Clariant announces strong sales growth for first quarter

Clariant announced first quarter 2022 continuing operations sales of CHF 1.262 billion, compared to CHF 1.002 billion in the first quarter of 2021, said the company.

This corresponds to a particularly strong increase of 30 % in local currency and 26 % in Swiss francs. The positive pricing impact of 16 % in part addressed continued cost inflation and also slightly outpaced the volume growth of 14 %. Care Chemicals and Natural Resources grew sales at an accelerated pace, which more than compensated for the expected slightly weaker development in Catalysis.

All geographic regions contributed meaningfully to the sales expansion in the first quarter of 2022, reflecting both continued strong demand as well as supply chain shortages. In Europe, the high 27 % local currency growth was underpinned by strong expansion in Care Chemicals as well as Natural Resources. Sales in Asia-Pacific rose by 31 %, underpinned by expansion in all Business Areas and clearly driven by 34 % higher sales in China. The Americas reported compelling growth as North American sales increased by a resounding 37 %, followed closely by Latin America at 31 %. In the Middle East & Africa, sales rose by 26 %.

In the first quarter of 2022, Care Chemicals increased sales by 44 % in local currency. This progress was supported by double-digit expansion in both Consumer Care and Industrial Applications, in particular Personal Care, Crop Solutions, Aviation, and Coatings. The consolidation of the acquired majority share in Clariant IGL Specialty Chemicals (CISC) and the acquisition of the remaining shares in Beraca further supported this positive development with an addition of 4 % local currency volume growth for the Group. Catalysis sales decreased by a slight 1 % in local currency, despite significantly higher Specialty Catalysts sales, which could not entirely counterbalance the weakness in parts of Petrochemicals and Syngas. Natural Resources sales increased by a resounding 31 % in local currency with growth attributable to all three Business Units, especially Additives.

The continuing operations EBITDA increased to CHF 220 million with a corresponding margin of 17.4 %, slightly exceeding the 17.3 % reported in the first quarter of the previous year. The increase was underpinned by operating leverage from higher sales, cost savings (CHF 4 million savings from efficiency programs), and pricing measures, which largely offset raw material price increases, supply chain constraints, and higher energy and logistics cost. The absolute EBITDA increased by a notable 27 %.

Clariant’s Pigments business was divested to a consortium comprising Heubach Group and SK Capital Partners on 3 January 2022, which resulted in a provisional pretax disposal gain of CHF 168 million and an EBITDA of CHF 160 million for discontinued operations. Total Group (continuing operations and discontinued operations) EBITDA was CHF 380 million in the first quarter of 2022.

Clariant aims to grow above the market to achieve higher profitability through sustainability and innovation. The Group concluded the final step in its significant portfolio transformation in January of 2022. Clariant is now a truly specialty chemicals company and confirms its 2025 ambition to deliver profitable growth (4 – 6 % CAGR), a Group EBITDA margin between 19 – 21 %, and a free cash flow conversion of around 40 %.

In the second quarter of 2022, Clariant expects to generate continued strong sales growth in local currency versus the prior year, underpinned by expansion in all Business Areas despite a normalizing growth environment. Sequential sales are expected to decline moderately as a result of seasonal impacts (aviation, refinery) and demand normalization in Care Chemicals and Natural Resources. Clariant expects to improve on its restated year-on-year margin levels in the second quarter of 2022. Sequentially, the Group expects to be broadly in line with its first quarter 2022 margin level, especially via operating leverage from growth, continuing pricing actions, and cost discipline to counter continued inflation in raw materials, logistics, labor, and energy cost.

For the full year 2022, Clariant expects strong growth in local currency for the Group, driven by a particularly strong first half of 2022. The current high level of uncertainty resulting from the geopolitical conflicts, suspension of business with Russia, and the resurgence of COVID-19 in China are expected to continue to impact global economic growth and consumer demand in the second half of the year. Clariant expects the high inflationary environment with regard to raw material, energy, and logistics cost as well as supply chain challenges to persist in the second half of 2022. Clariant aims to improve its year-on-year Group EBITDA margin levels via solid revenue growth driven by pricing and continued cost discipline, despite the increasingly challenging economic environment.

