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Hexion loss narrows on higher sales, improving volumes

March 15/2021

MOSCOW (MRC) -- Hexion has reported a fourth-quarter net loss that narrowed to USD35 million, from USD46 million in the year-ago period. Net sales grew 4.0% year on year (YOY), to USD655 million, reported Chemweek.

Segment EBITDA was up 39.6% YOY, to $74 million. Volumes were up, led by increases in formaldehyde, and specialty epoxy and epoxy resins, while pricing cut into sales figures due to higher raw material costs.

In the fourth quarter of 2020, our Adhesives segment reflected continued strength in North America residential construction and gains in our global formaldehyde business, says Hexion chairman and CEO Craig Rogerson. Segment EBITDA in our coatings and composites segment increased more than 100% year over year owing to strong results in specialty epoxy from wind energy demand and versatic acids and derivatives due to increasing demand in architectural coatings, as well as improved results in our base epoxy resins.

Coatings and composites segment sales grew 14.4% YOY, to USD341 million, while segment EBITDA more than doubled, to USD36 million from USD16 million. Adhesives segment sales declined 5.4% YOY, to USD314 million, while segment EBITDA was up 1.8%, to USD58 million.

Looking ahead, we are cautiously optimistic about the global economic conditions considering the potential ongoing impact of the pandemic, Rogerson says. Several key end markets - housing and wind energy in particular - were strong through year-end and those trends have continued in early 2021. The company also expects to pursue M&A in 2021, either bolt-on acquisitions or transformational deals, Rogerson adds.

In September 2020, Hexion announced an agreement to sell its phenolic specialty resin, hexamine and European forest product resins businesses to a private equity consortium. Those businesses have been classified as held for sale and are not included in quarterly results. The deal is expected to close by the end of the first quarter.

As MRC informed before, Hexion, a major American manufacturer of phenol and bisphenol A (BPA), shut down its BPA plant in the Netherlands for scheduled maintenance in early November, 2020. The turnaround at this plant with a capacity of 120,000 mtyear of BPA, located in Pernis, the Netherlands, lasted until the end of November, 2020.

Bisphenol A is used as a hardener in the production of plastics, as well as plastic-based products. It is one of the key monomers in the production of epoxy resins and polycarbonate (PC).

According to MRC's ScanPlast report, Russia's overall consumption of PC granules (excluding exports from Belarus) totalled 8,100 tonnes in January 2021, up by 20% year on year (6,800 tonnes a year earlier).

Hexion Inc., formerly Momentive Specialty Chemicals Inc., is a chemical company based in Columbus, Ohio. It manufactures thermosetting resins and related technologies and specialty products. Hexion has two divisions: the epoxy, phenolic and coating resins division and the forest products division.
Author:Margaret Volkova
Tags:bisphenol a, PC, compounding, sheet extrusion, petrochemistry, coatings, adhesives, paints and coatings, Hexion, Netherlands, Russia, USA.
Category:General News
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