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Resins & Coatings

News Review


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AKZO reports positive developments in Q2

Akzo Nobel N.V. reported a second quarter with positive developments in profitability of all three business areas, despite a challenging market environment.
Second quarter operating income increased 38% to EUR 486 million, reflecting the positive effects of efficiency programs, lower costs, reduced restructuring expenses, divestment results and favorable currency rates. Revenue of EUR 3,949 million was up 6%, compared with the same period last year due to favorable currency rates, offset by divestments and lower volumes in some areas.
The divestment of Paper Chemicals was completed in line with the strategy of pruning the portfolio. Market trends in North America continued to be positive but Europe not improving. Conditions remained challenging in many countries, including Russia, Brazil and China. Return on sales improved to 12.3% and return on investments was up at 11.7%.
Decorative Paints achieved a solid growth in profitability, with operating income increased by 25% and revenue up 6%. Operating income showed improvement with an increase, due to the new operating model, lower costs, reduced restructuring expenses, strict cost containment and favorable currency developments. Revenue was up mainly driven by favorable currency effects. Volumes for the second quarter were up in Asia, while volumes were down for Europe and Latin America.
Performance Coatings benefited from cost reductions created through performance improvement initiatives, margin management activities, manufacturing productivity and favorable currencies, which resulted in an increase of operating income of 24%. Revenue was up 8% across all reporting units, benefiting from favorable currencies and a higher demand for premium products. Volumes declined mainly due to lower capital and maintenance spending in the global oil and gas industry.
CEO Ton Buechner commented: "We continue to deliver on our aim to improve the performance of our company. This will position us well to make the most of future opportunities and growth. The second quarter continued to show the positive impact of our focus on profitability and leadership in sustainability. The global economy remains challenging and shows a very mixed picture with different dynamics per region and customer segments. We remain on track to deliver our 2015 targets."

BAYER significantly improves earnings

The Bayer Group continued to grow sales in the second quarter of 2015 and significantly increased earnings. Sales of the Bayer Group moved ahead in the second quarter of 2015 by 18.2% to EUR 12,090 million (Q2 2014: EUR 10,228 million).
"All three subgroups contributed to the gratifying improvement in earnings", said Bayer CEO Dr. Marijn Dekkers when the interim report was published.
At MaterialScience, sales were level with the prior-year quarter. Earnings of this subgroup, however, posted a sharp improvement of almost 90%, mainly as a result of the improved demand situation and lower raw material costs.
The preparations for the planned stock market flotation of MaterialScience are on schedule. Dekkers expressed his continued optimism for the year as a whole: "We are confirming our Group forecast for the operational performance of continuing operations".
Sales of the high-tech polymers business rose by 11.2% in the second quarter to EUR 3,185 million (Q2 2014: EUR 2,864 million). After adjusting for currency and portfolio effects, sales were flat with the prior-year quarter (plus 0.6%). "Volumes at MaterialScience expanded in all regions. On the other hand, there were negative price effects, particularly for Polyurethanes", Dekkers explained. Raw material prices were down steeply overall against the prior-year period. Sales of the Polyurethanes unit (foam raw materials) fell by 2.9%. Volume increases did not fully offset the sharp decline in selling prices.
Sales in the Coatings, Adhesives, Specialties business unit moved forward by 6.0% as a result of higher volumes. Selling prices as a whole were somewhat below the level of the prior-year period.

HEXION restarts VeoVa esters production

Hexion Inc. has successfully restarted production of VeoVa vinyl ester products at its manufacturing facility at Moerdijk, Netherlands, which produces a variety of Versatic acid derivatives. As a result, Hexion has lifted its Force Majeure notice for VeoVa vinyl ester products declared in October 2014, due to a supplier outage.
"We are pleased to resume normal production and our highest priority remains reliable operations in support of our customer requirements", said Egbert Klaassen, global marketing director, Versatic Acids and Derivatives. "During the Force Majeure, we worked hard to minimize any customer impact by leveraging other global production sites, such as a joint venture facility in Shanxi, China and a smaller VeoVa vinyl ester production unit in Moerdijk. We were able to efficiently optimize our global manufacturing network due to our 50 years of Versatic Acids and Derivatives production experience. The additional manufacturing capabilities that were put in place during the Force Majeure will improve our operational flexibility going forward and we are now focused on fully restocking our global supply chain".
(Coatings World)

BASF exits dimer and polyamide resins business

BASF announced plans to exit the dimer and polyamide resin business due to the North American market decline over the past 15 years, driven by excess market capacity and a decline in key markets including printing. The decision will result in the closure of the dimer and resin production unit at BASF's Kankakee, Illinois, location.
"This decision has been difficult because it impacts employees in Kankakee and our dimer and polyamide customers", said Gerry Podesta, Senior Vice President for Dispersions and Pigments in North America. "We will take steps to ensure a smooth transition for customers and provide support to employees during this time".
BASF will continue to operate the Kankakee site which supplies customers with products for the Nutrition and Health and Care Chemicals Divisions of the company.
BASF's Dispersions & Pigments Division in North America offers a comprehensive portfolio of resins, binders, latex, pigments and effect pigments, colorants, and systems to meet specific application needs for the coatings, construction, printing and packaging, plastics and paper markets. Our innovative products also help manufacturers in the adhesives, nonwovens and fiber bonding industries meet functional and performance demands. Key product areas of formulation additives, rheology modifiers, light stabilizers, photoinitiators, and antioxidants significantly enhance the BASF product portfolio for these markets.

