MOSCOW (MRC) -- Air Products today reported net income down 9% year-on-year (YOY), to USD446.5 million, on sales down 7% YOY, to USD2.07 billion. Adjusted earnings fell 7% YOY, to USD2.01/share, slightly ahead of analysts’ consensus estimate of USD1.99/share, as reported by Refinitiv (New York, New York), said Chemweek.
COVID-19 reduced earnings by 35-40 cents/share, with a 3% YOY drop in volumes partly offset by a 2% increase in prices and cost cuts.
"Our onsite business—which represents more than half of our sales—remains stable, and we continued to execute on our growth strategy, announcing two new megaprojects in Saudi Arabia and Indonesia which together represent planned Air Products investment of approximately USD5.7 billion," says Air Products chairman and CEO Seifi Ghasemi.
Americas segment sales declined 11% YOY, to USD850 million, while segment adjusted EBITDA was roughly flat, at $411 million. Volumes fell by 5% YOY, largely due to lower merchant volumes on COVID-19, and energy pass-through was down 6%. Selling prices rose 2% YOY, boosting margins.
Asia segment sales fell 4% YOY, to $652 million, while segment adjusted EBITDA declined 2%, to USD327 million. Volumes fell 3% YOY, on COVID-19 impacts and maintenance outages at certain plants. Pricing grew 2% YOY, although margins declined.
EMEA segment sales decreased 13% YOY, to $430 million, while segment adjusted EBITDA was down 11%, to USD170 million. Volumes declined 7% YOY, due to lower merchant demand on COVID-19, and energy pass-through declined 6%. Prices grew by 3% YOY, although margins still fell.
As MRC reported earlier, in December 2014, SIBUR-Khimprom (a subsidiary of SIBUR Holding) and Air Products entered into an agreement to build a new air separation unit in Perm and to supply the facility with locally produced gases. The unit came on-stream in 2016. After the commissioning Air Products will supply industrial gases for SIBUR-Khimprom over the next 20 years.
Besides, we remind that in September 2019, SIBUR, the largest petrochemical comples in Russia and Eastern Europe, and BASF, Geman petrochemical major, agreed to closely cooperate on sustainable development to share their best practices.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 595,170 tonnes in the first five month of 2020, up by 10% year on year. Deliveries of all ethylene polymers, except for linear low density polyethylene (LLDPE), rose partially because of an increase in capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market was 457,930 tonnes in January-May 2020 (calculated by the formula production minus export plus import). Deliveris of exclusively PP random copolymer increased.
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