Aug 23 2005
Borealis has announced solid financial results for the second quarter, posting a net profit of EUR 51 million. This result constitutes a 50% increase on the EUR 34 million achieved in the same quarter last year. Lower industry margins reduced net profit by EUR 33 million compared to the first quarter of 2005.
The second quarter was characterised by rising oil and feedstock prices combined with low demand and sharply dropping polyolefin prices in Europe.
Commenting on the result, Chief Executive John Taylor said:
“Despite the tough business climate in Europe we continue to deliver solid results, a testimony to our successful transformation over the past four years, and confirmation that our value creation strategy targeting key market segments remains the right one. The continued implementation of our strategy based on innovation, in conjunction with our recent expansion in the Middle East, will be further underpinned by the foreseen change in our ownership structure.”
Borealis recently announced a change in its shareholding structure when the International Petroleum Investment Company (IPIC) of Abu Dhabi and OMV AG of Austria announced their agreement to purchase Statoil’s 50% shareholding in Borealis A/S.
As a result, the new Borealis ownership will be 65% IPIC and 35% OMV, with a closing of the transaction expected during the fourth quarter, subject to regulatory approvals being received.
Borouge, Borealis’ joint venture with the Abu Dhabi National Oil Company, continued to improve its performance following the first quarter expansion of its Borstar® polyethylene (PE) capacity from 450,000 to 600,000 tonnes per year.
With its successful track record and in response to growing market needs in the Middle East and Asia, Borouge progressed a proposed major expansion in Abu Dhabi by awarding the Project Management and Financial Advisor contracts to Foster Wheeler and HSBC respectively. This expansion will more than triple current polyolefin production capacity in Ruwais, Abu Dhabi to 2 million tonnes per year.
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