BASF reports Q1 sales decrease

BASF had a 13.4% decrease in sales for Q1 2023, from EUR23.1 billion in Q1 2022 to EUR20.0 billion, said the company.

According to the company, this was primarily the result of “lower volumes in almost all segments due to weaker demand”.

However, net income was EUR1.6 billion, EUR340 million higher than in the same period of the previous year.

“BASF started off 2023 better than analysts had expected – and in a stagnating and difficult economic environment,” said D. Martin Brudermuller, chairman.

The company forecasts sales of between EUR84 billion and EUR87 billion for 2023.

We remind, BASF announced that it has received the International Sustainability and Carbon Certification (ISCC) PLUS for certain grades of plastic additives produced at its manufacturing sites in Kaisten, Switzerland and McIntosh, Alabama, United States.

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Evonik introduces a diverse range of additives under the brand name TEGO Cycle to help its customers improve the process and increase the final quality of recycled plastics, said the company.

Designed to save energy during the mechanical recycling process, the TEGO Cycle portfolio of additives also enhances the quality of polymers, enabling the transition of the plastics value chain into a 'value cycle.'

Evonik will showcase its entire additives portfolio for improving the mechanical recycling process and final quality of plastics at booth A12 in Amsterdam during the Plastics Recycling Show Europe on 10-11 May 2023. In addition to the latest TEGO Cycle products, Evonik will launch its new organo-modified siloxane-based TEGOMER Polymer Processing Aids (PPA) for converters looking to replace standard PPAs made from fluoroelastomers in PE and PP processing.

We remind, Linde has signed a long-term agreement to supply green hydrogen to Evonik. Linde will build, own and operate a nine-megawatt alkaline electrolyzer plant on Jurong Island, Singapore. The plant will produce green hydrogen, which Evonik will use to manufacture methionine, an essential component in animal feed. The new supply agreement supports the planned expansion of Evonik’s existing facility and will help Evonik limit its greenhouse gas emissions in Singapore.

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Arkema sets a new climate plan with more ambitious targets by 2030 across its whole value chain, approved by the organization Science Based Targets initiative (SBTi), said the company.

The Group now aims to reduce its greenhouse gas emissions by 48.5% for Scopes 1+2 and by 54% for Scope 3 by 2030 versus 2019.

In July 2022, the Group had set new greenhouse gas reduction targets, in line with the expectations of the Paris Agreement, which aims to limit global warming to 1.5°C above pre-industrial levels by the end of the century.

Thanks to significant progress made in 2022, these targets have been raised, and Arkema now aims for a 48.5% reduction in the Group's greenhouse gas emissions for Scopes 1+2, and a 54% reduction for Scope 3 by 2030 relative to 2019. These new targets have been approved by the independent global organization Science Based Targets initiative (SBTi).

“Arkema has made long-standing commitments in the fight against climate change,” said Thierry Le Henaff, Chairman and CEO. “From its energy procurement policy to industrial innovation, from its portfolio of solutions to the dissemination of a ‘climate and environment culture’, this virtuous trajectory mobilizes all of the Group's components, and we are particularly proud that our new 2030 targets have been validated by the SBTi,” added Le Henaff.

Already committed for many years to the pursuit of energy efficiency at its industrial sites through its Arkema Energy program, and to the development of low-carbon energy procurement, the Group has identified room for improvement in its Scopes 1+2, and so plans to reduce its emissions from 3.7 million tons of CO2 equivalent in 2019 to 1.9 million tons in 2030.

We remind, Arkema announces the doubling of its polyester resins capacity in its Navi Mumbai facility in India, reinforcing the Group’s leadership position in the global powder coatings market and its commitment to developing very low-VOC technologies. Arkema invested in the Navi Mumbai facility in early 2019 to expand geographic coverage of its high performance, more sustainable, low-VOC products, and to support its customers in their development. The site includes a modern manufacturing unit and a dedicated laboratory to provide application development and technical support in the region.

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Shell's Upstream segment includes exploration and extraction of crude oil, natural gas and natural gas liquids. It also markets and transports oil and gas, and operates the infrastructure necessary to deliver them to the market, said the company.

