Sherwin-Williams earnings jump on higher DIY paint demand

MOSCOW (MRC) -- Sherwin-Williams (SW) reported third-quarter net income up 22.4% year-on-year (YOY), to USD705.8 million, on net sales up 5.2%, to USD5.12 billion, said Chemweek.

Adjusted earnings totaled USD8.29/share, beating analysts’ consensus estimate of USD7.75/share, as reported by Refinitiv (New York, New York). Higher sales for architectural paint, especially residential repaint and do-it-yourself (DIY) paint, drove the increases.

"Continued and unprecedented strength in our DIY business, solid demand across our residential repaint and new residential segments, and improving demand in our industrial coatings businesses and regions drove our strong third quarter results," says SW chairman and CEO John Morikis. “Improving sales, coupled with favorable customer and product mix, lower input costs and ongoing continuous improvement efforts, drove strong double-digit growth in EBITDA and diluted net income per share."

Americas segment sales grew 2.8% YOY, to USD2.98 billion, while segment profit increased 12.6%, to USD747.4 million. “The increase in the quarter was due primarily to higher residential repaint, DIY and new residential paint sales in the U.S. and Canada, partially offset by the impacts of COVID-19 on demand in some end market segments served,” SW says.

Performance coatings segment sales were up 1.2% YOY, to USD1.31 billion, while segment profit rose 12.9%, to USD155.3 million. Higher volumes and improving demand drove the increases, with particularly strong results in the packaging and wood business lines.

Consumer brands segment sales increased 23.5% YOY, to USD838.1 million, while segment profit grew 72.6%, to USD198.3 million. Sales and profits were boosted by higher sales volumes to retail customers, especially in North America and Europe.

SW is increasing its full-year 2020 earnings guidance to USD21.49-21.79/share, compared with guidance of USD20.96-21.46/share previously, due to continued strong demand, particularly in DIY residential businesses. This compares with full-year 2019 earnings of USD16.49/share. For the fourth-quarter, net sales are expected to increase by 3-7% YOY. Quarterly earnings guidance was not disclosed.

As MRC informed earlier, Heat-FlexTM Hi-Temp 1200 from Sherwin-Williams was chosen as the single coating protection against corrosion and high heat for the oil and gas bulk valves at Saudi Aramco’s Ras Tanura refinery. Experts from Sherwin-Williams collaborated with contractor Tecnicas Reunidas on the clean fuels and aromatics project to protect bulk valves for all process conditions and temperatures and ensure fault-free continuous operations at the facility near the industrial port city Jubail in Saudi Arabia.

We remind that Russia's output of chemical products rose in September 2020 by 6.7% year on year. At the same time, production of basic chemicals increased by 6.1% year on year in the first nine months of 2020, according to Rosstat's data. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-September output. Last month's production of primary polymers decreased to 852,000 tonnes from 888,000 tonnes in August due to shutdowns in Tomsk, Ufa and Kazan. Overall output of polymers in primary form totalled 7,480,000 tonnes over the stated period, up by 16.4% year on year.

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MOSCOW (MRC) -- Specialty chemicals producer Elementis (London, UK) has rejected a GBP621-million (USD819 million) all-cash buyout offer from Minerals Technologies (New York, New York), saying the valuation for the company is too low, according to Chemweek.

Elementis’s board confirms it received a proposal on 5 November from Minerals Technologies for a possible cash offer of 107 pence per share, and says it has unanimously rejected the conditional proposal as it “significantly undervalued Elementis and its future prospects.” There can be “no certainty either that an offer will be made nor as to the terms of any offer, if made. A further announcement will be made when appropriate,” it adds.

The offer represents a premium of 31% to the closing price of 81.70 pence per Elementis share on 4 November, according to Minerals Technologies. Elementis has over 580 million issued shares at present.

Mineral Technologies says it is “currently considering its position” following the rejection of its offer, adding that its proposal represents a premium of 47% to Elementis’s 90 trading-day volume weighted average share price of 72.66 pence as of market close on 4 November. “However, any offer would be likely to be solely in cash,” it says.

Elementis, founded in 1844, manufactures additives for products in the consumer and industrial markets, including personal care, coatings, chromium, energy, and talc. Rothschild & Co. is acting as financial advisor to Elementis. The company in October reported lower volumes year on year for the third quarter, with a sequential improvement in trading compared with the second quarter.

Minerals Technologies is required in accordance with stock market regulations by 10 December to announce either a firm intention to make an offer for Elementis or that it does not intend to proceed.

As MRC reported earlier, Elementis has just entered an exclusive distribution agreement with DKSH (Zurich, Switzerland), a holding company specializing in market expansion services, for personal care applications in the French market.

