Indorama Ventures Limited (IVL)’s second-quarter sales and earnings before interest, taxes, depreciation, and amortisation (EBITDA) rose sharply, year on year, on the back of strong sales volumes and improved profit margins, said the company.
Net profit, which the company reports in its home currency, more than doubled during the quarter to baht (Bt) 20.3bn (USD571m). IVL said it had managed to offset high energy prices in Europe and the US thanks to the “combination of strong sales and improved margins".
By division, the company said its largest unit producing polyethylene terephthalate (PET) and derivatives had posted 35% higher earnings during Q2, year on year, though they fell by 1% quarter on quarter. “[The division, called Combined PET] delivered strong EBITDA … on high margins driven by seasonally strong demand, supply chain constraints and overall market tightness,” said IVL.
IVL’s Integrated Oxides and Derivatives (IOD) division also posted higher earnings, both year on year and quarter on quarter. However, sales and earnings fell year on year and quarter on quarter in the Fibers division as it took a hit from China’s lockdowns to contain the pandemic as well as disruption in Russia.
We remind, seasonally strong demand, supply chain constrains, overall market tightness and production in key locations like the US has driven Indorama's polyethylene terephthalate (PET) business to a 35% year-on-year growth. As a domestic producer in western premium markets, the heightened freight rates and longer lead times for imported goods allowed Indorama to re-price domestic sales at attractive margins, allowing them to reach this growth year on year.
mrchub.com