Celanese Q1 earnings down on weak paints, coatings, construction markets

Celanese Corp. (Dallas, Texas) reported a first-quarter net loss of $17 million, down from profit of $124 million in the year-ago quarter, as per Chemweek.

Sales totaled $2.389 billion, down 8% year over year. Adjusted earnings per share came to 57 cents, down 73% year over year from $2.08, but well above the analysts’ consensus estimate of 39 cents as compiled by S&P Capital IQ. The figure also exceeded the company’s own guidance of 25-50 cents, which was issued along with fourth-quarter results on Feb. 18. Celanese cited “slightly better demand” than expected for its engineered materials products in the Western Hemisphere.

“In the first quarter, end-markets across both businesses developed largely as anticipated, impacted by continued sluggish global demand and persistent weakness in key end-markets like paints, coatings, and construction,” said president and CEO Scott Richardson in prepared remarks. “In the automotive sector, Western Hemisphere destocking in the value chain largely reached a more stabilized level by late March, helping to improve our sales into the automotive sector and contributed to the overall mix improvement for the quarter.”

Richardson said the company had not seen any direct impact from new US tariffs during the first quarter. He also said that while the tariffs had made the demand outlook more uncertain, he did not expect any meaningful direct impact on earnings, owing to the geographic flexibility of the company’s manufacturing and purchasing operations.

"We expect tailwinds as several non-recurring items from the first quarter do not repeat, including the resumption in the second quarter of the dividend in the acetyl chain from our partner in China,” said Richardson. “We also anticipate slight volume recovery in automotive in the second quarter, with more stabilized demand, especially in the US and China, as well as a normalization of acetate tow orders after the first quarter timing delays.”

Richardson forecast second-quarter adjusted earnings per share of $1.30 to $1.50, down from $2.38 in the year-ago period.

The acetyl chain reported sales of $1.1 billion, up 1% sequentially as a 3% increase on volume offset 1% declines on both price and currency effects. Adjusted EBIT came to $168 million, down 34% sequentially. Celanese said demand was similar to that of the fourth quarter, including persistent weakness in the Western Hemisphere and sluggishness in Asian demand for paint, coatings and construction.

The engineered materials segment reported sales of $1.3 billion, up 0.5% sequentially as volume and price gains were partly offset by currency effects. Adjusted EBIT came to $126 million, down 19%. Celanese said that significant automotive destocking in the Western Hemisphere, which began in the second half of 2024, continued through the first quarter, “largely reaching more stabilized levels by late March.”

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IMCD NV, a distributor and formulator of specialty chemicals and ingredients, has announced that the company and its CEO, Valerie Diele-Braun, have agreed that Diele-Braun will step down as CEO and a management board member “for personal reasons,” effective today, as per Chemweek.

Diele-Braun became IMCD CEO in January 2024. Marcus Jordan will assume the role of IMCD CEO as of today, the company’s supervisory board said in a statement. Jordan has been IMCD chief operating officer and a management board member since 2022. In 26 years with the company, he has served as president/Americas and group development director, and in various roles in the UK. He has been a member of the IMCD executive committee since 2014.

“The supervisory board will, in the coming period, review the further composition of the management board as part of its ongoing succession planning,” it said.

IMCD, meanwhile, is scheduled to announce its first-quarter results tomorrow.

We remind, Sun Chemical, a subsidiary of Japan’s DIC Corp., today announced plans to implement a tariff surcharge on color materials products, including pigments. The surcharge will apply to materials imported and produced in the US.

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Smackover Lithium, a joint venture between Standard Lithium and Equinor developing a project in southwest Arkansas, said its project has been designated as a priority critical mineral project by the Trump administration, as per Chemweek.

The designation, taken under Executive Order 14241, Immediate Measures to Increase American Mineral Production, issued on March 20, 2025, “underscores the project’s strategic importance to national security, economic prosperity, and energy independence,” according to Standard Lithium.

The project “has been included on the Federal Permitting Dashboard as a transparency project,” Standard Lithium said in statement. “This designation ensures increased transparency, accountability, and predictability in the permitting review process, aligning with President Trump’s directive to expedite domestic critical mineral projects.”

The Smackover project is one of three domestic lithium projects to receive the designation, and the only one using direct lithium extraction (DLE) technology, Standard Lithium said.

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Minerals Technologies reported a first-quarter net loss of $144 million, swinging from a net gain of $46.7 million in the year-ago quarter as the company established a $215 million reserve for talc-related litigation costs, as per Chemweek.