Lummus Technology announced it and its catalyst partner Clariant have been awarded a major contract by Fujian Meide to supply CATOFIN technology and catalysts for a new, world-scale propane dehydrogenation (PDH) unit in Fuzhou, China. Already operating one PDH unit at its Fuzhou petrochemical complex, Fujian Meide is now building one of the largest PDH units in the world and has selected the CATOFIN process and catalysts for the project's second phase. The new unit will produce 900,000 mtons of propylene annually and is scheduled to commence operation in 2023.
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thyssenkrupp Industrial Solutions’ subsidiary Uhde Inventa-Fischer signed a contract to build new world-scale polymer plants for MERINOS HALI SANAYI VE TICARET A.S., Turkey, said Hydrocarbonprocessing.

The plant will use Uhde Inventa-Fischer’s proprietary patented MTR (Melt-to-Resin) technology to produce 330,000 tpy of resin for the production of PET bottles as well as bright chips for textile applications.

Ali Erdemoglu, Chairman of Merinos Hali San. Ve Tic. A.S.: “The foundations of the companies and brands of Erdemoglu Holding, which have become a giant company by adding new ones to its achievements day by day, were laid in 1970. Merinos Hali, one the major group of companies of Erdemoglu Holding, will secure his international quality standard and global leadership in the carpet industry with its state-of-the-art production facilities. It is an honor to cooperate with UIF for our growth strategy."

Werner Steinauer, CEO of Uhde Inventa-Fischer: “We are very proud that Merinos chose us to build a MTR plant for bottle grade and textile application. Scope of delivery for all plants includes basic and detail engineering, delivery of all necessary components, technical services regarding plant erection as well as supervision of erection and commissioning."

MTR – a cost-effective solution for producing high-quality PET resin The MTR process eliminates the SSP (solid-state polycondensation) and leads to substantial energy savings. It reduces investment, operating and maintenance costs, has a higher raw material yield and results in products of superior quality. The MTR process is based on Uhde Inventa-Fischer’s proprietary 2-Reactor technology which uses the patented ESPREE and DISCAGE reactors to obtain the desired high melt viscosities.

As per MRC, Thyssenkrupp suspended its 2021/22 forecast for free cash flow before mergers and acquisitions for due to the Ukraine crisis and said it was unclear if it would still be able to spin off its steel division, said the company.
Although the group’s sales from Russia and Ukraine are negligible at significantly less than one percent of total sales, the Executive Board estimates that the group’s business performance will be impacted by the far-reaching macroeconomic and geopolitical consequences of the war in Ukraine. The Executive Board currently assumes that the global disruptions at various points in the supply chain will affect above all thyssenkrupp’s steel and automotive supply businesses. Opposing developments in materials trading, which is benefiting from the current increase in raw material and material prices, and the countermeasures initiated will not be able to fully compensate these impacts.
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Braskem Idesa's new partner in a USD400 MM investment in an ethane import terminal in Mexico will be Advario, part of the storage and logistic infrastructure company Oiltanking, Braskem said on June 14, said Hydrocarbonprocessing.

Construction is scheduled to begin in July and end in 2024. The venture is majority owned by Sao Paulo-based Braskem with Mexico?s Idesa group as minority partner. Braskem and Idesa have been partners since winning in a consortium a tender for a long-term contract to buy ethane from Mexico?s Pemex about 12 years ago. The Puerto Mexico Chemical Terminal, as the ethane import terminal project will be called, will create 2,000 jobs during construction, the company has said.

The site will be connected to Braskem Idesa?s polymer complex through an 11-kilometer pipeline. Braskem Idesa built the Nanchital complex to produce ethylene based on the contract to purchase the ethane feedstock that it had won in public bidding.

Braskem Idesa?s ethylene and polyethylene complex in Nanchital has capacity to produce 1.1 MMtpy of polyethylene. It needs imported ethane because Mexican ethane production declined over the past decade and Pemex cannot supply enough feedstock to run the plant at capacity. The Nanchital plant has not run at capacity since completion in 2016.

A new jetty will also be built with an exclusive area for operations with cryogenic ethane, the company said. Advario's portfolio comprises world-scale storage terminals located strategically in key hubs across the globe, Braskem Idesa said.

Braskem had said in its first quarter earnings call that it planned to make an announcement of a partner by June. The Braskem investment is the biggest current foreign private investment in Mexico. Braskem started to import ethane from the U.S. around the first quarter of 2020 but it is limited in the volumes that it can import due to logistics constraints that will be solved with the new terminal.

Ethane, fractioned from natural gas, is the raw material for the ethylene that is polymerized into the polyethylene material most commonly seen as plastic supermarket bags or milk jugs.