We remind that Russia's output of chemical products rose in September 2020 by 6.7% year on year. At the same time, production of basic chemicals increased by 6.1% year on year in the first nine months of 2020, according to Rosstat's data. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-September output. Last month's production of primary polymers decreased to 852,000 tonnes from 888,000 tonnes in August due to shutdowns in Tomsk, Ufa and Kazan. Overall output of polymers in primary form totalled 7,480,000 tonnes over the stated period, up by 16.4% year on year.

Elementis plc is one of the UK's largest speciality chemicals business. The Company comprises three businesses: Specialty Products, Surfactants and Chromium. Both Specialty Products and Chromium hold leading market positions in their chosen sectors. Elementis employs over 1,200 people at more than 30 locations worldwide.
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MOSCOW (MRC) -- Honeywell has announced the introduction of an advanced industrial training solution that combines 3D immersive technology with industry-leading operator training simulation to create a collaborative learning environment for plant operators and field technicians, said Hydrocarbonprocessing.

Honeywell’s Immersive Field Simulator is a virtual reality (VR) and mixed reality-based training tool that incorporates a digital twin of the physical plant to provide targeted, on-demand, skill-based training for workers. “Faced with increasingly complex technology and an experienced workforce nearing retirement, operators need robust technical training and development solutions that accurately depict real-world environments,” said Pramesh Maheshwari, vice president and general manager, Lifecycle Solutions and Services, Honeywell Process Solutions. “Traditional training approaches often fail to meet the mark when it comes to helping panel and field operators and maintenance technicians in process plants become better at their jobs. The result can be reliability issues and increased operational incidents."

The Immersive Field Simulator offers a smooth, virtual walkthrough to familiarize workers with the plant. It includes avatars that represent virtual team members. The simulator’s cloud-hosted, device-agnostic platform, which incorporates flexible 3D models, grows with the user as plant operations change. The simulator is customizable to meet specific instructional needs and project team members and plant subject matter experts can easily create customized training modules.

Honeywell’s Immersive Field Simulator transforms training for today’s digital-native workforce, enabling employees to learn by doing while increasing knowledge retention, minimizing situations that can result in operational downtime improving competencies across a variety of areas.

"With our end-to-end solution, console and field operators can practice different operating and safety scenarios, including rare but critical situations, in a safe, simulated environment,” said Maheshwari. “This approach significantly improves upon current training tools and methods. VR-based training boosts confidence and retention while improving overall professional skills. Experience shows that students using VR can learn significantly faster than in the classroom."

Honeywell’s Competency Management program, which includes the simulator training, is built upon decades of workers’ experiences using integrated control and safety systems. Honeywell has incorporated this experience into state-of-the-art competency-based offerings that improve worker performance and safety.

As MRC informed earlier, Honeywell UOP has announced that French energy company Total will utilize Honeywell UOP’s Ecofining process technology to produce renewable fuels, primarily for the aviation industry, at its Grandpuits platform at Seine-et-Marne in north central France. Once completed, the bio-refinery will process 400,000 tons of feed per year, producing up to 170,000 tons of sustainable aviation fuel, 120,000 tons of renewable diesel and 50,000 tons of renewable naphtha for production of bioplastics.

We remind, Honeywell announced Zhenhua Petrochemical Co. Ltd will use Honeywell UOP’s C3 Oleflex technology for propane dehydrogenation to process 1 million metric tons per year of polymer-grade propylene for a proposed plant in Dongying City, Shandong Province, China.

As MRC reported earlier, in May, 2020, Honeywell announced that Enterprise Products Partners L.P. will use Honeywell UOP’s C3 Oleflex technology in its second propane dehydrogenation plant, called "PDH 2". Located near Mont Belvieu, Texas, PDH 2 will produce 750,000 metric tons per year of polymer-grade propylene as part of Enterprise’s expansion of propylene manufacturing capacity.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers" inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

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MOSCOW (MRC) -- India’s fuel consumption in October registered its first year-on-year increase since February, as slowing coronavirus cases and increased mobility accelerated an economic recovery, reported Reuters.

Consumption of refined fuels, a proxy for oil demand, rose 2.5% in October from the prior year to 17.78 million tons and nearly 15% higher from the previous month, data from the Petroleum Planning and Analysis Cell (PPAC) of the Ministry of Petroleum & Natural Gas showed.

“GST (Goods and Services Tax) collections, power demand, PMI etc all are indicating increased economic activity and COVID cases are also coming down to a point where demand is coming back to normalcy,” said K Ravichandran, senior vice president at ICRA, a unit of Moody’s Investors Service.

