Trading Statements

Q3, 2019 Trading Statement

Q3, 2019 Trading Statement

INEOS Group Holdings S.A. (‘IGH’ or ‘INEOS’) announces its trading performance for the third quarter of 2019.

Based on unaudited management information INEOS reports that EBITDA for the third quarter of 2019 was €514 million, compared to €631 million for Q3, 2018 and €501 million for Q2, 2019.   

North American markets were solid, taking full benefit from their current feedstock advantage.  Market conditions in Europe have remained flat, but markets in Asia have seen some weakness in the quarter. General market conditions have been largely consistent with the first half of the year.

O&P North America reported EBITDA of €215 million compared to €233 million in Q3, 2018.  The business has continued to benefit from its flexibility to be able to utilise cheaper NGL feedstocks to maintain margins. The US cracker business environment was generally solid with good operating rates throughout the quarter.  Ethylene markets remained long, with increased supply availability impacting margins.  Polymer demand was generally good, with balanced markets and solid margins.

O&P Europe reported EBITDA of €159 million compared to €171 million in Q3, 2018.  Demand for olefins in the quarter was firm, aided by a number of scheduled competitor turnarounds constraining supply during the quarter.  European polymer demand was stable, but increased competition from imports impacted volumes and margins in the quarter.

Chemical Intermediates reported EBITDA of €140 million compared to €227 million in Q3, 2018. The overall demand trend in the Oligomers business was good across many product sectors and markets, with particular strength in co-monomers. Demand for the Oxide business was generally flat.  Lower glycol margins due to weak Asian demand were largely offset by shifting production to other EO derivatives.  The markets for the Nitriles business were reasonably balanced with some weakness in ABS and acrylic fibre demand due to the automotive sector and trade tariff concerns.  Volumes were adversely impacted by the scheduled outages at the Seal Sands, Lima and Koln facilities, together with the delayed start-up of the Green Lake facility and refilling of the supply chain during the quarter.  Demand for the Phenol business was solid, with some weakness in margins due to lower returns on acetone.

The Group has continued to focus on cash management and liquidity.  Net debt was approximately €5.6 billion at the end of September 2019.  Cash balances at the end of the quarter were €1,179 million, and availability under undrawn working capital facilities was €223 million.  Net debt leverage was approximately 3.0 times as at the end of September 2019.