Sales of Solvay decreased by 6% yoy in Q2 2016

MOSCOW (MRC) -- The sales of Belgian chemicals company Solvay Group decreased by 6% yoy in Q2 2016 to 2.946 billion EUR, due to net impact of foreign exchange fluctuations and price decrease, said the company on its site.

However, the sales volumes grew by 1% keeping the solid growing trend in last quarters. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) grew by 8% yoy to 652 million EUR, supported by sustained price increase. Also the group started benefitting from the continuous excellence projects and Cytec synergy delivery, as the EBITDA margin widened to a record 22% of net sales, representing a growth of 2.9 percentage points.

"Solvay posted strong results in the second quarter of 2016. We have delivered a record EBITDA margin of 22%. This reflects the quality of our portfolio, our continued achievements on excellence programs and the delivery of synergies stemming from integration of the Cytec legacy", said the CFO of Solvay Group, Karim Hajjar. “Cash flow in the quarter was also strong, due to better capital discipline, higher profits and further progress on working capital”, added he.

The company’s net income on IFRS basis grew significantly to 185 million EUR, against 138 million EUR in 2016. The free cash flow from continuing operations grew by 37 million EUR, due to higher EBITDA and stronger focus on cash generation. The contribution from discontinued operations was nil, since the European chlorovinyls was disposed mid 2015.

As MRC informed before, in the early June Solvay completed the purchase of Eastman Chemical Company's share in their former US joint venture Primester.

Solvay SA is a Belgian chemical company founded in 1863, employing 26,000 people in 52 countries. The company is world’s largest producer of Soda Ash and derivatives, as well as engaged in fuel cell technology, renewable feedstock and etc.
MRC

MOSCOW (MRC) -- Haldia Petrochemicals Ltd (HPL), once considered a ‘potentially sick’ firm, is set to post a three-fold increase of in its top line at Rs 10,000 crore for 2015-2016, said Business-standard.

Its revenue during 2014-15 was only Rs 3,097 crore, because its plants were shut from July 2014 to January 2015 due to acute cash crunch. In 2013-14, it earned Rs 8,130 crore though posting net losses.

“At this time, the economy is upbeat as we too are upscale and are utilising 95 per cent of the seven million tonnes of installed capacity,” a senior HPL official told Business Standard.

As MRC wrote before, IndianOil Corporation (IOC) is likely to call off its planned acquisition of the West Bengal government’s 40% in Haldia Petrochemicals Ltd (HPL) if The Chatterjee Group (TCG) chief Purnendu Chatterjee is appointed HPL chairman.

Haldia Petrochemicals Ltd is a modern naphtha based petrochemical complex at Haldia, West Bengal, India. Haldia has played the role of a catalyst in emergence of more than 500 downstream processing industries in West Bengal with a capacity to process more than 3,50,000 TPA of polymers, among which are polyethylene (PE) and polypropylene (PP).

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MOSCOW (MRC) -- Clariant, a global specialty chemicals producer headquartered in Muttenz, Switzerland, announced the availability of new blowmolding tools that can help customers evaluate how Clariant color and additive masterbatches perform in real-world applications, said Plasticstoday.

The tooling is available for use on full-size production blowmolding machines located in the company’s technical center in Chicago. The new single-cavity tool, which is intended for reheat stretch blowmolding of clear or colored PET polyester resins, produces a 12-oz. (355-ml) round bottle with a long neck and curved sides. The design is intended to reflect current trends for liquor bottles, but can also be used to evaluate wine, soft drink and other food and beverage containers, as well.

"This new mold includes the details that customers told us they wanted in prototype tooling,” explained Peter Prusak, Head of Marketing, Clariant Masterbatches North America. “The tooling we’ve had in the past produced flask-shaped bottles, and the broad, flat panels were not as representative of the shapes that producers of liquor bottles and other beverage containers are looking for today."

The tooling can be used to evaluate not only color, but also performance-enhancing additives and barrier properties, as well. Prusak says that the way plastic materials stretch to create a bottle’s shape can vary depending on the color and other ingredients in the compound. A resin/masterbatch combination that works well in one shape can develop cosmetic flaws or unacceptable physical properties in another. This is why it is so important to produce shapes that more accurately mimic the actual end-product containers.

In an interview with PlasticsToday, Prusak noted that purchasing tooling for customers to use in material tryouts is a "unique proposition" that has real value for the company’s customers.

Clariant worked with a few of its customers to design the mold, which is a typical aluminum two-stage blow mold. Clariant can make products for both pellet and liquid masterbatch so that customers know how their product will look with a liquid color carrier.

When asked about plans for putting equipment and prototype molds in any of its other facilities, Prusak said that currently the capabilities are in Chicago because the company’s Color Works design center is there, making it a natural fit for the tech center. However, there is some consideration being given to installing something similar in the company’s Chino, CA, facility.