As per MRC, Braskem S.A. informs its shareholders and the market that its indirect subsidiary Braskem Idesa has entered into agreements with Advario B.V for the sale of a 50% stake in Terminal Quimica Puerto Mexico, a subsidiary of BI responsible for the development and operation of the ethane import terminal Project in Mexico.

As per MRC, Braskem (Sao Paulo, Brazil) said it is supporting the efforts by Danish company Plastix (Lemvig) to market recycled plastics fibre waste of old fishing nets and other marine debris collected at various ports.

As per MRC, Braskem has agreed with Dutch recycler Terra Circular to enter a joint venture for mechanical recycling.
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Shell Retail and Convenience Operations LLC, a wholly owned subsidiary of Shell Oil Products US, has completed the acquisition of certain company-owned fuel and convenience retail sites from the Landmark group of companies, said Fuelsandlubes.

The acquisition also includes supply agreements for the independently operated fuel and convenience sites. Building on the strength of its existing networks, this acquisition brings Shell closer to its customers and enhances Shell’s market presence by growing its mobility footprint in a key region in the U.S., which is one of the largest fuels and convenience retail markets in the world.

On October 26, 2021, Shell announced it had reached an agreement to purchase the Landmark fuel and convenience network. The agreement has been adjusted to remove 64 company-owned Landmark sites, which currently sell ExxonMobil branded fuels, as well as removing fuel supply agreements for nine dealer-owned sites, which currently sell Chevron and Texaco branded fuels. There is no change in the agreement for sites within Texas Petroleum Group, LLC (TPG), previously a 50-50 joint venture between Equilon Enterprises LLC (d/b/a Shell Oil Products US) and Landmark Industries Holdings, Ltd.

TPG will be a wholly owned subsidiary of Shell Retail and Convenience Operations LLC, within Shell’s Downstream Mobility business. More than 1,400 Landmark team members enable Shell to grow its company-owned network in the U.S. Shell, through wholesalers, dealers, and JV partners, currently own and operate more than 13,000 Shell-branded sites across the U.S.

With this acquisition, Shell is advancing its Powering Progress strategy in three ways: by growing its retail footprint in a core market; by providing opportunities to offer customers expanded fuelling options, including electric vehicle charging, hydrogen, biofuels and lower-carbon premium fuels, and by allowing for the growth of non-fuel sales through an enhanced convenience offering.

As per MRC, Shell is building larger vessels that can carry more carbon dioxide over longer distances as part of the company's plans to expand its carbon capture storage (CCS) business globally. The ability to ship large volumes of CO2 from industrial sites to offshore CCS hubs is critical in improving the economies of scale for these projects. CCS is aimed at decarbonising heavy industries such as refining, cement and steel.

Shell is a British-Dutch oil and gas concern engaged in the extraction, processing and marketing of hydrocarbons in more than 70 countries.
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LyondellBasell announced its board of directors has declared a special dividend of USD5.20 per share and a quarterly dividend of USD1.19 per share, said the company.

The quarterly dividend represents a 5 percent increase over the company's first quarter 2022 dividend. The special and quarterly dividends will both be paid on June 13, 2022 to shareholders of record as of June 6, 2022, with an ex-dividend date of June 3, 2022.

"LyondellBasell established new records for cash generation in 2021 and we have a strong outlook for our company. Capital returns have always been an important component of LyondellBasell's value proposition for shareholders. 2022 will mark our 12th consecutive year of regular dividend growth. The combination of today's special and quarterly dividends returns $2.1 billion to shareholders. As the incoming CEO, I would like to make it very clear that I support the continuation of our balanced and disciplined capital allocation strategy with both dividends and share repurchases playing a central role," said Peter Vanacker, CEO of LyondellBasell.

"As a management team, we are confident that strong markets for our products and accretive growth underway from investments in our asset base will continue to provide significant cash generation. Our investment-grade balance sheet, disciplined approach to growth and focus on safety, sustainability and circularity provide a powerful foundation for advancing LyondellBasell's leading positions over the coming years," said Vanacker.

As per MRC, LyondellBasell announced that Levima Green (Shandong) Advanced Materials Co., Ltd. will use LyondellBasell’s Lupotech T high-pressure polyethylene technology at a new site. The Lupotech T process technology will be used for a 200 kiloton per year (KTA) vinyl acetate copolymer (EVA) line. The new line will be located in the Zaozhuang City, Shandong Province, P.R. of China.
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