Borealis results continue to improve in the second quarter of 2010 in an ongoing volatile economic environment

16-Aug-2010 - Austria

Borealis announced a net profit of EUR 92 million for the second quarter of 2010, a further improvement compared to EUR 54 million in the first quarter of this year as well as versus the second quarter of 2009 when Borealis recorded a net profit of EUR 35 million.

Net debt decreased during the second quarter driven by the higher margin environment. Gearing reached 44% at the end of June 2010 which is slightly above last years’ closing balance of 43%, but well within Borealis’ target range of 40-60%.

Feedstock prices came down after a peak in April while polyolefin market prices continued to increase leading to improved industry margins. European polyolefins industry sales volumes are in line with previous years’ sales levels. Borealis’ sales volumes increased quarter-on-quarter in most market segments compared to the first quarter of 2010.

The Base Chemicals business group positively contributed to the result with volume growth and improved margins in the feedstock and olefins business. The melamine and plant nutrients business also showed improved sales volumes and profitability compared to the first half of 2009.

Backed by its strong financial position and its two owners IPIC and OMV, Borealis continues with its investment programme across its portfolio of products and regions. In the Middle East, Borouge, Borealis’ joint venture in Abu Dhabi, has initiated the start up of its Borouge 2 operations as planned. The new world-scale ethane cracker, Olefins Conversion Unit, and polyethylene (PE) unit have all been successfully started and the polypropylene (PP) units, the first at the plant, will follow shortly. Once fully operational, the expanded plant will have the capacity to manufacture 2 million tonnes of polyolefins per year. During the quarter, contracts valued at US$ 3.7 billion were awarded for the Borouge 3 mega-project in Abu Dhabi, thereby underpinning the further expansion of the plant’s production capacity to 4.5 million tonnes by the end of 2013. Borouge also celebrated the groundbreaking of its Abu Dhabi innovation centre and the inauguration of its first compounding plant in China, in addition to announcing its plans to build a second plant by 2012.

Borealis also continues to develop its European assets. Over the next three years EUR 145 million will be invested in the melamine and plant nutrients production in Linz, Austria, while at the same time internal efficiency and profitability of the site will be increased. The new LDPE plant in Stenungsund, Sweden was started-up and was officially inaugurated on June 2. The investment of over EUR 400 million will further secure Borealis' position serving the growing wire and cable market.

https://www.chemeurope.com/en/news/121526/borealis-results-continue-to-improve-in-the-second-quarter-of-2010-in-an-ongoing-volatile-economic-environment.html