Based on unaudited management information, INEOS Enterprises’ EBITDA before Exceptional Items (“EBITDA”) for the fourth quarter 2023 was €51m. This compares to an EBITDA of €72m for the fourth quarter 2022 and €67m in the prior quarter.
Market conditions in the quarter remained challenged, with weak demand across most regions and markets, most notably Europe. Nevertheless, margins upheld through competitive pricing, particularly in our North American businesses. In line with wider INEOS businesses, results were supported by continued cash and fixed cost management across the Enterprises Group.
Pigments’ reported Q4 2023 EBITDA of €28m, compared to €36m in Q4 2022 and €33m in the prior quarter. Q4 2023 EBITDA results included a loss of €(3)m for INEOS Tyssedal which was acquired at the end of the prior quarter. Q4 continued to be adversely impacted by weak Titanium Dioxide demand across all regions, where the housing market remained subdued impacting coatings demand. Tyssedal was similarly impacted by weak demand for Chloride Slag and relatively higher Ilmenite pricing. Margins for Chlorine remained robust in our KOH business and were further supported by higher margins for KOH, driven by robust seasonal demand as a result of a cold and humid winter supporting demand in de-icing as well as lower variable costs.
Composites’ Q4 2023 EBITDA was €38m, compared to €40m in Q4 2022 and €45m in the prior quarter. The business remained resilient and maintained stable margins, particularly in North America, as raw material prices softened. Volumes reduced in line with US seasonality due to Thanksgiving and the Christmas period, alongside Diwali celebrations in India. Europe remained challenged by reduced levels of demand and imported product from cost advantaged regions, resulting in low sales volumes, particularly for UPR products. China experienced similarly weak demand for UPRs, however this was offset by good demand and increased sales volumes in higher-margin VER products into local infrastructure projects including lithium mining.
In Q4 2023, Solvents’ EBITDA loss was €(10)m, compared to a loss of €(7)m in Q4 2022 and a loss of €(6)m in the prior quarter. Results in Q4 contain an unfavourable €(8)m inventory holding loss in the BDO business. Overall challenging market conditions persisted throughout Q4, particularly driven by low European manufacturing demand, resulting in lower margins, which was not offset by the increased demand and higher pricing for IPA and MEK compared to the prior quarter. BDO remained challenged throughout the quarter driven by continued low global demand and cost advantaged imports into the region, resulting in continued lower volumes and weak margins.
Chemical Intermediates reported an EBITDA loss of €(2)m in Q4 2023 compared to a profit of €8m in Q4 2022 and a profit of €2m in the prior quarter. Market conditions at Joliet remained challenging throughout the fourth quarter, particularly in PIA and TMA. This was driven by continued weak demand in North America and lost volumes from cost-advantaged imports from Asia, particularly impacting TMA and PIA. The Compounds business similarly experienced challenging market conditions, with continued weak European demand impacting sales volumes. This was partially offset by strong margins driven by reduced energy and raw material prices and a favourable customer mix.
The results of the Chemical Intermediates division in the quarter were supported by strong fixed cost savings across the three businesses and stable performance in the Calabrian business, particularly in Sulphur Dioxide due to increased demand in the mining industry.
Hygienics reported an EBITDA loss for the quarter of €(3)m which compares to €(5)m in Q4 2022 and €(7)m in the prior quarter. This was reflective of successful marketing campaigns throughout the year and improved margins driven by increased sales volumes of the new higher-margin products compared to both the prior quarter and fourth quarter 2022. The business continued to focus on the product and geographic expansion of its portfolio and development of new product ranges as well as successful integration with key distribution outlets.
In line with our conservative financial policy, we have maintained a prudent capital position with continued control over our operating cost base and capital investment. In Q4, INEOS Enterprises executed a new fungible term loan add-on of c.€645m to the existing 2030 EUR and USD tranches, in order to refinance the remaining Term Loan tranches maturing in 2026. At the end of the quarter, we reported cash balances of €394m and net debt of €1,512m, resulting in a pro-forma, net debt leverage of c.4.4x.