Trading Statements

Q1, 2016 Trading Statement

INEOS Group Holdings S.A., 21st April 2016

Q1, 2016 Trading Statement

INEOS Group Holdings S.A. (‘IGH’ or ‘INEOS’) announces its trading performance for the first quarter of 2016.

Based on unaudited management information INEOS reports that EBITDA for the first quarter of 2016 was €554 million, compared to €503 million for Q1, 2015 and €485 million for Q4, 2015.  

North American markets have continued to be strong, taking full benefit from their current feedstock advantage.  Market conditions in Europe have remained good, supported by the continued weakness of the Euro.  In contrast, markets in Asia, and in particular China, have been somewhat weaker.

O&P North America reported EBITDA of €229 million, compared to €269 million in Q1, 2015.  The business has continued to benefit from its flexibility to be able to utilise cheaper NGL feedstocks to maintain healthy margins. Both ethane and propane have continued to be advantaged feedstocks.  The US cracker business environment was strong with healthy margins and high operating rates throughout the quarter. Sales volumes were lower in the quarter due to the inventory build in preparation for a major cracker turnaround in Q2, 2016.  Polymer demand was very solid, particularly polypropylene, with tight markets and high margins.

O&P Europe reported EBITDA of €175 million compared to €71 million in Q1, 2015. Demand for olefins in the quarter was solid with healthy margins.  European polymer demand was very strong in a balanced market, with solid volumes and high margins in the quarter.  The inclusion of the full results of the Noretyl cracker at Rafnes, Norway also had a beneficial impact on the performance for the quarter.

Chemical Intermediates reported EBITDA of €150 million compared to €163 million in Q1, 2015.  Market demand in North America and Europe remained firm for most of the businesses, but was weaker in Asia, where overcapacity has negatively affected earnings. The overall demand trend in the Oligomers business was strong in most product sectors and markets, most notably in the polymer co-monomer segment.  Demand for the Oxide business was solid, although there was some weakness in the solvents markets.  The structural oversupply of Asian markets has continued to impact margins in the Nitriles and Phenol businesses. There was some improvement in demand for the Nitriles business for ABS into the automotive sector and for acrylic fibres.  Demand for the Phenol business was stable, although there was some weakness in caprolactam.

The Group has continued to focus on cash management and liquidity.  Net debt was approximately €6.3 billion at the end of March 2016.  Cash balances at the end of the quarter were €1,826 million, and availability under undrawn working capital facilities was €137 million. Net debt leverage was approximately 2.8 times as at the end of March 2016.