Indorama Ventures records strong growth in Volumes and Profits
Aug 07, 2015
Bangkok, Thailand – August 7, 2015 – Indorama Ventures Public Company Limited (IVL), a leading integrated global producer of polymers, saw second quarter sales revenue increase to THB 61.2 billion, with a record production of 1.8 million tonnes on the back of higher utilization rates and additional volumes from new acquisitions.
IVL’s scale and business model pursues to build a world-class global corporation and management that are focused on excellence and governance in a sustainable way. IVL has demonstrated its overall resilience to the challenges faced by industry with a healthy Core as well as Reported profit before tax and after non controlling interests of Baht 7.2 billion for the last 12 months (LTM) ending 2Q15. During this period IVL achieved strong Operating Cash Flow of Baht 24.8 billion on a record production of 6.6 million tons.
IVL strives to differentiate and has been successful in building a significant portfolio of niche businesses that are harder to replicate though remain close to consumer daily necessity and therefore much resilient to global uncertainty. IVL’s HVA portfolio in LTM 2Q15 has generated revenue of Baht 81.2 billion or 34.8% of its total revenue that has grown from 30.5% in the previous period, while the total IVL has grown in scale by 9.5% in total volume. BRIC countries remain a laggard due to the economic slowdown and the over-build of capacities in necessities further compounds the situation. New capacities in India in the PTA value chain in 1H15 has delayed the recovery of PTA margins and has put pressure on downstream margins, which is expected to continue in rest of 2015.
Core net profit before taxes in the 2nd Quarter 2015 grew by 27.7% over 2014 to THB 2.3 billion while earnings per share for the quarter rose exponentially to THB 1.04 from THB 0.30 in the same quarter last year. The company has declared an interim dividend of THB 0.24 per share.
Mr. Aloke Lohia, Group CEO explained that its move into the high value-added space led by R&D and specialized materials led to important gains.
“We now have a keen focus on what has become a very successful strategy over the last few years. We have enhanced our high value-added (HVA) product profile so that it now constitutes 22% of our production volumes and 45% of our core EBITDA,” Lohia explained. “Currently we have a unique mix of high value-added products in our portfolio serving the automotive, hygiene, industrial and packaging sectors. This HVA segment saw a significant 31% YoY growth in its core EBITDA over the previous 12 months.”
The company’s North American business remained strong with a Core EBITDA over the last 12 months of US$327m. The second half of 2015 in this region is expected to see higher volumes, due to the full effect of the volumes expected following the completed acquisition of the PTA facility in Canada in the second quarter of 2015.
IVL capacity grew by one million tonnes to reach 8.5 million tonnes following its acquisitions in 2015 and this is expected to grow a further 700,000 tonnes in the second half of the year under its ongoing M&A CAPEX plan.