Net sales were down 8% to $492 million, on uncertainty in end markets softening demand. “Throughout the quarter, we experienced slower demand from customers in both of our business segments. This was a result of destocking activities and shifting order patterns, primarily in January and February. We saw a significant improvement in sales in March, which we expect to continue through the second quarter,” said Douglas Dietrich, chairman and CEO.

Operating income excluding special items was $63 million, down 18% year over year. Adjusted earnings totaled $1.14 per share, below analysts’ consensus estimate of $1.19 per share reported by S&P Capital IQ.

Consumer and specialties segment sales were down 10% year over year, to $268 million, while segment operating income fell 29%, to $30 million. Results were driven by higher operating costs due to unfavorable volume leverage and product mix, the company said.

Engineered solutions segment sales declined 6% year over year, to $224 million, while segment operating income decreased 11%, to $34 million, due to lower sales levels and an unfavorable mix in its environmental and infrastructure product line.

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Sabic has lowered its 2025 GDP growth forecast as the petrochemicals market continues to face “market challenges" including the potential impact of US tariffs on global trade, and said a restructure will be completed this year, as per Chemweek.

The company reported on May 4 in its first-quarter financial results a one-time impairment of 1.07 billion Saudi riyals ($285 million) in the first quarter for a “strategic restructuring,” although no more specific details were given. Sabic posted a net loss for the quarter of 1.2 billion riyals, narrowing sequentially from a net loss in the fourth quarter of 1.89 billion, but reversing from net profit of 250 million riyals a year earlier.

The petrochemicals sector has faced sustained oversupply and challenged margins for several years, with slowing economic growth expected to potentially add to the industry’s woes as petchems demand is traditionally closely connected to GDP growth.

Sabic, the chemicals business of Saudi Aramco, dropped its 2025 GDP growth to 2.2%, from its most recent guidance issued in February of 2.5%.

“Undoubtedly, the current tariffs have a significant impact on the global economic process,” Sabic’s CEO Abdulrahman al-Fageeh said at a press conference. “Restructuring is usually done on an ongoing basis, but this time it was on a larger scale, so that its positive impact on the company would be greater. It is expected that the restructuring will be completed during this year.”

In April last year, Sabic announced and implemented the closure of one of its naphtha crackers at Geleen in the Netherlands due to a lack of competitiveness and structural oversupply. It is not clear if the restructuring referenced by Fageeh on May 4 relates to the implemented cracker closure or other as yet unspecified assets.

In an accompanying results presentation, Sabic said its 2025 priorities included optimizing operations and to “optimize and reposition our portfolio in line with our strategic businesses.”

The amount of savings by the company, estimated at 345 million riyals per year, will be further discussed in the third quarter, Saleh al-Hareky, executive vice president/corporate finance at Sabic, said at the May 4 press conference.

Despite the downbeat outlook, Sabic’s first quarter sales rose 5.8% compared to the prior-year period to 34.59 billion Saudi riyals, due primarily to increased sales volumes despite lower average selling prices and “market challenges,” it said.

“Sales performance was stable, supported by slightly higher production volumes in chemicals and polymers, although overall sales volumes were marginally lower, particularly in agri-nutrients and polymers,” the company said in the statement.

“The oversupply of petrochemicals continues to pressurize product prices and, in turn, profit margins,” said Fageeh in the prepared statement.

Sabic has maintained its projected capital investment of between $3.5 billion-$4 billion in 2025, unchanged from February, and said its $6.4 billion Fujian petrochemical project in China is progressing according to plan, along with the Petrokemya methyl tert-butyl ether (MTBE) plant.

The final investment decision on Fujian was announced in January 2024, and the startup is expected in the second half of 2026. Sabic also said it has started the Ibn Zahr LTRS-1 project, “which aims to enhance the utilization of feedstock and reduce the carbon footprint.”

All end uses for petrochemicals are stable from the fourth quarter and from a year earlier, except for industrial, electrical/electronics, and hygiene/health care sectors, which Sabic said “improved” sequentially from the fourth quarter, according to the accompanying presentation. Packaging and building/construction make up its biggest markets.

As to individual petrochemicals, ethylene glycol faces higher supply and “weak demand” while methanol is supported by “tight supply and natural gas shortages,” it said. MTBE faces “reasonable” regional demand in Europe and a seasonal blending demand recovery.

In the polymers sector, polyethylene is supported by global demand but “challenged by additional supply,” it said. Polypropylene is under pressure from oversupply and “weak demand” while polycarbonate is also facing “weak demand across major markets and oversupply,” it said.

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