MOSCOW (MRC) -- Olin Corporation reported a third-quarter net loss of USD736.8 million, compared to same year-ago quarter net income USD44.2 million, reported Chemweek.
The loss reflects a USD700 million goodwill impairment charge and weaker chemical results. Net sales were USD1.4 billion, down 8.8% year-on-year (YOY). Reported adjusted EBITDA was USD195.5 million, down 33% YOY on weaker chlor-alkali and vinyls, and epoxy results, offset by stronger Winchester earnings.
Chemical volumes and margins have improved significantly from second-quarter lows, Olin said. "Third-quarter 2020 sales for the chemicals businesses increased sequentially by approximately 17%, and sales have increased every month since the low point in April," said Scott Sutton, Olin president and CEO. "Additionally, Olin drove sequential pricing improvement in the third quarter 2020 for chlorine and almost all chlorine derivatives." Recent price increases for chlorine, epoxy resins, bleach, ethylene dichloride and chlorinated organics are expected to improve margin in the fourth quarter. "Fourth quarter volumes are expected to be challenged based on customer year-end inventory reductions and Olin selectively selling less into poor quality markets, slightly more than offsetting the positives from driving price increases," Sutton said.
Chlor alkali products and vinyls segment sales for the third quarter were USD755.1 million, down 14% YOY. Segment adjusted EBITDA was USD149.9 million, down 36% YOY due to lower ethylene dichloride and caustic soda pricing and lower volumes.
Epoxy sales for the third quarter 2020 were USD476.1 million, down 7% YOY. Segment adjusted EBITDA was USD38.8 million, down 24% due to lower product prices and lower epoxy resin volumes, partially offset by lower raw material costs and operating costs.
Winchester sales for the third quarter 2020 were USD206.4 million, up 9% YOY. Segment adjusted EBITDA was USD31.7 million, up YOY 66% due to higher commercial ammunition volumes and pricing.
As MRC informed earlier, in December 2019, Olin Corporation announced that it plans to permanently shut down a chlor alkali plant with a capacity of 230,000 tons and its Vinylidene Chloride (VDC) production facility, both in Freeport, Texas. These closures are expected to be completed before the end of 2020.
As MRC reported earlier, August production of sodium hydroxide (caustic soda) in Russia were 99,200 tonnes (100% of the basic substance) versus 89,400 tonnes a month earlier, said MRC analysts. Russia's overall output of caustic soda totalled 837,600 tonnes in the first eight months of 2020, down by only 2% year on year.
MRC