DSM reports robust Q1

MOSCOW (MRC) -- DSM is reporting a robust first quarter with sales up 13% to EUR2.159 million (USD2.35 million) and a strong input from nutrition, said the company on its site.

According to the Q1 figures for 2017, the Netherlands-based Royal DSM - a global science-based company active in health, nutrition and materials - has net profit up 75% to EUR149 million (USD162 million) and is forecasting a strong outlook throughout 2017.

Cash from operating activities is up 43% to EUR196m (USD213 million), organic growth is up 9%, while adjusted EBITDA up 17% to EUR345 million (USD376 million).

"We are pleased to report a very good start to the year, with continued positive momentum in all businesses as we execute on our mid-term strategic and financial ambitions," says Feike Sijbesma, CEO/Chairman of the DSM Managing Board.

"Nutrition continued to deliver on its objectives with good growth from Animal and Human Nutrition. Materials demonstrated once again the benefit of its focus on specialties. Both businesses achieved strong volume growth, well above the market."

According to DSM, Q1 2017 sales increased by 12% compared to the same period the previous year, driven predominantly by organic growth of 8%. Volume growth continued to be good across all business lines, with both animal and human nutrition benefiting in part from timing of sales between quarters. Higher prices were driven by animal nutrition. Exchange rates had a 4% positive effect, mainly coming from a stronger US dollar and Brazilian real.

Q1 2017 Adjusted EBITDA was EUR257 million, up 14% compared to Q1 2016, resulting from good organic growth and the profit improvement programs. Currencies had a positive effect with the stronger US dollar and Brazilian real, partly offset by the stronger Swiss franc. Q1 2017 Adjusted EBITDA margin was 18.4%, up from 18.0% in Q1 2016, it adds.

Sales development in nutrition and health were 10% higher compared to Q1 2016 driven predominantly by higher volumes, with good growth across all regions and market segments, well above the market.

The reported volume growth in human nutrition in the quarter benefited from additional vitamin C volumes that could not be delivered in Q4. Normalized for this effect, Q1 2017 volume growth was about 5%. Prices were slightly down with lower contractual prices in Infant Nutrition and a product mix effect. Exchange rates had a positive effect led by the stronger US dollar.

And in food specialties, first quarter sales showed solid organic growth in enzymes, cultures and savory ingredients, while hydrocolloids had a weaker quarter.

"Notwithstanding the current global socio-economic volatility, we are confident that we will be able to deliver against our full-year objectives given our focus on improving our financial performance through our growth initiatives and our extensive and ambitious profit improvement programs. At the same time we continue to manage our business for the longer term by pursuing our innovation-driven growth strategy," adds Sijbesma.

MRC

MOSCOW (MRC) -- ExxonMobil Corp announced it will bring its Mobil-brand gas stations to Mexico, pumping USD300 MM in the coming decade as it seeks to gain a foothold in the country's retail fuel market, said Hydrocarbonprocessing.

Exxon expects to open its first service stations in Mexico later this year and will offer motorists its Synergy gasoline and diesel fuels, the US-based oil company said in a statement on Wednesday.

The company did not specify how many service stations it would open in Mexico or where it would source the fuel for them. But local newspaper Reforma reported on Wednesday that Exxon company official Martin Proske said in an interview that supply options included importing fuel via train or boat or buying gasoline from state-owned Pemex.

The plan follows BP Plc's announcement earlier this year that the British oil giant would open about 1,500 service stations in Mexico within five years.

BP told Reuters on Wednesday that its foray into Mexico is proving more promising than expected, and that it would likely increase its investment in everything from exploration to retail fuel sales.

Separately, Mexican media reported Royal Dutch Shell said it would also open its first gas station in the country this year, citing the firm's downstream chief for Mexico, Andres Cavallari. Shell did not immediately reply to requests for comment.

Latin America's No. 2 economy is home to about 11,400 gas stations and is the world's fourth biggest gasoline market, Mexico's energy minister has said.

