Borealis has announced a net profit of €92 mln for Q2-2010, a further improvement compared to €54 mln in Q1-2010, as well as when compared to Q2-2009. Net profit was reported at €146 mln year to date; vs €35 mln during the same period in 2009.
Feedstock prices came down after a peak in April while polyolefin market prices continued to increase leading to improved industry margins. European polyolefins industry sales volumes are in line with previous years' sales levels. Borealis' sales volumes increased quarter-on-quarter in most market segments compared to the first quarter of 2010. The Base Chemicals business group positively contributed to the result with volume growth and improved margins in the feedstock and olefins business. The melamine and plant nutrients business also showed improved sales volumes and profitability compared to the first half of 2009.
Backed by its strong financial position and its two owners IPIC and OMV, Borealis continues with its investment program across its portfolio of products and regions. In the Middle East, Borouge, Borealis' joint venture in Abu Dhabi, has initiated the start up of its Borouge 2 operations as planned. The new world-scale ethane cracker, Olefins Conversion Unit, and polyethylene (PE) unit have all been successfully started and the polypropylene (PP) units, the first at the plant, will follow shortly. Once fully operational, the expanded plant will have the capacity to manufacture 2 mln tpa of polyolefins. During the quarter, contracts valued at US$ 3.7 bln were awarded for the Borouge 3 mega-project in Abu Dhabi, thereby underpinning the further expansion of the plant's production capacity to 4.5 mln tons by the end of 2013. Borouge also celebrated the groundbreaking of its Abu Dhabi innovation centre and the inauguration of its first compounding plant in China, in addition to announcing its plans to build a second plant by 2012.
Borealis also continues to develop its European assets. Over the next three years €145 mln will be invested in the melamine and plant nutrients production in Linz, Austria, while at the same time internal efficiency and profitability of the site will be increased. The new LDPE plant in Stenungsund, Sweden was started-up and was officially inaugurated on June 2. The investment of over €400 mln will further secure Borealis' position serving the growing wire and cable market.
"Our start-ups in Europe and the Middle East are progressing well which gives us confidence for the future," says Borealis Chief Executive Mark Garrett. "However, as the world economy remains volatile we need to remain cautious in the short term. Thanks to our liquidity and the commitment of our owners we are able to continue to invest in our future, in Europe and in the Middle East. At the same time, we will continue to focus on operational excellence and safety which stays our top priority at all times."