Company News
June 25, 2020
Dow Q2 Struggles
Dow CFO sees additional $350M headwind to Q2 EBITDA
Jun. 24, 2020 6:57 PM ET|About: Dow Inc. (DOW)|By: Carl Surran, SA News Editor
Dow Inc. (DOW -7%) was today’s biggest loser on the Dow Jones index after President and CFO Howard Ungerleider said he expects “an additional $350M headwind” to total EBITDA in Q2 compared with current market expectations, primarily due to a delayed and slower recovery in the automotive, construction, appliance and furniture sectors.
In remarks today at the BMO Chemicals & Packaging Conference, Ungerleider said Dow saw gradual incremental gains in May from April to May with expectations for further revenue improvement in June, but the composition of sales by segment is a bit different than expected, driven by lower spending in consumer durables and big-ticket items.
The “sluggish Q2 recovery in durable consumer items has significantly impacted our Industrial Intermediates and Infrastructure operating segment… with polyurethanes having the greatest exposure to these end-markets. Going into Q2, we expected demand declines in our polyurethanes applications in the 15%-20% range.. but now believe it will be closer to the 25%-30% range,” the CFO said.
On a more upbeat note, Ungerleider found it “encouraging to see the pace of recovery beginning to accelerate in June in almost every value chain in our portfolio… Our order books and shipments for this month show that volume expectations continue to improve across all of our businesses.”
June 22, 2020
Huntsman Updates Guidance
June 22, 2020Huntsman Updates its Second Quarter Outlook; To Discuss Second Quarter 2020Results on July 28, 2020THE WOODLANDS, Texas, June 22, 2020 /PRNewswire/ —
Huntsman Corporation (NYSE:HUN) today reaffirmed its overall general outlook for the second quarter 2020 and announced that overall sales for the quarter are expected to be down between approximately 30 to 35 percent versus last year. Huntsman noted that the sales trendsshowed improvement from April to May, and it expects to see this continued improvement through June.
Results in its Polyurethanes division are expected to be modestly better than expected as trends in China and in U.S. construction, including spray foam, are better than originally anticipated.
The better-than-expected results in Polyurethanes are being mostly offset by weaker-than-anticipated results in Huntsman’s Textiles Effects division due largely to the prolonged impact of mandated shutdowns in key textile manufacturing regions, and the expected recovery in the industry may not begin until the third quarter due to the continued lockdowns. Huntsman anticipates that adjusted EBITDA in its Textiles Effects division will likely be slightly negative for the second quarter. Huntsman expects that results in the Performance Products division will be in-line with the prior outlook, but the results in the Advanced Materials division may fall a little short of expectations as a result of a deeper trough in Aerospace, Europe, and India than anticipated at the time of its last quarterly earnings call.
Huntsman Corporation will hold a conference call on Tuesday, July 28, 2020, at 10:00 a.m.ET to discuss its second quarter 2020 financial results, which will be released at approximately 6:00 a.m. ET that day.
June 22, 2020
Huntsman Updates Guidance
June 22, 2020Huntsman Updates its Second Quarter Outlook; To Discuss Second Quarter 2020Results on July 28, 2020THE WOODLANDS, Texas, June 22, 2020 /PRNewswire/ —
Huntsman Corporation (NYSE:HUN) today reaffirmed its overall general outlook for the second quarter 2020 and announced that overall sales for the quarter are expected to be down between approximately 30 to 35 percent versus last year. Huntsman noted that the sales trendsshowed improvement from April to May, and it expects to see this continued improvement through June.
Results in its Polyurethanes division are expected to be modestly better than expected as trends in China and in U.S. construction, including spray foam, are better than originally anticipated.
The better-than-expected results in Polyurethanes are being mostly offset by weaker-than-anticipated results in Huntsman’s Textiles Effects division due largely to the prolonged impact of mandated shutdowns in key textile manufacturing regions, and the expected recovery in the industry may not begin until the third quarter due to the continued lockdowns. Huntsman anticipates that adjusted EBITDA in its Textiles Effects division will likely be slightly negative for the second quarter. Huntsman expects that results in the Performance Products division will be in-line with the prior outlook, but the results in the Advanced Materials division may fall a little short of expectations as a result of a deeper trough in Aerospace, Europe, and India than anticipated at the time of its last quarterly earnings call.
Huntsman Corporation will hold a conference call on Tuesday, July 28, 2020, at 10:00 a.m.ET to discuss its second quarter 2020 financial results, which will be released at approximately 6:00 a.m. ET that day.
June 22, 2020
Divestments Ahead
Total to Solvay Pursue Chemical Divestments as M&A Returns
Myriam Balezou, Andrew Noël and Dinesh Nair, Bloomberg News
A logo sits on the exterior of the Total SA skyscraper headquarters in the La Defense business district in Paris, France, on Wednesday, Jan. 22, 2020. French Finance Minister Bruno Le Maire said he’s hopeful for a compromise with the U.S. on digital tax to avoid a transatlantic trade war. Photographer: Anita Pouchard Serra/Bloomberg , Bloomberg
(Bloomberg) — European companies from Total SA to Solvay SA are pursuing divestments of chemical businesses, in one of the first tentative signs that mergers and acquisitions are starting to return in the region.
