- Sales up 2.0% year on year to €2,215 million. Increased selling prices (+4.7% in the High Performance Materials division)
- EBITDA at €370 million, close to the record performance of first-quarter 2018 (€383 million), in a volatile and mixed economic environment
- EBITDA growth for specialties (71% of Group sales) despite the decline of certain end-markets (automotive, electronics)
- Lower performance, as expected, for intermediates (1) (29% of Group sales) compared with last year’s record high comparison base
- Very solid EBITDA margin at 16.7%
- Adjusted net income at €165 million, representing 7.4% of sales
- Strong cash generation for a first quarter, with free cash flow increasing to €73 million (€25 million outflow in first-quarter 2018)
- Net debt under tight control at €1,130 million (including a €159 million increase related to the first-time application of IFRS 16), representing 0.8 times the EBITDA of the last 12 months.
(1) The intermediate chemicals businesses comprise the Acrylics, PMMA and Fluorogases Business Lines.
Arkema’s Board of Directors met on 6 May 2019 to review the Group’s consolidated financial statements for the first quarter of 2019. At the close of the meeting, Chairman and CEO Thierry Le Hénaff stated:
“The Group’s first-quarter financial performance, close to its record-high levels, was in line with the guidance issued at the beginning of the year and demonstrates the Group’s good resilience in a global economic environment that was less favorable compared with the first quarter of 2018.
Several points deserve to be highlighted. This solid start to the year was supported by the increased results delivered by Bostik, which is reaping the benefits of its efforts to enhance product mix and raise selling prices in the face of persistently high raw materials costs, as well as its ongoing initiatives to improve its competitiveness. At the same time, the acrylics business confirmed its gradual improvement, and the specialty businesses reported an increase in their overall results, despite a significant decline in volumes in the automotive, electronics and oil & gas markets. Unsurprisingly, earnings for PMMA and fluorogases came in lower than the exceptional levels achieved in the prior year.
Our transformation strategy towards specialty chemicals therefore continues to bear fruit and, beyond the short-term, Arkema will continue to pursue its reflections and projects in order to further increase the share of specialties within its business portfolio.”
Outlook for 2019
In continuity with the start of the year, the macroeconomic environment should remain volatile, marked by geopolitical uncertainties which are weighing on global demand. In this context, Arkema will maintain its focus on internal momentum and the implementation of its long-term strategy.
The Group will continue the roll-out of its industrial projects to reinforce its positions in specialty businesses and higher-growth regions, its innovation drive for sustainable development, its targeted acquisition policy, its operational excellence initiatives and its policy of selectively raising selling prices in a context of high oil prices.
Over the course of the year, while remaining attentive to the development of the macroeconomic environment, Arkema confirms its ambition to consolidate its financial performance at high levels and to achieve in 2019(1) an EBITDA comparable with the 2018 record level. Following a second quarter performance which should remain below last year in a macroeconomic environment in continuity with the start of the year, the Group expects in the second half of the year to benefit from improved market dynamics in specialties, continued recovery in unit margins in downstream businesses, and the start-up of new capacities.
Further details of the Group’s first-quarter 2019 results and outlook are provided in the “First-quarter 2019 results” presentation available on Arkema’s website at www.finance.arkema.com.
(1) 2019 takes into account the new IFRS 16 standard.
