23 January 2009 16:41 [Source: ICIS news]
LONDON (ICIS news)--Fitch Ratings has given a negative outlook to chemical companies in the EMEA (Europe, Middle East and Africa) region as production cutbacks in end-user markets painted a bleak demand picture in 2009, the credit watchdog said on Friday.
Fitch forecast year-on-year volume contraction on petrochemicals, polymers and plastics in line with key end-market demand and with the trends observed in the fourth quarter.
“Against depressed demand and this uncertain economic backdrop, volatility in feedstock costs and foreign exchange will present additional challenges for EMEA chemical producers,” said a Fitch statement.
Producers were expected to intensify their focus on cash preservation with priority given to cost-cutting programmes, selective capex spending and reduced shareholder distributions.
Fitch said these measures were unlikely to absorb the impact of the downturn and forecasted deterioration of in margins, operating profits and cash flow across the sector.
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|