For decades, Mexico's fuel market was closed—by law—to any company but Pemex. But in 2013, reforms ended Pemex's monopoly in everything from crude oil production to retail sales.

"Recent energy reforms present a unique opportunity to help meet the growing demand for reliable fuel supplies and quality service in Mexico," Exxon's Proske said in a company statement.

Fears had grown in Mexico that foreign investment might fall after US President Donald Trump was elected last year, as he railed against companies that moved operations to Mexico. US-Mexico relations have also been strained by Trump's threat to ditch the North American Free Trade Agreement and his promise to build a wall between the two countries.

But Exxon's announcement was the latest good news for Mexico's economy after General Electric Co last week praised the country as vital to its growth and Siemens later said that it was going to swap out US imports for local supplies at its Mexican plants.

However, growing fuel theft has worried some in the energy sector. Mexican authorities have been struggling to contain criminal gangs siphoning off fuel that Pemex has said is costing it some 27,000 bpd in gasoline and diesel.
MRC

MOSCOW (MRC) -- DuPont and The Dow Chemical Company have announced that Brazil's Administrative Council for Economic Defense (CADE) has granted conditional regulatory approval of their proposed merger of equals, as per DuPont's press release.

CADE's approval of the merger is subject to the implementation of remedies that maintain the strategic logic and value creation potential of the transaction for all stakeholders. The remedies include the divestment of a select portion of Dow AgroSciences' corn seed business in Brazil, including some seed processing plants and seed research centers, a copy of Dow AgroSciences' Brazilian corn germplasm bank, the Morgan brand and a license for the use of the Dow Seeds brand for a certain period of time.

This local remedy is incremental to the previously announced divestment of certain parts of DuPont's global crop protection portfolio and R&D pipeline and organization and Dow's global Ethylene Acrylic Acid copolymers and ionomers business, consistent with commitments already made to the European Commission and regulatory agencies in other jurisdictions.

The receipt of conditional approval in Brazil represents a very positive outcome for the merger transaction, which will position the companies to unlock significant value for all stakeholders as they pursue the subsequent intended separation into three industry leaders in Agriculture, Materials Science, and Specialty Products.

Dow and DuPont continue to work constructively with regulators in the remaining relevant jurisdictions to obtain clearance for the merger, which they are confident will be achieved. The companies continue to anticipate closing the merger between August 1, 2017 and September 1, 2017, with the intended spins to occur within 18 months of closing. The companies expect that the first step of the intended separation process will be the spin-off of the Materials Science Company, assuming such sequencing would allow for the completion of all intended spin-offs within 18 months of merger closing and would not adversely impact the value of the intended spin-offs.

As MRC reported earlier, the deal, unveiled in December 2015, will combine two of the oldest companies in the U.S. into a chemical giant called DowDuPont, initially valued at about USD130 billion. The combined company will then split itself into three separately-traded companies focused on agricultural products, material sciences, and specialty products about 18 to 24 months after the merger closes.

DuPont is an American chemical company that was founded in July, 1802. The company manufactures a wide range of chemical products, leading extensive innovative research in this field. The company is the inventor of many unique plastics and other materials, including neoprene, nylon, Teflon, Kevlar, Mylar, Tyvek, etc. DuPont was the developer and main producer of Freon used in the production of refrigeration equipment.

The Dow Chemical Company is an American multinational chemical corporation. Dow is a large producer of plastics, including polystyrene, polyurethane, polyethylene, polypropylene, and synthetic rubber. In 2016, Dow had annual sales of $48 billion and employed approximately 56,000 people worldwide. The Company's more than 7,000 product families are manufactured at 189 sites in 34 countries across the globe.
MRC

MOSCOW (MRC) -- Belarus's overall production of low density polyethylene (LDPE) was about 20,800 tonnes in the first four months of 2017, down by 52% year on year, according to MRC's DataScope Report.

