Indorama Ventures Core Profit Soars 74% to a New Record
Aug 10, 2016
Bangkok, Thailand – 10 August 2016 – Indorama Ventures Public Company Limited (IVL), a global chemical producer, today announced its results for the second quarter 2016. The company’s Core Profit after tax and non-controlling interests (NCI) climbed to a record Baht 2.9 billion in 2Q16, reflecting very strong growth of 74% year-on-year (YoY) driven by margin recovery in the PET segment and contributions from additional feedstock volumes, primarily PTA from new acquisitions IVL Spain, formerly Cepsa Spain, and Aromatics Decatur, formerly BP Decatur in the U.S. as well as High Value-added product volume thanks the contribution of IPA and NDC from those acquisitions.
The last twelve months (LTM) second quarter 2016 Core EBITDA saw PET sector growth of 19% underpinned by excellent growth in the Fibers segment of 46% year-on-year. Regional earnings in the HVA portfolio all grew both quarter-on-quarter and year-on-year with core LTM EBITDA topping Baht 12 billion from Baht 9 billion the previous year.
The second quarter saw a non-cash inventory gain of Baht 0.6 billion as a result of the increase in oil prices that was further supplemented by net extraordinary income of Baht 2.5 billion, primarily coming from a gain on bargain purchase on the IVL Spain acquisition and resulted in a reported net profit of Baht 5.9 billion. For the last twelve months we achieved net profit of Baht 10.8 billion or EPS of Baht 2.08.
Mr. Aloke Lohia, Group CEO of IVL commented, “Our second quarter results continue to show improvement across our segments. The recent acquisitions of IVL Spain and Aromatics Decatur reflect our unique business model and strategic choices that made IVL ever more resilient and efficient. Our blend of focused businesses will transform us as one of the most competitive producers in our space and provide us downside protection on volumes and integrated margins while preserving our upside potential as the industry recovers. IVL is now the most integrated global company in our industry.”
Commenting on the global business outlook, Mr. Lohia said, “North America results are mixed as our ethylene oxide and glycol (EOEG) earnings were impacted by a catalyst turnaround while Fibers and PET, in both necessities and HVA, showed superior performance and achieved strong Core EBITDA growth YoY. The strong demand for necessities in Asia continues to overcome chronic overcapacity, especially in PTA, and we are cautiously optimistic amid signs of a slow recovery that is led by the restructuring of many non-core underperforming assets and a very cautious build-up of new capacity. The EMEA region has enjoyed absolute growth of core EBITDA on a QoQ and YoY basis and we expect to see continued growth of our products, led by the Rotterdam PTA expansion and improving IPA production, going forward.”
“Looking ahead, our diversified portfolio of products, geography and markets are serving as a catalyst for future growth. IVL will continue to create synergies as well as accelerate the transformation of our operations, which will help us outperform the industry benchmarks and create lasting value of our stakeholders,” Mr. Lohia concluded.