Q3, 2015 Trading Statement
INEOS Group Holdings S.A. October 21st 2015
INEOS Group Holdings S.A. (‘IGH’ or ‘INEOS’) announces its trading performance
for the third quarter of 2015.
Based on unaudited management information INEOS reports that EBITDA for the
third quarter of 2015 was €612 million, compared to €535 million for Q3, 2014 and
€610 million for Q2, 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 generally remained hesitant.
O&P North America reported EBITDA of €259 million compared to €304 million in
Q3, 2014. 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 top of cycle margins and high operating rates throughout
the quarter. A number of competitor plants have now returned from planned and
unplanned outages in the quarter, which has led to an easing of the historically high
margins seen in recent quarters. Polymer demand was very robust, particularly
polypropylene, with tight markets and high margins. In September 2015 the
Chocolate Bayou, Texas site experienced a complete power outage. The units
impacted by the outage are expected to be back in operation by the end of October
O&P Europe reported EBITDA of €212 million compared to €60 million in Q3, 2014.
Demand for olefins in the quarter was strong, with unplanned competitor outages
resulting in tight market conditions. Margins improved significantly in the quarter,
with a strong ethylene / propylene performance. European polymer demand was firm
with solid volumes and good margins in the quarter. In July 2015 the Group acquired
the remaining 50% interest in the Noretyl cracker at Rafnes, Norway from Kerling.
Chemical Intermediates reported EBITDA of €141 million compared to €171 million
in Q3, 2014. Core market demand in North America and Europe remained good for
most of the businesses. The overall demand trend in the Oligomers business was
strong in most product sectors and markets. Demand for the Oxide business was
solid, although the industry supply side has improved as the incidence of unplanned
competitor outages reduced. The market for the Nitriles business was satisfactory,
with some erosion of margins in the quarter as new Asian capacity came on line.
Demand for the Phenol business was reasonable, with the combination of a tight
market in the US and a long market in Europe due to a number of scheduled
turnarounds at derivative plants there. In September 2015 the Group acquired the
aromatics business of Axiall Corporation, which will be integrated in to the Phenol
The Group has continued to focus on cash management and liquidity. Net debt was
approximately €6.0 billion at the end of September 2015. Cash balances at the end of
the quarter were €2,130 million, and availability under undrawn working capital
facilities was €141 million. Net debt leverage was approximately 2.7 times as at the
end of September 2015.