According to the National Statistics Committee of Belarus, April LDPE production by the local producer Polymir was slightly more than 5,000 tonnes against 5,300 tonnes a month earlier. Thus, Polymir's overall LDPE output totalled 20,800 tonnes in January-April 2017 versus 43,200 tonnes a year earlier.

The fire at one of the ethylene units in last June, which led to a two-fold reduction in the olefin production, was the main reason for a major fall in the output in 2016.

The company's customers said Polymir planned to shut its LDPE capacity for scheduled maintenance works from 3 June. The preventive shutdown will take about a month, but some of the capacities will still be launched two weeks after the shutdown.

As reported earlier, an outbreak of gas-air mixture with the further flare combustion of outgoing products happened at workshop No. 104 on 18 June 2016. The fire damaged technological equipment in the production of ethylene, and some of the capacity has been idle since that.
According to the representatives of the company, this year the capacity for the production of ethylene will not be fully rebuilt.

Plant Polymir ("Naftan") is the largest petrochemical company in Belarus, produces a wide range of chemical products, such as low density polyethylene (LDPE), acrylic fibers, products of organic synthesis, hydrocarbon fractions, etc. Polymir was founded in 1968. Technologies of the largest foreign companies from Great Britain, Japan, Germany, Italy (Courtaulds, Asahi Chemical Co. Ltd, Kanematsu Gosho, SNIA BPD, etc.), As well as the development of scientific research institutes and design institutes of the CIS countries. The LDPE production's annual capacity is 130,000 tonnes.


MRC

MOSCOW (MRC) -- Rosneft and Eni S.p.A. have entered into a Cooperation extension agreement in the areas of upstream, refining, marketing and trading during the visit of an Italian delegation to Russia, as per Rosneft's press release.

The document was signed by Rosneft CEO Igor Sechin and Eni CEO Claudio Descalzi in the presence of Russian President Vladimir Putin and Italian Prime Minister Paolo Gentiloni.

The Agreement provides for the development of cooperation between Rosneft and Eni in Russia and abroad in the following areas: exploration and production of hydrocarbons, refining, trading, logistics, marketing and sales, petrochemicals, technology and innovation.

The document reinforces the previous agreements between the two companies, specifically in offshore to drill exploration wells as part of joint projects in the Black and Barents seas.

In addition, the parties will consider further expanding their international cooperation, including the Zohr project offshore Egypt, as well as the potential for joint supplies of refined products to the country.

Rosneft and Eni agreed to assess the potential for cooperation in refining at German refineries where both companies are shareholders, including the optimization of feedstock supplies. The parties also intend to consider using Eni technologies to refine heavy oil residues at Rosneft refineries.

In 2012, Rosneft and Eni signed a Strategic Cooperation Agreement, which provides for joint development of areas in the Black and Barents Sea in Russia, and for Rosneft to participate in Eni's international projects.

In December 2016, Rosneft signed a deal with ENI to acquire a 30% stake in the Concession for the Zohr gas field (with an option to acquire a further 5%), and a 15% stake in the Project Operator. The field is located in Egyptian offshore and is the largest gas discovery of the recent years. Rosneft is therefore becoming a participant in a project to develop Egypt's largest hydrocarbon field, and stands alongside with its global partners: Eni and BP. Once the deals between Rosneft, Eni and BP are completed, the ownership of the Concession Agreement can be structured as follows: Eni – 50%, Rosneft – up to 35%1, BP – up to 15%.

As MRC informed before, in December 2016, Rosneft said it had enough oil to fulfill new contracts with Swiss trader Glencore as markets gear up for a fierce battle between some of the world's largest merchants for supplies from the Russian company. Moscow said then that a consortium of Glencore and Qatar would buy a 19.5% stake in Rosneft for over 10 billion euros in one of the biggest energy deals of 2016.

Rosneft became Russia's largest publicly traded oil company in March 2013 after the USD55 billion takeover of TNK-BP, which was Russia’s third-largest oil producer at the time.
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