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Huntsman plans to reduce its European TiO2 capacity by 13%
STRATEGIES
benefit from backward integration into the site, allowing high delivery reliability and maximizing efficient use of energy and feedstock, the partners say. 2-EH acid is a chemical intermediate used in numerous applications, including the production of plasticizers, stabilizers and catalysts. ‘With this new plant, we are responding to our customers’ growing demands in Asia Pacific. Through this additional capacity BASF will become one of the leading suppliers for high purity 2-EH acid in the region’, says Stefan Blank, president of BASF’s intermediates division. BASF already operates a 2-EH acid production unit at its Ludwigshafen site in Germany. BASF, which is celebrating its 150th anniversary this year, had sales of E74.3 billion in 2014, up 0.5% from almost E74 billion the previous year. Sales volumes rose 4% but prices overall decreased by 3% and negative currency effects ‘dampened sales’ in almost all divisions, the company says. EBIT before special items rose 4% year on year to E7.4 billion in 2014, primarily due to a larger contribution from the chemicals business, comprising the chemicals, performance products, and functional materials & solutions segments, BASF reports. Net income amounted to E5.2 billion last year, exceeding 2013’s level of E4.8 billion. The group employed around 113 000 staff as of the end of the year. In 4Q 2014, BASF’s sales dipped 0.6% to E18.0 billion but sales volumes increased by 1% and EBIT before special items rose 2.8% to E1.5 billion. Net income for the quarter rose 25.7% to E1.42 billion from E1.13 billion in 4Q 2013. Contact: BASF SE, Ludwigshafen, Germany. Tel: +49 621 60 0, Web: www.basf.com Or contact: BASF Petronas Chemicals Sdn Bhd, Kuantan, Pahang, Malaysia. Tel: +609 585 5000, Web: www.basf-petronas.com.my
Huntsman plans to reduce its European TiO2 capacity by 13%
H
untsman Corp, one of the world’s largest producers of titanium dioxide (TiO2) pigments, is planning to reduce its European TiO2 capacity by approximately 100 000 tonnes/year, representing 13% of its TiO2 capacity on the continent. According to the company, the plan will generate approximately US$35 million in annual savings. Having considered different options, Huntsman is proposing to close specific operations at its Calais site in France. The
April 2015
plan is to discontinue the so-called ‘black end’ manufacturing operations – responsible for the start of the TiO2 production process – and ancillary activities at the site during 2015. The ‘white end’, which is used to finish and pack TiO2, would remain operational, employing up to 100 people on the site. Around 150 positions at the Calais plant would be made redundant as a result of the partial closure, according to French sources. The proposals will be negotiated in full consultation with employees and appropriate representative groups, the company says. ‘With the recent deterioration in industry conditions we have reviewed our manufacturing network in terms of cost and potential. We are confident that by rationalizing our capacity we can continue to meet our customer’s needs and improve our competitiveness as we create a market-leading Pigments and Additives business’, comments Huntsman’s president and CEO Peter R. Huntsman. The planned capacity reduction and attendant redundancies in Calais are in addition to the workforce reduction programme that Huntsman announced in December [ADPO, February 2015]. Cost savings from the former plan, which will cut around 900 jobs, are expected to be approximately $130 million/year and will be achieved by mid-2016. Huntsman’s Pigments and Additives segment achieved sales of $1.55 billion in 2014, up 22% from $1.27 billion in 2013. In the fourth quarter, the segment’s revenues were up 94% compared to 4Q 2013, to $573 million. These increases were primarily due to the Rockwood acquisition in October [ibid., December 2014]. Adjusted EBITDA for the segment fell in both periods. Pro forma for the Rockwood acquisition, revenues in the Pigments and Additives division decreased 12% year on year to $559 million for the three months ended 31 December 2014, due to lower sales volumes and lower average selling prices, Huntsman reports. Sales volumes decreased primarily as a result of lower end-use demand in Europe, the segment’s largest market. Average selling prices decreased as a result of high TiO2 industry inventory levels and the impact of a stronger US dollar against major European currencies. The segment’s pro forma adjusted EBITDA also decreased to $9 million in the fourth quarter of 2014, down 73% from $33 million in the same period of 2013. This was due to lower contribution margins for TiO2, whereas the combined adjusted EBITDA for additives was essentially flat, Huntsman says. Contact: Huntsman Corp, The Woodlands, TX, USA. Tel: +1 281 719 6000, Web: www.huntsman.com
