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Indorama Ventures reports lower profit on higher volume

November 20/2020

MOSCOW (MRC) -- Indorama Ventures Public Company Limited (IVL), a global chemical producer, has announced its third quarter 2020 financial results, said the company.

Reported net profit is THB 380 million in 3Q20 and THB 1,104 million for 9M20. Our performance this year provided us significant insights into the growth of the future market, while the company remains on a path towards enhanced incremental performance progress, from 4% ROCE towards our target ROCE of 15% by 2023.

In 3Q20 we delivered record sales volume of 3.6 million tonnes, registering growth of 18% year-on-year (YoY). Sales volume grew to 3.2 million tonnes, or 4% YoY on a comparable basis. This continuous volume growth is a clear indication of the resilient nature of the companys products and the global access we have to our customers.
IVL achieved an operating cash flow of USD 354 million in 3Q2020 while operating cash flow for 9M20 was USD994 million, thus providing us ample liquidity of USD 2.5 billion in cash and cash equivalents as well as unused credit lines.
Project Olympus (a business transformation and cost excellence project) delivered a savings of USD 21 million in 3Q20 and USD 64 million in 9M20. Our full year budget of USD 76 million in savings is expected to exceed targets by over 15% in 2020 with relentless focus on multiple initiatives.

IVL has embarked in 2020 on a transformation journey that will enhance its business excellence and aims to deliver US$ 582 million of additional, sustainable, EBITDA by 2023. This target has been expanded from the US$ 352 million announced at our Capital Markets Day at the start of 2020 after a rigorous analysis process and the support of relevant domain experts to validate our operating teams initiatives in all of our three major business segments globally.

We are making progress towards our ESG targets and our pledge to recycle 750,000 tonnes of post-consumer PET, with a commitment of USD 1.5 billion towards our ESG and recycling infrastructure globally by 2025.
We have strengthened our leadership and recruited both digital and Lean Six Sigma function leaders to support technological adaption across IVL.

IVL is well on its way to implement S4 Hana (ERP) across our global operations and introduced a Global Business Service (GBS) office which will hallmark the delivery of our transformation journey.

As MRC informed earlier, Indorama Ventures Sines, a subsidiary of the world leader in the production of polyethylene terephthalate (PET) - Indorama Ventures Company Ltd (IVL), plans to halt production at the refined terephthalic acid (TPA) plant in Sines (Sines, Portugal) in mid-November to conduct planned preventive measures. Repair work at this enterprise with a capacity of 700,000 tonnes/year of TPA per year will continue for one month. Thus, this plant should return to work in mid-December this year.

As per ICIS-MRC Price Report, buying activity has improved in the Russian market of PET chips this week. Most producers reported a limited volume of free PET in the spot market. Converters' opinions regarding November demand in the preforms market differed. Some of them reported good sales, while others reported  that demand was low and they have to sell preforms at a price close to their cost.

Indorama Ventures Public Company Limited, listed in Thailand (Bloomberg ticker IVL.TB), is one of the worlds leading petrochemicals producers, with a global manufacturing footprint across Africa, Asia Pacific, Europe and Americas. The companys portfolio comprises Integrated PET, Olefins, Fibers, Packaging and Specialty Chemicals. Indorama Ventures products serve major FMCG and automotive sectors, i.e. beverages, hygiene, personal care, tire and safety segments. Indorama Ventures has approx. 24,000 employees worldwide and consolidated revenue of US$ 11.4 billion in 2019. The Company is listed in the Dow Jones Emerging Markets and World Sustainability Indices (DJSI).
Author:Anna Larionova
Tags:PET-granulate, terephthalic acid, PET bottles, PET films, PET preforms, Indorama Ventures PLC.
Category:General News
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