The blog’s quarterly review of company results shows a considerable shift in mood since May.
Then, many analysts were completely fooled by the short-term support provided to margins by higher oil prices. And only Peter Huntsman warned about the risks of high oil prices, unemployment and economic fragility.
Q2 results show many more companies adopting his more defensive position.
The largest of them all, BASF, suffered a 5% fall in its share price as a result. The analysts who follow it had clearly believed their own propaganda. Oil prices at today’s levels have always led to a global recession, and the risk of believing that ‘this time is different’ is rising all the time.
Most worrying was the change in tone from AkzoNobel. 3 months ago, they were still optimistic about the outlook. This time, CEO Hans Wijers warned about the risk of some “scenarios which are of course very scary”. Wijers is a former economics minister in the Dutch government, and does not exaggerate.
Air Products. “See strong volume growth across a number of our businesses”.
Akzo. “A very volatile world, with very little visibility, and there are scenarios which are of course very scary.”
Arkema. “Repositioning in buoyant markets and the contribution of growth projects”.
Ashland. “Significantly affected by steep raw-material cost increases”.
BP. “Volumes were lower by about 8%, driven primarily by shutdowns”.
BASF. “The economic risks remain”.
Bayer. “Increase in raw material and energy costs was more than offset by higher selling prices”.
Celanese. “We aggressively mitigated the impact of higher raw material and energy costs”.
Clariant. “A more difficult but nevertheless solid business environment, characterised by softening demand”.
ConocoPhillips. “Higher margins in olefins and polyolefins, and higher volumes”.
Cytec. “Uncertain pace of global economic recovery, persistent high unemployment, fiscal constraints in the developed economies and inflationary concerns in the emerging markets”.
Dow. “Our transformed portfolio, underpinned by our cost-advantaged and flexible operations, is now performing at a new level.”
Dow Corning. “Uncertainty in the current business environment”.
DSM. “Very solid results in materials sciences due to pricing strength and volume growth”.
DuPont. “Compelling growth opportunities stemming from science-powered innovations and collaboration”.
Eastman. “Higher raw material and energy costs, as well as strengthened demand”.
ExxonMobil. “Improved margins…offset by lower volume sales”.
Huntsman. “Given the sluggish global economic recovery, very pleased with the improving results”.
INEOS. “Cracker margins have been at top of cycle levels”, with chemicals EBITDA at a record €1923m for the past 12 months.
LyondellBasell. “Margins increased over already strong first-quarter levels”.
Marubeni. “Rising prices of petrochemical products and increased volume”.
Methanex. “Outlook is excellent.”
Olin. “Bracing for softer demand in the third quarter because of anticipated chlorine customer outages and weakened vinyls exports”.
Orlen. “Lower sales on the Czech market were partially offset by the increase in the Polish market”.
Oxychem. “Strong export demand and higher margins.”
Polimeri Europa. “High feedstock costs and lower demand”.
PPG. “Anticipate the global economic recovery will continue, although at its uneven pace”.
Praxair. “Strong growth in Asia and South America and moderate growth in North America.”
Reliance. “Sales increase driven by higher volumes and higher prices”.
Rhodia. “Solid levels of demand as well as excellent pricing power.”
SABIC. “What keeps me awake at night is keeping the successes we have. This is about the 8.1 billion riyals … How long can we sustain this? It is challenging.”
Sherwin-Williams. “Domestic demand remains soft”.
Shin-Etsu. “Domestic PVC sales suffered becuase of the temporary shutdown in quake-hit Kashima, while profits in the US improved”.
Siam Cement. “HDPE-naphtha margin declined $60/t QonQ to its lowest since 2002”.
Solvay. “Margins in plastics are currently above pre-crisis levels”.
Syngenta. “Sales showed sustained volume momentum in all regions”.
TOTAL “A generally favourable environment”.