US Momentive warns on volatile raw materials, cites phenol spikes
Stefan Baumgarten
13-Aug-2014
HOUSTON
(ICIS)–Momentive Specialty Chemicals’ raw material price
environment remains volatile, especially for phenol, the CEO
of the US-based firm warned on Wednesday.
“I should caution that raw material [prices] remain volatile,
for instance we saw phenol spikes of 12%
in the US and 10%
in Europe in July,” Craig Morrison told analysts
during Momentive’s
second-quarter results conference call.
“We continue to remain vigilant on the pricing front to
effectively manage the raw materials volatility,” he
added.
As for the second quarter ended 30 June, Momentive saw a
modest decline in raw material prices from the first
quarter.
Year-over-year, second-quarter raw material prices were
mixed, with phenol down 1% and urea down 3% while methanol
rose 16%.
Momentive
has two core businesses: epoxy, phenolic and coating resins,
and forestry products resins.
Epoxy, phenolic and coating resins’ second-quarter earnings
before interest, tax, depreciation and taxation (EBITDA) fell
1% year over year to $72m, with EBITDA margins falling to
8.5%, from 9.1% in the 2013 second quarter. The segment’s
sales rose 8% to $862m, with sales up in all product
lines except epoxy resins.
Forestry products resins’ second-quarter EBITDA rose 10% to
$65m, with EBITDA margins rising to 13.7%, from 13.1% in the
2013 second quarters. The segment’s sales rose 5% to $475m on
strong North American formaldehyde demand.
Additional reporting by Jonathan Lopez.
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