE-2 and PP-3 plants were shut down for scheduled overhauls that the company carries out every three years.

According to company MRC, TVK is a significant player in market of polyolefins in Ukraine. In 2011, the company supplied about to 7% of PP and PE 6% of the total consumtion in the country, being N 4th among the producers of polyolefins in Ukraine. In the first half of this year, TVK has increased its PP market share to 10%. The market share of PE decreased to 5%. The company supplies to the Ukrainian market mainly the following grades: PP-Tipplen K499, Tipplen H145F, Tipplen K948; PE - Tipelin 6300B, Tipelin 7300B, Tipelin FS 471.

MRC

(Plastemart) -- Two producers restarted their ethylene crackers in Europe.

Repsol restarted its 410,000 tpa Sines cracker in Portugal after shutting it in early May. The cracker was scheduled to resume operations in early June initially, but the company faced some technical problems and had to delay the restart.

Also, PKN Orlen ended a six-week maintenance at its Plock cracker in Poland after shutting it in late June, said market sources, adding that the cracker can produce 700,000 tpa ethylene.
MRC

(Fibre2fashion) -- ESAI Energy’s 5-year Global Industrial Fuels Outlook concludes that the natural gas liquids (NGL) boom related to shale development will spur export oriented investment in petrochemical facilities.

Higher petrochemical exports from the U.S. will target the Latin American market. As a result of growing access to cheap ethane feedstock, U.S. ethylene is becoming more competitive in global markets given its feedstock price advantage over pricier naphtha.

Two new ethylene crackers are scheduled to come on stream between 2012-2016, and several existing plants are undergoing upgrades to absorb more ethane feedstock.

ESAI expects the annual surplus of ethylene derivatives to expand to over 4 million tons by 2016, a forty percent increase from 2011.

The natural target for U.S. petrochemical exports is the Latin American market, which is expected to face a continued shortage of ethylene derivatives. The emergence of the U.S. as a low-cost ethylene producer is therefore likely to deter, or further delay petrochemical invest-ment in that region.
MRC

MOSCOW (MRC) – Low buying activity in the Asian market keeps prices down despite the rise of oil and ethylene quotations. PE prices remained almost intact last week, except for LLDPE prices, report MRC analysts.

Last week there were mixed sentiments in the Asian PE market. Most converters were reluctant to replenish their stock inventories despite their restricted volumes. They prefer to wait for a more clear price trend. A steady growth of oil and ethylene prices do not make converters increase their PE purchases yet.

The price situation for September remains unclear. On the one hand, the rise of ethylene and oil prices will make Asian makers lift PE prices for September shipments. On the other hand, the demand for polyethylene is weak in the region and might hinder makers’ attempts to raise prices. The inflation rate in China has dropped to its 30-months’ bottom which gives certain optimism to market players. Market participants expect Chinese government to undertake measures to stimulate the economy, which, in its turn, might result in an increase in demand for polyethylene.

LDPE prices remained practically unchanged last week and varied in the range of USD1,250/tonne, CFR. Linear butane polyethylene grew in value by USD10-30/tonne. The deals were concluded at USD1,250-1,310/tonne, CFR. HDPE prices remained without significant changes and were at the level of USD1,280/tonne, CFR.
MRC

(portfolio) -- Hungarian oil and gas group MOL published much worse than expected figures for the second quarter of 2012 on Tuesday, mainly due to a disappointing performance in the Downstream and Gas Midstream segments.

The highlights of the earnings report are the following: EBIT hits new rock bottom, even below the 2008 low.
The cause was primarily the Downstream segment loss stemming from significant inventory revaluation losses and refinery maintenances.

The 12-month trailing Downstream EBIT shows a never-before-seen loss but adjusting for inventory revaluations and other one-offs Downstream profit was up in annual terms.

Profit dropped in Upstream too due to a decline in hydrocarbon prices and lower volumes. Loss of Petrochemical division moderated somewhat, but due to stronger maintenance activity and some unplanned stoppages the segment was unable to fully benefit from widening margins.

MOL Group is a leading integrated Central and East European oil and gas corporation with an extensive international Upstream and Downstream portfolio.
MRC