Trading Statements

Trading Statement Q2 2019 - INEOS Styrolution Holding Limited

INEOS Styrolution Holding Limited (‘INEOS Styrolution’) reports its trading performance for the second quarter of 2019.

Based on unaudited management information, INEOS Styrolution’s EBITDA before Special Items (‘EBITDA’) for the second quarter of 2019 is €220 million. This compares to an EBITDA of €226 million in Q2-2018 and to an EBITDA of € 198 million in Q1-2019. The second quarter results were positively impacted by non-cash inventory holding gain (COSA) of approximately €20 million (Q2-2018: loss of €-1 million) because of the increase in crude oil and derivative product prices in the second quarter of 2019.

Our trading results in Q2-2019 improved versus Q1-2019 and are in line with our expectation. Sales volumes increased compared to both Q1-2019 and Q2-2018. The main reasons were our expanded footprint in Asia and good sales in Styrene Monomer and Polystyrene.

In the second quarter of 2019, the Polystyrene EBITDA was €67 million (Q2-2018: €49 million). Overall market demand for Polystyrene was good. Our sales volumes in Polystyrene did make a step change because of the acquired China polystyrene business as of 1 February 2019. The EBITDA contribution of this transaction in Q2-2019 is €14 million (€21 million year-to-date).

The ABS Standard EBITDA in the second quarter of 2019 was €27 million (Q2-2018: €42 million). The ABS market uncertainty continues mainly because of US import tariff threats, which affects sales volumes. The market stabilized and margins improved in Asia compared to Q1/ 19 and Q4/ 18, however not to the very strong margin levels seen in the second quarter of 2018.

The Specialties business EBITDA was €52 million in the second quarter of 2019 (Q2-2018: €61 million). The company saw a decline in sales volumes mainly due to the slow demand from the automotive industry in EMEA and Asia. The company did have strong sales increases in its Household and Electronics focus industries.

Styrene Monomer reported an EBITDA of €74 million in Q2-2019 (Q2-2018: €74 million). From the end of the first quarter until the mid-second quarter, planned maintenance outages were affecting the market. This resulted in a balanced to tighter market with upper mid-cycle margins. All INEOS Styrolution plants were available in the second quarter of 2019.

Net debt was €683 million at the end of June 2019 (Q2-2018 €377 million) with cash balances at €275 million. The company had an additional availability under the undrawn credit facilities of €269 million. Net debt to LTM EBITDA leverage was 0.9 times.