Orbia Advance Corporation released the unaudited Q3 2023 results on 25 October. Orbia’s performance in the period in question reflected weakening market environment in construction, infrastructure and capital investments primarily due to an increasing impact of high interest rates around the globe and lower industrial and construction activity in China. These factors contributed to a more challenging environment for many of Orbia’s businesses in the quarter, which led to lower EBITDA compared with the same quarter last year. Nevertheless, the company continued to generate strong operating cash flow and maintained a solid balance sheet in the third quarter.
The revenues of Orbia polymer solutions business (Vestolit and Alphagary brands) dropped 19% year on year to $677 million in Q3 2023. EBITDA of $86 million plummeted by 26% and EBITDA margin by 122 basis points to 12.7%. The decrease in revenues was primarily triggered by weaker market conditions and lower PVC and caustic soda prices. This was partly offset by an increase in general resins volumes, particularly in Latin America. The reduced prices resulted from weaker construction markets tied to higher interest rates as well as the global impact of weakness in China. EBITDA was lower primarily due to lower selling prices, while the business continued to manage its costs and operations.
The revenues of Orbia’s building and infrastructure business (Wavin brand) slipped at an annualised rate of 1% to $694 million. EBITDA of $79 million increased by 13% and EBITDA margin by about 143 basis points to 11.4%. The revenues declined slightly owing to the impact of high interest rates that resulted in lower demand in the construction and the infrastructure sectors, particularly in Europe and North America. This was partly offset by a volume improvement in the Latin American and Asian markets. Increased EBITDA stemmed from lower cost of raw materials, cost optimisation and the contribution from recent acquisitions such as Bow Plumbing Group.
Eni has reported Q3 2023 adjusted profit before tax of €3.3 billion in a weaker scenario, (the Brent price is down 14% and the benchmark gas price is down over 80%), still showing another strong set of results driven by continuing underlying improvements. This measure was €11.9 billion in the first nine months of this year.
In the Chemicals business managed by Versalis, an adjusted operating loss was €198 million in Q3 2023, down €21 million from Q3 2022. This resulted from lower demand across all business segments and market uncertainties, holding back purchasing decisions by resellers, and continued competitive pressure of product streams exported by other geographies. In the first nine months of 2023, the adjusted operating result was a loss of €377 million versus €167 million in the corresponding period of 2022, reflecting exceptionally adverse market conditions.
Sales of chemical products were 760,000 t in Q3 2023, down 2% compared with the same period of 2022, impacted by lower product availability following the shutdown of Marghera and Priolo sites and opportunistic ones of polymer plants due to slacker demand across all business segments. In January—September 2023, sales amounted to 2.34 million t, 21% below the January—September 2022 level. In Q3 2023, cracking margin decreased compared to the same period in 2022. Also margins on polyethylene and styrenics decreased compared to Q3 2022, amid weak commodity prices.
The average plant utilisation rate of chemicals moved 5% down quarter on quarter and 2% down year on year to 50% in Q3 2023.
LyondellBasell Industries has reported Q3 2023 net income of $747 million, or $2.29 per diluted share. During the quarter, the company recognized identified items of $57 million, net of tax. These items impacted the second quarter earnings by $0.17 per share. Q3 2023 EBITDA was $1.4 billion.
Global olefins and polyolefins margins were squeezed by higher feedstock costs, tepid polymer demand in both the United States and Europe and new industry capacity. PE exports from North America increased as global trade flows continued to normalise towards pre-pandemic levels.
In September, LyondellBasell launched +LC (Low Carbon) solutions for select chemical products, including propylene oxide, styrene and other products sourced from recycled and renewable-based feedstock. The company is providing +LC solutions to meet the growing customer demand for sustainable materials that have a lower greenhouse gas (GHG) footprint relative to fossil-based alternatives. In addition, with a new solar power purchase agreement in Spain, the company rapidly achieved 78% of its goal to procure half of its electricity from renewable sources by 2030.
In Q4 2023, the company expects seasonally softer demand across most businesses. Higher feedstock costs, new industry capacity and the slow pace of demand growth in China continue to erode global olefins and polyolefins margins. Oxyfuels and refining margins are expected to decrease following the conclusion of the summer driving season. Nonetheless, oxyfuels margins are expected to remain well above historical averages. In Q4, LyondellBasell expects to operate its assets in line with market demand, keeping operating rates at an average of 85% for North American olefins and polyolefins (O&P), 75% for European O&P and 70% for Intermediates and Derivatives assets.
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