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Borealis 2019 profit, sales suffer on lower Asian polyolefins prices

February 28/2020

MOSCOW (MRC) -- Borealis announces a net profit of EUR 138 million for the fourth quarter of 2019, compared to EUR 94 million in the same quarter of 2018, said the company.

While the 2018 result was impacted by a one-off impairment charge of EUR 92 million, the result in the fourth quarter of 2019 was driven by a soft polyolefins market in Asia, lowering the contribution from Borouge. At the same time, the improved performance of the Fertilizer, Melamine and Technical Nitrogen Products segment partially mitigated the negative impact of weakening integrated polyolefins margins in Europe during the last quarter of 2019.

For the full year 2019, the company recorded a net profit of EUR 872 million, compared to EUR 906 million in 2018. The 2019 result was negatively impacted by a lower polyolefins price environment in Asia, which affected the contribution from Borouge. However, the negative impact was limited due to healthy integrated polyolefins margins in Europe together with improved results in the Fertilizer, Melamine and Technical Nitrogen Products segment.

In the fourth quarter, net debt rose by EUR 212 million. Over the full year 2019, net debt increased by EUR 241 million, driven largely by the high investment level related to growth projects and the payment of a EUR 525 million dividend for 2018 and a EUR 300 million interim dividend for 2019 to Borealis shareholders. The cash inflow from the solid business result and dividends from Borouge enabled Borealis to keep its financial position strong, with a gearing of 24% at year-end 2019.

Earlier it was reported that Borealis plans to stop the production of phenol and acetone on April 12 at a site in Porvoo (Porvoo, Finland) for scheduled repairs. This enterprise with a capacity of 195 thousand tons of phenol and 120 thousand tons of acetone per year will be closed for repairs until May 27.

According to MRC's ScanPlast, Russia's HDPE production amounted to 868,500 tonnes in 2019, down 10% year on year. All manufacturers reduced operating loading, primarily due to long repair shutdowns.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals, fertilizers and melamine. With its head office in Vienna, Austria, the company currently has 6,900 employees and operates in over 120 countries. Borealis generated EUR 8.1 billion in sales revenue and a net profit of EUR 872 million in 2019.


mrcplast.com
Author:Anna Larionova
Tags:PP, PE, Borealis.
Category:General News
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