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Earnings Release
IVL Revenues US$ 1.7 bn in Q1 2012
May 11, 2012
Bangkok, Thailand - 11 May 2011 - Indorama Ventures Public Company Limited (IVL), the world's leading vertically integrated Polyester Value Chain producer, saw sales volume move up to 1.2 million tonnes in Q1 2012, about 13% up from Q4 2011, as utilization rates started to rise following the new year as the industry saw an end to the de-stocking phase of Q4 2011 and a commencement of re-stocking to meet demand from consumers. Both volumes and values bounced back from Q4 2011, with sales revenue of US$ 1.696 million, an increase of 21% over the previous quarter.
 
Consolidated EBITDA for the quarter climbed 129% over the previous quarter to US$ 98 million. After adjusting for inventory gains and losses, Core EBITDA was still higher than Q4 2011 by 6%, at US$ 84 million. Net profit was US$ 55 million, an improvement on the net loss of US$ 51 million in Q4 2011.
 
Mr. Aloke Lohia, Group CEO of Indorama Ventures explained, "The encouraging reversal of volume demand reflects a more positive market sentiment while our customers commenced buying again as prices leveled off. Sustained demand from consumers led to demand for all products and has contributed to an improved EBITDA.
 
"Though markets continue to be turbulent globally, it is a testament to our business as the linkage between the upstream petrochemicals industry and downstream fast-moving consumer goods companies on a global basis that has enabled the company to continue its drive for growth," Lohia said.
 
PET sales revenue in Q1 2012 increased by 15% over Q4 2011 and 29% over Q1 2011, driven by the volume growth as acquisitions completed in Q1 2011 in China, Indonesia, Mexico, Poland, and USA were fully-integrated for the first time. PET demand picked-up globally after a phase of de-stocking of inventories in the last quarter of 2011.
 
Polyester and Polyolefin fibers sales revenue in 1Q 2012 sharply increased by 78% over Q4 2011 and 87% over Q1 2011, driven by the volume growth from the full integration of last year's acquisitions in Indonesia, USA and Europe, with the addition of Wellman International in November 2011 and FiberVisions in January 2012.
 
The outlook for PTA remains subdued in Asia, where margins are at low levels, but expected to improve gradually. Captive consumption within IVL and recent cost improvement projects should help achieve improving performance throughout the year.
 
As performance continues to improve in Q2 2012, the company anticipates greater operational improvements taking place in the first half 2012 in Thailand and Indonesia and the debottlenecking of capacity at the IVL plant in China to 500kt per annum will lead to further revenue and earnings growth in 2012. The April 2012 restart of the company's Lopburi site, hit by severe flooding in 2011, and the new MEG acquisition in the USA, Old World, will contribute significantly to 2012 performance. The previously announced PET acquisition, Polypet, in Indonesia is also due to close in Q2 2012 and is expected to be accretive to earnings in its first year of operations.