This week’s company results have been keenly awaited, as the industry seeks to form a view on what happens next to demand and profits.
My new IeC colleague Paul Satchell reviews them, from the point of view of a highly-experienced financial analyst, in his ‘Chemicals Viewpoint’. But the blog thought it would also be interesting to simply quote the actual words used by companies themselves, as reported by ICIS news:
Akzo Nobel, “With the exception of some emerging markets, we see little significant recovery of growth,” CEO Hans Wijers.
BASF, “Capacity utilisation rose from below 60% in the first quarter to slightly above 60% in the second – there was no reason why the second half would show an improvement on the first, and could possibly be worse”, CFO Kurt Bock
Bayer, “The bottom of the cycle has been reached, but there is still no sign of a sustained recovery in demand,” CEO Werner Wenning.
BP Chemicals, “The outlook continues to be challenging”
Celanese, “We’re not seeing signs of a widespread strong recovery,” CEO David Weidman
Dow, “Second-quarter operating rate was c75%, with overall demand still below last year and excess capacity remaining”, CEO Andrew Liveris.
Dow Corning, “global economic recession continues to dampen demand”, CFO J Donald Sheets.
DuPont, “My concern is the true demand recovery. Are we going to be bumping along the bottom,” CEO Ellen Kullman
ExxonMobil Chemicals, “Q2 prime product chemical sales fell 6.7% versus 2008.”
Mitsubishi, “Ethylene production in the quarter fell 13% year on year”
Olin, “Precipitous decline in caustic soda pricing and the continuation of weak demand,” CEO Joseph Rupp
Reliance, “Attributed its rising margins to the fact the industry was operating on a low level of inventory, and the depreciation of rupee against the dollar”.
Rhodia, “Demand in emerging countries returned to 2008 levels and customer de-stocking in Europe and North America was essentially completed,” CEO Jean-Pierre Clamadieu.
Shell Chemicals, “Reduced global demand for chemical products significantly impacted the chemicals manufacturing plant utilisation rate, which dropped to 68% from 84% in Q2 2008”
Siam Cement, Thailand, “It remains to be seen what path the recovery process takes and over what period.”
Sherwin Williams, The “past three years have erased a decade of growth in the coatings market”, CEO Chris Connor.
Sinopec, “Mainstream ethylene plants were running at full capacity from January to June 2009. We haven’t seen signs of demand falls and will keep high production”.
Wacker, “Customers are still cautious about placing orders. They are ordering smaller quantities or concluding contracts with shorter durations”.
Sinopec is clearly still benefiting from the Chinese “bubble“. But demand elsewhere shows no sign of returning to pre-2008 levels.
The blog was also interested to see Akzo Nobel’s CEO Hans Wijers adopting one of its own mottoes for the crisis, that “We hope for the best, but we prepare for the worst.”