Trading Statements

Q2, 2013 Trading Statement

INEOS Group Holdings S.A. July 24th, 2013

INEOS Group Holdings S.A. (‘IGH’ or ‘INEOS’) announces its trading performance for the second quarter of 2013.

Based on unaudited management information INEOS reports that EBITDA for the second quarter of 2013 was €365 million, compared to €308 million for Q2, 2012 and €415 million for Q1, 2013.

The results of the Group have continued to be adversely impacted in our O&P Europe and Chemical Intermediates businesses by the fire on a compressor at the cracker in Lavera in December 2012.  The cracker resumed partial operations in March 2013 and continued at this level throughout the second quarter.  The partial closure has impacted the results by €24 million in the second quarter.  It is currently expected that the cracker will return to full operations towards the end of the third quarter.

North American markets have continued to show a strong demand trend, taking full benefit from their current feedstock advantage.  In contrast the industry sentiment in Europe and Asia has remained hesitant.

O&P North America reported EBITDA of €221 million compared to €132 million in Q2, 2012. The business benefited again from its flexibility to be able to utilise cheaper NGL feedstocks to maintain healthy margins.  The US cracker business environment was strong with top of cycle margins and high operating rates throughout the quarter.  Polymer demand was solid, supported by an improving US economy.

Chemical Intermediates reported EBITDA of €104 million compared to €119 million in Q2, 2012. Chemical Intermediates experienced a mixed performance in the quarter.  The overall demand trend in the Oligomers business was mixed, with continued strength in North America offset by some weakness in Asia. The Oxide business had a stable performance for the quarter with solid EO demand offset by soft demand for solvents.  Demand for the Phenol business was subdued in most sectors, although margins have remained stable. The Antwerp plant had a scheduled turnaround in the quarter. Volumes for the Nitriles business were weak coupled with low margins, although there has been some recent improvement in demand for ABS in the US.  The partial closure of the cracker in Lavera during the quarter adversely impacted the results of the Oxide and Oligomers businesses by €7 million.

O&P Europe reported EBITDA of €40 million compared to €57 million in Q2, 2012.  Demand for olefins in the quarter was subdued with industry cracker operating rates remaining trimmed.  Butadiene demand has lessened in line with depressed European tyre demand.  Margins were relatively steady in the quarter.  Underlying demand for polymers remained bearish, with low margins, although some restocking demand has been in evidence in the latter part of the quarter .  The partial closure of the cracker in Lavera during the quarter adversely impacted the results by €17 million.

In May 2013 the Group successfully completed a repricing and upsizing of its Senior Secured Term Loans, together with an issue of Senior Notes due 2018.  The Group issued additional term loans of $640 million and €350 million.  The net proceeds from the additional term loans were used to repay in full the Senior Secured Notes due 2015.  The interest rates on the Senior Secured Term Loans were also reduced as part of the refinancing.  The Group issued $678 million and €500 million Senior Notes due 2018.  The net proceeds from the notes were used to repay all of the Dollar Senior Notes due 2016 and a proportion of the Euro Senior Notes due 2016.  The refinancing should result in annual interest savings of approximately €110 million.

The Group has continued to focus on cash management and liquidity.  Net debt was approximately €6.5 billion at the end of June 2013.  Cash balances at the end of the quarter were €1,092 million, and availability under undrawn working capital facilities was €250 million. Pro forma for the impact of the Lavera outage, net debt leverage was approximately 4.1 times as at the end of June 2013.