Arkema reports first-quarter results
Colombes, France – Arkema records robust EBITDA for first-quarter 2024, in line with its full-year guidance, in a broadly unchanged economic environment with sales of €2.3 billion, down by 7.3% year-on-year: Slight volume growth in the 3 Specialty Materials segments (+2.7%); Good momentum in certain markets such as structural bonding, sports, automotive and energy; Negative 8.4% price effect in Specialty Materials, mainly reflecting lower raw material prices and still unfavorable market conditions in upstream acrylics and PVD.
Following Arkema’s Board of Directors’ meeting held on 6 May 2024 to review the Group’s consolidated financial information for the first quarter of 2024, Chairman and CEO Thierry Le Hénaff said, “In a context in continuity with that of Q4 2023, financial performance was solid and EBITDA close to that of first-quarter 2023. Arkema focused on tightly managing its operations and continuing to make progress on its main ongoing projects, in order to reap the initial benefits thereof this spring.
The start of 2024 was also marked by a significant new milestone for our Adhesive Solutions segment, with the highly value-creative planned acquisition of Dow’s adhesives business for flexible packaging. With its leading technologies and top-quality manufacturing facilities, this product line will perfectly complement our offering in high-tech industrial adhesives, as was the case with the acquisition of Ashland’s adhesives two years ago.
Finally, we are continuing our efforts to decarbonize our value chain with the signature of several new green electricity supply agreements.”
As of today, the macroeconomic environment remains marked by a lack of visibility and ongoing geopolitical tensions, with no clear signs yet of a rebound in demand. In this context, Arkema will focus primarily on internal momentum, and will benefit notably from the second quarter onwards from the gradual ramp-up of several high-stake organic growth projects and of PIAM. Second-quarter EBITDA is expected to be slightly higher relative to second-quarter 2023 and therefore significantly higher than Q1’24.
Complemented by the start-up of the 1233zd fluorospecialties unit in the United States from this summer, the Group’s major industrial projects should gradually ramp up and contribute around €60 to €70 million in EBITDA for the full year. The Group confirms that production levels at the PA11 plant in Singapore and the Nutrien HF site are progressing well, and that these units should be fully operational by the end of the second quarter. Benefiting also from its cutting-edge innovation and the positive dynamic in adhesives, Arkema thus reaffirms its full-year guidance and aims to achieve in 2024 a higher EBITDA, estimated at between €1.5 billion and €1.7 billion depending on the level of recovery in demand, and with seasonality more weighted to the second half of the year.
Moreover, the Group will continue to implement its strategic roadmap unveiled at the Capital Markets Day in September 2023, paying particular attention to the implementation of its other major industrial projects, namely the increase in organic peroxide capacity in China, the construction of the DMDS unit in the United States, and the decarbonization of acrylics production in France. It will also continue to strengthen, in partnership with its customers, its innovation efforts in solutions for a less carbonized and more sustainable world, and pursue the implementation of its climate plan.