2Q22 Performance Highlights
- Record Revenue of US$5,451M, an increase of 23% QoQ and 53% YoY
- Record Reported EBITDA of US$1,010M, up 29% QoQ and 83% YoY
- Reported Net Profit of THB 20.3B, an increase of 44% QoQ and 143% YoY.
- Reported EPS of THB 3.58 (LTM2Q22: 8.11) and Core EPS of THB 2.32 (LTM2Q22:6.16)
Indorama Ventures Public Company Limited (IVL), a global sustainable chemical producer, today reported record 2Q22 earnings as the company’s global integrated model continues to benefit from strong consumer trends and management responded effectively to market disruptions.
IVL posted a record Core EBITDA of US$758 million in the second quarter, up 17% QoQ and 59% YoY. Sales revenue rose by about 11% QoQ on a same-store basis, supporting a Core EBITDA margin of 14%. The combination of strong sales and improved margins helped offset higher energy costs in the U.S. and Europe, while management leveraged the company’s leading position in local and regional markets to ensure uninterrupted customer service levels as higher crude oil prices impacted raw materials costs.
The strong second-quarter performance extends the record profit achieved in 2021 as the company’s differentiated product portfolio grows in line with long-term macro-consumer trends. Most of IVL’s products are used in daily household necessities and are resilient against short-term economic headwinds. This innate stability allows management to continue focusing on the company’s long-term growth strategy of developing its unique global leadership position across its integrated petrochemicals value chain. For example, IVL completed two strategic acquisitions in LATAM and Vietnam in the second quarter, which contributed an additional 12% in revenue growth.
Mr. D K Agarwal, CEO of Indorama Ventures, said, “IVL enjoys market leadership in each of our key business areas in industries that have stable long-term growth prospects. As we demonstrated through the peak pandemic period, our global platform’s unique attributes of resilience and growth means we can stay focused on our long-term plan while at the same time responding quickly to short-term market fluctuations such as the heightened energy costs and supply chain disruptions that have continued into 2022. This, coupled with our continual focus on cost management through transformation programs such as Project Olympus allowed us to improve on our performance in 2Q.”
Combined PET (CPET), the largest of IVL’s three business segments, delivered strong Core EBITDA of US$431 million, up 35% YoY and a 1% decrease QoQ, on high margins driven by seasonally strong demand, supply chain constraints and overall market tightness. Sales revenue increased 13% QoQ on a same-store basis. In April, the company acquired Ngoc Nghia Industry, a leading PET packaging company in Vietnam, expanding IVL’s integrated offering to customers throughout Asia.
Integrated Oxides and Derivatives (IOD) segment achieved Core EBITDA of US$250 million, up 98% QoQ and 152% YoY. Strength in Home and Personal Care and Crop Solutions end-markets drove upside in IOD’s Integrated Downstream vertical, while the Integrated Intermediates vertical was hindered by low ethylene crack margins, historically low integrated MEG margins, and the planned turnaround of two EO units. The acquisition of Brazil-based Oxiteno in April added US$85 million to IVL’s Core EBITDA in Q2 on robust demand for its surfactants and management’s ability to pass on cost increases.
Fibers segment posted Core EBITDA of US$55 million, a decrease of 35% QoQ and 15% YoY, as sales declined 11% QoQ. The segment was impacted by lower demand in the Lifestyle vertical amid the China lockdown while higher freight rates restricted exports. The Hygiene vertical was impacted by volumes at Avgol’s Russia site along with increased polypropylene prices, while strength in the replacement tires market partially offset the ongoing semiconductor shortage, resulting in a stable performance for Mobility.
