Chemical industry weekly news roundup, 15 November
2:02 PM MST | November 15, 2013 | By LINDSAY FROST
This Week in CW:
A few more companies reported earnings this week as the season comes to an end. K+S’ third-quarter revenues were down 11%, to €817.7 million, with potash and magnesium products declining 18.5%, to €456.7 million. Merck KGaA reported a much improved third-quarter net income and organic sales in a challenging market environment and raised its Ebitda guidance for the full-year. Net income, at €340 million ($458.1 million), was nearly double the €185 million achieved in the year earlier quarter. Israel Chemicals (ICL; Tel Aviv) announced a sharp decrease in third-quarter sales and profits citing weakness and instability in the potash market, which led to lower fertilizer volumes and prices. Net income was $78 million compared with $395 million in the year-earlier period. Rockwood has reported third-quarter adjusted net income of $48.2 million, or 63 cts/share, down 31.5% year-on-year (YOY), on sales up 3.2%, to $890.1 million. Codexis (Redwood City, CA), a company that engineers enzymes for pharmaceutical, biofuel, and chemical production, reports a net loss of $9.26 million in the third quarter of 2013, compared with a net loss of $2.30 million in the year-ago quarter. Cereplast announced its results for the first nine months of 2013—reporting a net loss of $34 million, compared to a loss of $16.3 million in the same period of 2012, driven by an increase in other expenses related to financing transactions, the company says.
Odebrecht, the parent of Braskem, is exploring the possibility of building a petrochemical complex in West Virginia, the state’s governor announced in a press release on 14 November. The project, located in the Marcellus shale region of the Northeast United States, would include an ethane cracker, three polyethylene plants, and associated infrastructure for water treatment and energy co-generation. Odebrecht, a Brazilian engineering and construction firm, would operate the water and electric utilities associated with the complex, which the company calls the Appalachian Shale Cracker Enterprise, or Ascent. Braskem would run the petrochemical operations and market its products. The news comes within days of a report by a Brazilian newspaper, Valor Economico, that Braskem’s Comperj project has stalled amid concern that it would no longer be competitive, given the cost advantage granted North American producers by the shale gas revolution.
Sabic Innovative Plastics (Pittsfield, MA), a wholly owned subsidiary of Sabic, will be consolidating its acrylonitrile butadiene styrene (ABS) operations in the United States, closing its plant at Washington, WV, the company announced. Sabic will be transferring part of its ABS production to its plants in Ottawa, IL, and Bay St. Louis, MS, during the second quarter of 2015 "in an effort to increase its competitive positive in the challenging global ABS market," says Scott Dansey, plant manager at Sabic Innovative Plastics. The Washington ABS plant has a production capacity of some 90,000 m.t./year, while the site at Bay St. Louis has a capacity of 70,000 m.t./year, and the site at Ottawa a capacity of 150,000 m.t./year, all according to IHS Chemical data.
Around the Web:
Warren Buffett's Berkshire Hathaway Inc. on Thursday disclosed a new $3.45 billion stake in Exxon Mobil Corp., after buying 40.1 million shares in the world's largest publicly traded oil company, according to Reuters. Although the investment represents just 0.9% of Houston-based Exxon's shares, analysts said it reflects strong support by the second-richest American of one of the world's largest and most profitable companies. Exxon shares rose 84 cents, or 0.9 percent, to $94.06 in after-hours trading following Berkshire's disclosure of its stake.
Business Insider released an infographic depicting 14 warning signs that the stock market bubble will burst. The article says that earnings growth has been aided by record high profit margins, which don’t look sustainable.
Hydrogen generated using sunlight could replace fossil fuels for transportation and electricity generation, according to MIT Technology Review. By making a solar photovoltaic material more resilient, researchers may have found a way to make artificial photosynthesis—that is, using sunlight to make fuel—cheap enough to compete with fossil fuels. If you want hydrogen to power an engine or a fuel cell, it’s far cheaper to get it from natural gas than to make it by splitting water. Solar power, however, could compete with natural gas as a way to make hydrogen if the solar process were somewhere between 15-25% efficient, says the US Department of Energy (DOE).