With public transportation gradually picking up, fuel demand is expected to improve further, he added.

India's fuel consumption rises for 2nd straight month.

India’s daily COVID-19 case count has steadily declined since September, although total cases remain north of 8.5 million- the second highest in the world.

Activity in India’s dominant services industry also expanded for the first time in eight months in October as demand surged.

Diesel consumption, a key parameter linked to economic growth and which accounts for about 40% of overall refined fuel sales in India, rose 7.4% to 6.99 million tons on an annual basis, and climbed about 27% month-on-month.

Sales of gasoline, or petrol, rose by 4.3% from a year earlier to 2.65 million tons, and by 8.2% from 2.45 million tons from September.

Cooking gas or liquefied petroleum gas (LPG) sales increased by 3% to 2.42 million tons from a year earlier and 6.6% from the previous month, while naphtha sales rose 15% to 1.30 million tons and about 14% month-on-month.

Sales of bitumen, used for making roads, rose about 47% versus last year, and fuel oil increased by about 12.8% last month.

As MRC informed previously, India’s top refiner Indian Oil Corp has been operating at 100% capacity since early November as local fuel demand has recovered.

We remind that IOC is expanding its petrochemical capacity by more than 70 per cent from its current 3.2 million tonnes a year. It is also on new technologies that reduces the cost of producing petrochemicals.

Ethylene and propylene are feedstocks for producing PE and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
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MOSCOW (MRC) -- Chevron Corp will lay off about 25% of Noble Energy's employees who joined the oil major after its USD4.1 billion purchase of the smaller rival earlier this month, the company announced, said Hydrocarbonprocessing.

A collapse in crude oil prices has forced most oil and gas producers to drastically cut costs by laying off thousands of employees and cutting down on drilling. For many companies, consolidation with larger players at low or no premiums is becoming the only option to survive.

The job cuts, which are on top of Chevron’s plan to reduce 10%-15% of its own workforce, come after the company promised to lower its operating expenses by USD1 billion this year to cope with the downturn. Chevron’s 10%-15% cuts would imply a reduction of between 4,500 and 6,750 jobs, while job cuts at Noble will reduce the total workforce by roughly another 570 positions.

Most of the cuts will take place this year, Chevron said in an email. Chevron’s purchase of Noble boosted its investments in U.S. shale patches of Colorado and the Permian basin and gave the company a foothold in Israel through Noble’s flagship Leviathan project, the largest natural gas field in the eastern Mediterranean.

The company, which took a USD1 billion charge earlier this year to cover severance payments, has also been in the process of asking employees worldwide to reapply for their positions as part of a cost-cutting program, Reuters reported this month.

As part of the plan, Chevron also plans to lay off more than 50 employees starting Dec. 14 in both its Bakersfield production unit and the El Segundo refinery, according to a notice the company sent to the state of California. About 700 employees will lose jobs in Houston starting this month, according to a filing with the Texas state.

Chevron had begun streamlining its operations at the end of 2019 when investor pressure was mounting on oil producers over their abysmal returns. Reuters also reported exclusively on Tuesday that Cenovus Energy Inc plans to cut 20% to 25% of its workforce after it acquires Husky Energy Inc.

As MRC informed earlier, Chevron Lummus Global (CLG) announced they have been awarded a contract by China's largest oil and gas producer and distributor, PetroChina Company Limited, for the supply of its proprietary ISOMIX-e reactor internals for two of their RDS units in Liaoning Province.

As MRC reported earlier, Chevron Phillips Chemical, part of Chevron Corporation, still has not lifted force majeure on its polyethylene (PE) products after assessing the impact of Hurricane Laura to its Gulf Coast PE operations. The force majeure circumstances were declared on 1 September, 2020. CP Chem operates a 420,000 mt/year high-density polyethylene (HDPE) plant in Orange, Texas, and an 855,000 mt/year cracker in Port Arthur. The company plans to minimize the impact of the event and return to full PE deliveries as soon as possible.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,496,500 tonnes in the first eight months of 2020, up by 5% year on year. Shipments of all ethylene polymers increased, except for linear low desnity polyethylene (LLDPE). At the same time, PP shipments to the Russian market reached 767,2900 tonnes in the eight months of 2020 (calculated using the formula - production minus exports plus imports - and not counting producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

Chevron Corporation is the the second-largest integrated energy company in the United States and among the largest corporations in the world. Chevron is involved in upstream activities including exploration and production, downstream activities including refining, marketing and transportation, and advanced energy technology. Chevron is also invested in power generation and gasification processes.
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