Indorama merges value-added assets

INDUSTRY: Indorama Ventures Pcl (IVL), a global chemical producer, has reported strong first-quarter results.

The quarterly performance benefited from expanded margins because of successful integration of high value-added products and other assets acquired in 2016, as well as normalised production from IVL’s ethylene oxide/ethylene glycol facility in the US.

On a year-on-year basis, production was up 24% and sales revenue gained 25%. In the first quarter, core ebitda (earnings before interest, tax, depreciation and amortisation) grew by 60% to 7.68 billion baht, said Aloke Lohia, group chief executive.

In the last 12 months from March 31, IVL’s existing businesses, excluding acquisitions in 2016, delivered improved results from better capacity utilisation and operational excellence projects to reduce cost.

The company reported volume growth in all geographic areas.

Overall operating rate remained at 86% over the previous 12 months in the quarter, enabling margin expansion and better asset utilisation.

Core ebitda for the last 12 months was 30 billion baht, a 37% rise year-onyear, and return on capital employed improved to 12%.

IVL is committed to investing about US$1.2 billion on identified growth and maintenance-related projects over the next two years.

During the same period, the company sees financial headroom for further investments based on its projections of internal cash accruals and prudent borrowing capacity.

Operating cash flows rose from 4.97 billion baht in the first quarter of 2016 to 7.73 billion in the same quarter this year.

“We look forward to another year of disciplined growth,” Mr Lohia said.

IVL shares closed yesterday on the Stock Exchange of Thailand at 36 baht, down 25 satang, in heavy trade worth 1.17 billion baht.