As MRC informed earlier, Clariant announced first half 2016 sales of CHF 2.899 billion compared to CHF 2.871 billion in 2015. This corresponds to a 3 % growth in local currency driven by higher volumes.
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MOSCOW (MRC) -- Sumitomo Chemical plans to construct a new production facility for polyethersulfone (PES) engineering plastic at its Chiba Works in Ichihara City, Chiba, Japan. The new facility will have a production capacity of 3,000 tonnes per year, said Plasticstoday.

Commercial production start-up is slated for in 2018. When the facility becomes fully operational, Sumitomo Chemical's total production capacity of PES, combined with the existing facility in its Ehime Works in Niihama, Ehime, will grow two-fold.

PES is a thermoplastic resin with excellent properties in terms of its heat resistance, dimensional stability, flame resistance, and hot water resistance.

Sumitomo Chemical’s Sumikaexcel PES has a long-standing track record of supply to the market as an additive that confers toughness to carbon-fiber reinforced plastics (CFRP) based on epoxy that are widely used in fuel-efficient aircraft. It is also used in dialysis membranes and automotive applications.

CFRP components in aerospace applications are toughened by the addition of PES resin. In addition to solid demand growth projected for aircraft CFRPs and dialysis membranes, Sumitomo Chemical believes PES is likely to find increased demand in automotive applications in the future.

To meet such increased demand and also mitigate risk, the company decided to locate the new plant it its site in Chiba, Eastern Japan, rather than on the island of Shikoku in Western Japan where the existing plant is located.

Solvay is another supplier of PES resin for toughening applications with its Virantage PESU product range. The company has collaborated with Korea's Hankuk Carbon Co. to improve the toughness, heat resistance and processing consistency of a carbon fiber-reinforced thermoset composite prepreg.

Solvay produces produce sub-75 micron PESU powder at a plant in Panoli, India, that was expanded in 2013.

As MRC informed earlier, Sumitomo Chemical will build naphtha storage tanks and a wharf where large ships transporting the feedstock can dock at a petrochemical plant in Singapore.
MRC

MOSCOW (MRC) -- The founding family of Japan's Idemitsu Kosan Co. bought a stake in Showa Shell Sekiyu KK, in a bid to block Idemitsu management's billion-dollar plan to take over the rival oil refiner, the family's lawyer said Wednesday, reported Reuters.

The family said differing corporate cultures preclude any synergy from a merger. In its latest effort to dissuade management, the family bought 0.1% of Showa Shell, the family's lawyer, Takujiro Hamada, told a news conference.

The amount is enough to complicate and draw out any takeover by raising the prospect of a tender offer, Hamada said.

Idemitsu, as part of a takeover plan, agreed to the private purchase of Royal Dutch Shell PLC's 33.2% stake in Showa Shell.

With the family's 0.1% purchase, Idemitsu and related parties' stake in Showa Shell would exceed a third. By law, Idemitsu would therefore have to launch a formal takeover bid that would likely attract interest from other Showa Shell shareholders eager to sell at a high price, Hamada said.

The government wants consolidation among Japan's eight refiners as a shrinking population and an increase in fuel-efficient vehicles crimps demand.

But honorary chairman and former president Shosuke Idemitsu is driving the opposition to the takeover of Showa Shell by the company founded by his father. He argues that Idemitsu's ties to Iran are incompatible with Showa Shell's close relations with rival Saudi Arabia, Kyodo news agency reported last month.

Idemitsu was the first Japanese firm to buy Iranian oil in the 1950s, while Showa Shell is 15% owned by state-controlled Saudi Aramco.

Idemitsu's management does not need shareholder approval to buy Royal Dutch Shell's stake, but the founding family owns enough of Idemitsu to veto any post-purchase integration at a shareholder meeting expected later this year.

"This was done to re-confirm (the family's) opposition to the merger and to swiftly resolve the issue," Hamada said of the family's Showa Shell purchase. "We're not trying to bully them."

Talks between Idemitsu and its founding family failed to resolve an impasse over the oil refiner's proposal. The two sides will not be able to hold further discussions since that could be construed as insider trading now that the family owns Showa Shell shares, Hamada said.

As MRC wrote before, Japanese refiner Idemitsu Kosan Co. and smaller rival Showa Shell Sekiyu announced in April 2016 that they would merge on April 1 next year. Japan's No.2 and No.5 refiners by revenue agreed last November in a deal worth approximately USD4 B to create the nation's second-biggest refiner sometime between October 2016 and April 2017.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.

Idemitsu Kosan is a Japanese petroleum company. It owns and operates oil platforms, refineries and produces and sells petroleum, oils and petrochemical products. The company runs two petrochemical plants in Chiba and Tokuyama. The two naphtha crackers can produce up to 997,000 tonnes of ethylene per year.
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