AkzoNobel 1Q volumes above expectation with robust pricing

AkzoNobel expects the ongoing macro-economic uncertainties to continue and weigh on organic volume growth, said the company.

The company will focus on margin management, cost reduction, working capital normalization and de-leveraging.

Revenue stood at EUR 2525 M and EUR 2657 M for 1Q 2022 and 1Q 2023, respectively. Gross profit stood at EUR 981 M and EUR 982 M for 1Q 2022 and 1Q 2023, respectively. SG&A costs stood at EUR (749) M and EUR (796) M for 1Q 2022 and 1Q 2023, respectively.

Operating income stood at EUR 232 M and EUR 182 M for 1Q 2022 and 1Q 2023, respectively. Profit before tax stood at EUR 228 M and EUR 151 M for 1Q 2022 and 1Q 2023, respectively. Profit from continuing operations stood at EUR 166 M and EUR 106 M for 1Q 2022 and 1Q 2023, respectively. Profit stood at EUR 166 M and EUR 105 M for 1Q 2022 and 1Q 2023, respectively.

Profit attributable to shareholders of the company stood at EUR 154 M and EUR 94 M for 1Q 2022 and 1Q 2023, respectively. Profit attributable to non-controlling interests stood at EUR 12 M and EUR 11 M for 1Q 2022 and 1Q 2023, respectively. Comprehensive income stood at EUR 255 M and EUR 95 M for 1Q 2022 and 1Q 2023, respectively.

We remind, AkzoNobel has reached an agreement with US-based Sherwin-Williams to acquire its Chinese decorative paints business for an undisclosed fee. The deal is expected to be completed in the second half of 2023 and includes the Huarun brand, it said in a statement.

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MRC) -- Russia's second-largest oil producer Lukoil said on Thursday its subsidiary LITASCO had completed the sale of the ISAB oil refinery in Sicily to Cypriot private equity firm G.O.I. Energy following approval by Italian authorities, said Hydrocarbonprocessing.

It did not disclose financial details. G.O.I. energy said in a statement it aims to turn the refinery into "one of Europe's main energy hubs" through synergies with industrial partners, including commodities trader Trafigura.

"ISAB and Trafigura ... signed long-term commercial agreements that will ensure continuity in the supply of raw materials and the purchase of finished products. Trafigura will play a key role in ensuring the full operation of the refinery in the future," the statement said.

The ISAB plant in Sicily refines 320,000 barrels per day of crude, accounting for a fifth of Italy's refining capacity. It directly employs about 1,000 people in the economically depressed southernmost region of Italy.

Lukoil said in January it had reached a preliminary deal to sell the refinery to G.O.I Energy, paving the way for its first significant asset disposal since the Ukraine invasion began in February last year.

Although Lukoil has not directly been targeted by Western sanctions on Russia, the ISAB refinery was affected by an embargo on Moscow's crude as banks were reluctant to finance procurement for a Russia-related company.

The Italian government eventually gave conditional approval to the deal, after a close consideration of "Golden Power" regulations that are designed to protect industries deemed of strategic importance.

We remind, Lukoil completes reconstruction of several units at Volgograd refinery. A large-scale reconstruction has been completed at the Volgograd refinery. The project included modernization of the CDU-VDU-5 crude distillation unit with production capacity of 3.5 MMtpy and the solvent extraction unit with production capacity of 300, 000 tpy. Over 230 core equipment items were installed and technologically outdated units were decommissioned. The share of Russia-made equipment installed during the reconstruction exceeded 70%. The construction site spanned the area of 34 thousand square metres; investments into the project exceeded 12 B roubles.

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LyondellBasell may build its second chemical recycling plant at its refinery in Houston, one of the several plans it is considering for the site after the company shuts down the complex, the producer said.

LyondellBasell plans to build its first commercial-scale chemical recycling plant at its Wesseling site near Cologne, Germany. The project will use LyondellBasell's MoReTec process technology, which is already featured in a semi-industrial-scale chemical recycling plant in Ferrara, Italy. A final investment decision for the Wesseling project is expected by the end of 2023.

Much of the waste for the Wesseling plant will come from a plastic-waste sorting and recycling facility that is being developed by Source One Plastics, a joint venture made up of LyondellBasell and 23 Oaks Investments.

If LyondellBasell decides to develop the Wesseling site, then the Houston refinery could host the company's second chemical-recycling plant, said Peter Vanacker, CEO. He made his comments during an earnings conference call. Vanacker had mentioned chemical recycling at the Houston refinery a year ago.

The refinery has hydrotreaters that could upgrade the pyrolysis oil produced by the chemical recycling plant.

We remind, LyondellBasell (LYB) said it is moving ahead with engineering for a commercial scale advanced plastics waste recycling plant it intends to build at its Wesseling, Germany, production site together with Germany’s 23 Oaks Investments. The companies agreed to form a joint venture, called One Source Resources, that would operate the facility with capacity to convert the plastics waste generated by an estimated 1.3 million people into feedstock to make 50,000 t/y of new plastic materials.

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North American chemical railcar traffic fell for a second week, with loadings for the week ended 29 April down 1.3% year on year to 47,654, led by a 1.9% decline in the US, according to the latest freight rail data by the Association of American Railroads (AAR).

For the first 17 weeks of 2023 ended 29 April, North American chemical rail traffic was down 3.2% year on year to 776,704, with US traffic down 6.0%, to 552,069 loadings.

In the US, chemical railcar loadings represent about 20% of chemical transportation by tonnage, with trucks, barges and pipelines carrying the rest. In Canada, chemical producers rely on rail to ship more than 70% of their products, with some exclusively using rail.

We remind, North American chemical railcar traffic fell 0.1% year on year to 47,726 loadings for the week ended 22 April, led by a 1.5% decline in the USA. In the previous week, ended 15 April, chemical railcar traffic rose 0.6%, following six consecutive weekly declines.

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Trinseo (Wayne, Pennsylvania) has reported a first-quarter loss of USD49 million, down from profit of USD17 million in the year-ago quarter on lower volumes and margins, said the company.

Sales totaled USD996 million, down 28% year over year (YOY) from USD1.387 billion on continued customer destocking and demand weakness, the company said. Adjusted earnings per share came to a loss of USD1.01, down from profit of USD2.08 in the year-ago quarter and short of analysts’ consensus estimate of a USD0.62 loss as compiled by S&P Global Market Intelligence.

Adjusted EBITDA totaled USD36 million, up 112% YOY from USD17 million. Volumes declined in all segments, compared to the year-ago quarter, while margins were hit by a USD34 million net timing variance and unfavorable impacts of USD19 million from natural gas hedging and USD10 million from manufacturing cost under-absorption.

“We anticipate performance will significantly improve in the second quarter from lower raw material and corporate costs, better fixed-cost absorption and a lower natural gas hedge loss,” said Bozich. “While we are expecting a gradual demand increase through the end of the year, the range of our full-year outlook reflects no sales volume improvement at the low end and a 10% improvement at the high end.”

For the second quarter, the company expects a net loss from continuing operations of approximately USD15 million and adjusted EBITDA of approximately USD80 million.

We remind, Trinseo has added a new grade to its Magnum ABS family. Complementing the bio formulations of the material made with 60 and 80 percent bio-attributed content made available in late 2022, the company has now launched a version with 95 percent mass-balanced renewably sourced content.

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