SIKA reports growth in all regions

Significant volume increases and gains in market share were achieved for SIKA in all regions during 2015 first half, despite a very strong prior-year period (sales growth of 18.1%). At constant exchange rates, sales rose by 5.6% to CHF 2.625 billion.
The strength of the Swiss franc was more than compensated by volume growth, ongoing efficiency improvements and lower commodity prices which lead to margins increasing by an above-average amount. Operating profit rose by 8.3% to CHF 288.6 million (previous year: CHF 266.4 million) while net profit increased by 11.1% to CHF 197.3 million (previous year: CHF 177.6 million).
Sika CEO Jan Jenisch said: "Once again, the successful first half shows that the rigorous implementation of our growth model is delivering outstanding results. Despite the challenging environment, our 17,000 employees have demonstrated their competence and commitment and achieved a record result. An increase in net profit of 11.1% is a very convincing result, given the appreciation of the Swiss franc. Double-digit sales growth in the core markets of the USA, Latin America, Africa, the Middle East, Eastern Europe, Southeast Asia and the Pacific underlines the strength of our growth model and allows us to face the future and the second half of 2015 with confidence".
In the region EMEA (Europe, Middle East, Africa), sales grew by 3.8% in the first half of 2015. Growth accelerated in the second quarter thanks to good performance in Eastern Europe, Africa and the Middle East. Sales in Western Europe did not quite match the extremely strong prior-year result. The expansion of production capacity resulting from the opening of new factories in Dubai and La RĂ©union will generate additional growth momentum in the region in the future.
Despite the negative market trends in China, accelerated expansion in the emerging markets continued to generate strong results, with sales up by 8.7%. The high-margin mortar business - a core component of Sika's Strategy 2018 - put in an above-average performance, with sales growth of 12.4%. Sika has further expanded its fast-growing mortar business in recent months by making three acquisitions - BMI in the USA, CTA in Australia and Duro-Moza in Mozambique.
The accelerated development of the growth markets will continue. It is planned to open between seven and nine factories in 2015. In line with Strategy 2018, Sika expects sales growth of 6-8% at constant exchange rates. Margins for the year as a whole are expected to rise at above-average rates, thanks to continued volume growth, efficiency improvements and lower commodity prices.
(Coatings World)

SHERWIN-WILLIAMS reports strong results

The Sherwin-Williams Company announced its financial results for the second quarter and first half of 2015. Compared to the same periods in 2014, consolidated net sales increased USD 89.1 million, or 2.9%, to USD 3.13 billion in the quarter and increased USD 172.9 million, or 3.2%, to USD 5.58 billion in six months, due primarily to higher paint sales volume in Paint Stores and Consumer Groups.
Net sales in the Paint Stores Group increased 5.4% to USD 1.98 billion in the quarter and increased 6.3% to USD 3.45 billion in six months, due primarily to higher architectural paint sales volume across all end market segments. Net sales from stores open for more than twelve calendar months increased 3.9% in the quarter and increased 5.0% in six months over last year's comparable periods.
The Global Finishes Group's net sales 7.1% to USD 505.8 million in the quarter and decreased 6.4% to USD 975.3 million in six months. Unfavorable currency translation rate changes decreased net sales by 7.7% in the quarter and 7.3% in six months.
Commenting on the financial results, Christopher M. Connor, chairman and chief executive officer, said, "Our Paint Stores Group posted another quarter of positive operating results and architectural volume growth across all end market segments. Consumer Group improved its operating results through improved operating efficiencies. Our Global Finishes and Latin America Coatings Groups are managing through the negative effects of currency devaluation and weak end market demand in some geographies. In total, it is gratifying to report another quarter of record sales and earnings per share. We continued to invest in our business by opening twenty-two net new locations in the Paint Stores Group in the first six months. For the third quarter, we anticipate our consolidated net sales will increase 3-5%, compared to last year's Q3".
(Coatings World)

DUPONT officially spins off CHEMOURS

As of July 1, the new company of Chemours Co. officially spun off from DuPont.
The company is divided into three business units: Titanium Technologies, Fluoroproducts and Chemical Solutions. The Teflon product line falls under Fluoroproducts. With the transition, Chemours brings the Teflon product line and the power of the Teflon brand name with it. The transition will allow the new company to focus on customers and brings an agility to produce new products and be more responsive.
On June 29, 2015, the company marked its spin-off from DuPont by ringing the opening bell of the New York Stock Exchange.
"As The Chemours Company, we will enjoy leading market positions in titanium technologies, fluoroproducts and chemical solutions, positions propelled and sustained by our commitment to technology leadership, safer and more efficient processes, leading application development, and world-class products and enabling ingredients. We will be a nimble and responsive corporation that will define our success by our customers' successes, as well as the value we bring to our shareholders", said Mark Vergnano, Chief Executive Officer of Chemours.

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News are listed from various sources, as quoted above, aggregated by agents ANDRIANOS Chemicals, Athens, Greece.