Linde net profit slips

MOSCOW (MRC) -- German industrial gas company Linde said second-quarter net profit was hit by adverse exchange-rate effects and competitive U.S. government healthcare tenders, but confirmed its outlook for the full year, as per The Wall Street Journal.

Second-quarter net profit was down 2.3% on the year to EUR334 million (USD448.9 million) from EUR342 million. This figure was slightly above analysts' expectations of EUR316 million.

Revenue declined slightly to EUR4.17 billion, in line with expectations. Linde said lower prices in the U.S. due to the introduction of competitive government tenders damped revenue and earnings.

The company maintained its 2014 guidance, despite currency headwinds that will continue to weigh on growth and profitability.

"We have proved our stability, although reported growth was again hampered by unfavorable exchange-rate effects," said Wolfgang Buchele, Linde's chief executive.

For the first half, revenue of the most important segment, industrial gases, declined 2.8% to nearly EUR6.83 billion. The engineering segment fared better with revenue rising 14% to EUR1.42 billion in the first half.

The company didn't offer any new information on its Russian business activities and the possible effects of sanctions. Linde's projects in the region include plans to build two hydrogen plants in Tartarstan, managing sites for the Russian petrochemical company SIBUR, and a joint venture in Samara for an ammonia plant.

The Linde Group is a world-leading gases and engineering company with around 62,000 employees in more than 100 countries worldwide.
MRC

MOSCOW (MRC) -- M&G Chemicals, part of the Mossi Ghisolfi Group (M&G), announces that the Court of Milan has confirmed its ruling against Invista Technologies declaring in a first instance the nullity of the Italian counterpart of Invista’s patent relevant to barrier resin products, said the producer at its press release.

The Court of Milan also condemned Invista to pay all damages caused to M&G through the acts of unfair competition, ordering the immediate payment of 70.000,00 Euros prior to the final evaluation of such damages incurred by M&G.

In addition Invista was condemned to pay the relevant legal costs and fees in the amount of 50.000,00 Euros as well as the costs of the Expert appointed by the Court.

According to Marco Ghisolfi, President and CEO of M&G Chemicals, M&G Chemicals welcomes the decision of the Court of Milan as it confirms M&G Chemicals’ original position that Invista had no valid rights within this patent and no valid rights to limit M&G’s fair commercial activity on the barrier resin market.

Last year, Invista Performance Technologies has acquired from La Seda de Barcelona SA intellectual property relating to its leading purified terephthalic acid (PTA), polyethylene terephthalate (PET) and related process technologies, including the full rights to exclusively license the technologies in the region comprising Europe, the Middle East and Africa.

Invista is one of the world’s largest integrated producers of chemical intermediates, polymers and fibers. The company’s advantaged technologies for nylon, spandex and polyester are used to produce clothing, carpet, car parts and countless other everyday products. Headquartered in the United States, INVISTA operates in more than 20 countries and has about 10,000 employees.
MRC

MOSCOW (MRC) -- Global polypropylene (PP) capacity has increased at a Compound Annual Growth Rate (CAGR) of 5.2% from 2003, reaching 65 mln tons pa in 2013, and is expected to continue rising to 86 mln tons by 2018, at a slightly higher CAGR of 5.8%, reported Plastemart with reference to GlobalData.

China and Russia will be the leading contributors to future PP capacity increases and will account for a combined 45% of global additions over the next five years.

Carmine Rositano, GlobalData's managing analyst covering Downstream Oil & Gas, says: "A demand-side push is driving additional capacity in China, forcing it to produce more domestic PP. Indeed, China will lead new global PP capacity increases over the next five years, as its goal of self-sufficiency drives 7.48 mln tons of additions, of which 97.6% will come from new plants and the remainder from the expansion of existing facilities." China is expected to account for 62.4% and 35.5% of planned Asian and global capacity additions by 2018, respectively.

Russia will be the second largest contributor to growth, mainly due to the country's recent diversification into the petrochemicals sector, which has seen substantial investment in bulk polymer industries, such as polyethylene and PP.

Rositano explains: "Until 2012, Russia's PP capacity was only 0.65 mln tons, but this increased to 1.33 mln tons in 2013 and is further expected to reach approximately 3.48 mln tons by 2018, with all additions coming from new plants." Venezuela and India will be the respective third and fourth largest contributors to capacity increases over the next five years, with both countries investing in the PP sector to cater to the domestic market and replace imports.

As MRC wrote previously, scheduled maintenance works at Russian plants have just begun, but PP prices soared in the Russian domestic market. Given the turnarounds of another three producers in August it is clear that next month will also be difficult in the Russian PP market.

July - September are traditional period of scheduled maintenances at Russian producers. The first in the queue was Tobolsk-Polymer, which shut its 500,000 tonnes/year PP production on a month long turnaround on 30, June.
The shutdown of the largest PP producer in Russia immediately led to a serious rise in prices. The shutdown of other Russian PP productions in Tomsk, Omsk and Ufa will aggravate the situation in the market further.
MRC

MOSCOW (MRC) - Finnish packaging maker Huhtamaki on Friday reported second-quarter operating profit in line with market expectations and stood by its outlook for trading conditions to remain relatively stable in 2014, said Reuters.

The company, known for making paper cups for McDonald's , posted April-June underlying operating profit of 54 million euros (USD73 million) compared to a mean forecast of 53.6 million in a Reuters poll of analysts and year-ago 49.2 million.

Sales in the quarter amounted to 628 million euros, also in line with analyst expectations.

Huhtamaki said earlier on Friday it will start evaluating options for its Films business and could eventually divest the operation.

As MRC wrote before, Huhtamaki, the Finnish-based consumer packaging specialist with worldwide operations, will build a moulded fibre egg packaging unit adjacent to its existing packaging facility in the greater Moscow area.
The new unit will concentrate on a narrow range of high-volume premium egg packaging, with complementary products sourced from other Huhtamaki units and technology licensees. This supply network enables the company to start sales and deliveries while the new unit is still under construction. The company already has a specialised fresh foods sales force in Russia.
MRC