Segment earnings, compared with 4Q 2022, mainly reflected lower prices (decrease of $188 M), timing of liftings (decrease of USD305 M), and favourable tax movements in 4Q 2022 (decrease of $543 M), partly offset by lower operating expenses (decrease of USD286 M), lower exploration expenses and well writeoffs (decrease of $148 M) and lower depreciation (decrease of USD105 M).

1Q 2023 segment earnings also included charges of USD111 M relating to impairments, and deferred tax charges of USD132 M due to amendments to IAS 12, partly offset by gains of USD73 M due to the fair value accounting of commodity derivatives, gains of USD70 M from disposal of assets, and gains of USD48 M related to the impact of the strengthening Brazilian real on a deferred tax position.

These gains and losses are part of identified items, and compare with 4Q 2022 which included charges of $1385 M relating to the EU solidarity contribution and USD441 M relating to the UK energy profits levy, partly offset by favourable movements of USD304 M due to the fair value accounting of commodity derivatives.

Adjusted earnings and adjusted EBITDA were driven by the same factors as the segment earnings and adjusted for identified items. Cash flow from operating activities for the quarter was primarily driven by adjusted EBITDA, partly offset by tax payments of USD2019 M, the timing impact of dividends from joint ventures and associates of $514 M, and working capital outflows of USD475 M.

Total production, compared with 4Q 2022, increased mainly due to lower scheduled maintenance and lower unscheduled deferment, partly offset by divestments. Segment earnings stood at USD2779 M, USD1380 M, and USD3095 M for 1Q 2023, 4Q 2022, and 1Q 2022, respectively, a change of +101%.

Adjusted earnings stood at USD2801 M, USD3061 M, and USD3450 M for 1Q 2023, 4Q 2022, and 1Q 2022, respectively, a change of -9%. Adjusted EBITDA stood at USD8837 M, USD9418 M, and USD8977 M for 1Q 2023, 4Q 2022, and 1Q 2022, respectively, a change of -6%.

We remind, Shell has awarded the Serikandi Kent Energy Solutions joint venture a five-year commissioning and start-up services contract for its activities in Brunei Darussalam. Details and the value of this long-term contract – the first win for Serikandi Kent Energy Solutions - were kept under wraps although Joe McCormick, Kent’s executive vice president for Asia Pacific, said the JV would be building up its local resources in tandem with the BSP work.

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Indian state-owned oil refiner Hindustan Petroleum Corporation Ltd (HPCL) said it posted its biggest quarterly profit in nine years, helped by a fall in crude prices and higher refinery margins, said Hydrocarbonprocessing.

Net profit for the fourth quarter ended March 31 jumped about 80% to 32.23 B rupees (USD394.1 MM) from 17.95 B rupees a year earlier, according to a stock exchange filing.

Sale of products grew nearly 8.6% to 1.14 T rupees, with domestic sales rising to 10.92 MMt from 10.26 MMt a year earlier.

Indian refiners' crude oil processing stayed near all-time highs in March, catering to solid seasonal demand as fuel consumption jumped to a record high, driven by robust economic activity in the world's third-largest oil consumer. The Mumbai-based company also said that its average gross refining margin - profit from making refined products from one barrel of oil - was USD14.01/bbl for the quarter, compared to USD12.44.bbl a year ago.

In March, oil prices slumped to their lowest in more than a year, a positive for refining companies that import crude oil as their raw material.

Brent crude prices have fallen nearly 49% from a peak last year, helping lift oil companies' marketing margins. HPCL in its statement said that energy transition initiatives will be consolidated under a new company, adding that it will also explore carving out its lubricants business.

The company is the first among its state-run peers, including refiner Indian Oil Corp and oil marketing company Bharat Petroleum Corp, to report quarterly results.

We remind, GAIL (India) Ltd, the country's top gas supplier, plans to build a USD4.89-B ethane cracker near its liquefied natural gas (LNG) import plant in Western India, two sources with direct knowledge of the matter said, as it seeks to meet an expected surge in demand. Indian companies are boosting their petrochemical production capacity as the expanding economy boosts the need for goods ranging from plastics to paints and adhesives. A cracker produces ethylene, required for products such as plastics.

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