Additives for Polymers
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benefit from backward integration into the site, allowing high delivery reliability and maximizing efficient use of energy and feedstock, the partners say. 2-EH acid is a chemical intermediate used in numerous applications, including the production of plasticizers, stabilizers and catalysts. ‘With this new plant, we are responding to our customers’ growing demands in Asia Pacific. Through this additional capacity BASF will become one of the leading suppliers for high purity 2-EH acid in the region’, says Stefan Blank, president of BASF’s intermediates division. BASF already operates a 2-EH acid production unit at its Ludwigshafen site in Germany. BASF, which is celebrating its 150th anniversary this year, had sales of E74.3 billion in 2014, up 0.5% from almost E74 billion the previous year. Sales volumes rose 4% but prices overall decreased by 3% and negative currency effects ‘dampened sales’ in almost all divisions, the company says. EBIT before special items rose 4% year on year to E7.4 billion in 2014, primarily due to a larger contribution from the chemicals business, comprising the chemicals, performance products, and functional materials & solutions segments, BASF reports. Net income amounted to E5.2 billion last year, exceeding 2013’s level of E4.8 billion. The group employed around 113 000 staff as of the end of the year. In 4Q 2014, BASF’s sales dipped 0.6% to E18.0 billion but sales volumes increased by 1% and EBIT before special items rose 2.8% to E1.5 billion. Net income for the quarter rose 25.7% to E1.42 billion from E1.13 billion in 4Q 2013. Contact: BASF SE, Ludwigshafen, Germany. Tel: +49 621 60 0, Web: www.basf.com Or contact: BASF Petronas Chemicals Sdn Bhd, Kuantan, Pahang, Malaysia. Tel: +609 585 5000, Web: www.basf-petronas.com.my
Huntsman plans to reduce its European TiO2 capacity by 13%
H
untsman Corp, one of the world’s largest producers of titanium dioxide (TiO2) pigments, is planning to reduce its European TiO2 capacity by approximately 100 000 tonnes/year, representing 13% of its TiO2 capacity on the continent. According to the company, the plan will generate approximately US$35 million in annual savings. Having considered different options, Huntsman is proposing to close specific operations at its Calais site in France. The
April 2015
plan is to discontinue the so-called ‘black end’ manufacturing operations – responsible for the start of the TiO2 production process – and ancillary activities at the site during 2015. The ‘white end’, which is used to finish and pack TiO2, would remain operational, employing up to 100 people on the site. Around 150 positions at the Calais plant would be made redundant as a result of the partial closure, according to French sources. The proposals will be negotiated in full consultation with employees and appropriate representative groups, the company says. ‘With the recent deterioration in industry conditions we have reviewed our manufacturing network in terms of cost and potential. We are confident that by rationalizing our capacity we can continue to meet our customer’s needs and improve our competitiveness as we create a market-leading Pigments and Additives business’, comments Huntsman’s president and CEO Peter R. Huntsman. The planned capacity reduction and attendant redundancies in Calais are in addition to the workforce reduction programme that Huntsman announced in December [ADPO, February 2015]. Cost savings from the former plan, which will cut around 900 jobs, are expected to be approximately $130 million/year and will be achieved by mid-2016. Huntsman’s Pigments and Additives segment achieved sales of $1.55 billion in 2014, up 22% from $1.27 billion in 2013. In the fourth quarter, the segment’s revenues were up 94% compared to 4Q 2013, to $573 million. These increases were primarily due to the Rockwood acquisition in October [ibid., December 2014]. Adjusted EBITDA for the segment fell in both periods. Pro forma for the Rockwood acquisition, revenues in the Pigments and Additives division decreased 12% year on year to $559 million for the three months ended 31 December 2014, due to lower sales volumes and lower average selling prices, Huntsman reports. Sales volumes decreased primarily as a result of lower end-use demand in Europe, the segment’s largest market. Average selling prices decreased as a result of high TiO2 industry inventory levels and the impact of a stronger US dollar against major European currencies. The segment’s pro forma adjusted EBITDA also decreased to $9 million in the fourth quarter of 2014, down 73% from $33 million in the same period of 2013. This was due to lower contribution margins for TiO2, whereas the combined adjusted EBITDA for additives was essentially flat, Huntsman says. Contact: Huntsman Corp, The Woodlands, TX, USA. Tel: +1 281 719 6000, Web: www.huntsman.com
Additives for Polymers
7