Total is considering a sale of its Cray Valley chemical-additives unit, which could fetch about $300 million to $500 million, according to people with knowledge of the matter. The French energy company has been speaking with potential advisers about a divestment, the people said, asking not to be identified because the information is private.
Arkema SA has separately started gauging interest in its plexiglass business, which could fetch about 1 billion euros ($1.1 billion) for the French chemical producer, people familiar with the matter said. The company has sent potential bidders so-called teaser documents with an overview of the Altuglas International division, according to the people.
Companies have been seeking to offload peripheral businesses in a bid to boost returns and fend off criticism from activist investors. Carveouts by European companies hit a record last year and could rise further in 2020 as firms seek to weather the after-effects of the coronavirus pandemic, a top Credit Suisse Group AG dealmaker said last week.
Streamlining Operations
Some chemical producers have been able to ride through the crisis relatively unscathed, particularly those making products like cleaning solvents and protective sheets which are seeing increased sales. A gauge of European chemical companies has risen 1.8% over the past 12 months, bucking the 5.4% decline in the Stoxx Europe 600 Index.
Solvay SA is also exploring a sale of two units as Chief Executive Officer Ilham Kadri pushes ahead with efforts to streamline the Belgian chemical maker, people with knowledge of the matter said. The potential divestments include a unit that works with the compound strontium carbonate, which could fetch around 150 million euros, and another making chemicals used in shampoo and dishwashing products, the people said.
The volume of dealmaking globally has fallen 47% this year to $991 billion, according to data compiled by Bloomberg. Some shelved deal processes have been revived in recent weeks, with Bridgepoint preparing to restart a bidding process for Iberian agrochemical business Rovensa, Bloomberg News reported this month.
Sasol Sale
Arkema’s Altuglas sale is attracting initial interest from private equity firms including Advent International, Rhone, SK Capital Partners and Triton Partners, the people said. The business produces polymethyl methacrylate-based plastics, which are used in car parts like headlights as well as building materials. Colombes, France-based Arkema hasn’t decided when to seek first-round bids and could wait until after summer to formally solicit offers, one of the people said.
Beyond Europe, Sasol Ltd. is attracting interest in a large stake it’s selling in the Lake Charles chemical complex in the U.S. The South African company has received offers from Ineos Group Ltd., Chevron Phillips Chemical Co. and LyondellBasell Industries NV for the holding, which could fetch more than $2 billion, people familiar with the matter said earlier this month.
All the companies’ deliberations are at an early stage, and there’s no certainty the suitors will submit bids, the people said.
Representatives for Total, Arkema, Advent, Rhone, SK and Triton declined to comment. A spokesman for Solvay said the chemical group has a clear plan to unlock value and regularly receives approaches, particularly after last year’s strategy update. He declined to comment further. A spokesman for Sasol said the firm’s asset disposal process had yielded “good interest from strong contenders.”
June 22, 2020
Divestments Ahead
Total to Solvay Pursue Chemical Divestments as M&A Returns
Myriam Balezou, Andrew Noël and Dinesh Nair, Bloomberg News
A logo sits on the exterior of the Total SA skyscraper headquarters in the La Defense business district in Paris, France, on Wednesday, Jan. 22, 2020. French Finance Minister Bruno Le Maire said he’s hopeful for a compromise with the U.S. on digital tax to avoid a transatlantic trade war. Photographer: Anita Pouchard Serra/Bloomberg , Bloomberg
(Bloomberg) — European companies from Total SA to Solvay SA are pursuing divestments of chemical businesses, in one of the first tentative signs that mergers and acquisitions are starting to return in the region.
Total is considering a sale of its Cray Valley chemical-additives unit, which could fetch about $300 million to $500 million, according to people with knowledge of the matter. The French energy company has been speaking with potential advisers about a divestment, the people said, asking not to be identified because the information is private.
Arkema SA has separately started gauging interest in its plexiglass business, which could fetch about 1 billion euros ($1.1 billion) for the French chemical producer, people familiar with the matter said. The company has sent potential bidders so-called teaser documents with an overview of the Altuglas International division, according to the people.
Companies have been seeking to offload peripheral businesses in a bid to boost returns and fend off criticism from activist investors. Carveouts by European companies hit a record last year and could rise further in 2020 as firms seek to weather the after-effects of the coronavirus pandemic, a top Credit Suisse Group AG dealmaker said last week.
Streamlining Operations
Some chemical producers have been able to ride through the crisis relatively unscathed, particularly those making products like cleaning solvents and protective sheets which are seeing increased sales. A gauge of European chemical companies has risen 1.8% over the past 12 months, bucking the 5.4% decline in the Stoxx Europe 600 Index.
Solvay SA is also exploring a sale of two units as Chief Executive Officer Ilham Kadri pushes ahead with efforts to streamline the Belgian chemical maker, people with knowledge of the matter said. The potential divestments include a unit that works with the compound strontium carbonate, which could fetch around 150 million euros, and another making chemicals used in shampoo and dishwashing products, the people said.
The volume of dealmaking globally has fallen 47% this year to $991 billion, according to data compiled by Bloomberg. Some shelved deal processes have been revived in recent weeks, with Bridgepoint preparing to restart a bidding process for Iberian agrochemical business Rovensa, Bloomberg News reported this month.
Sasol Sale
Arkema’s Altuglas sale is attracting initial interest from private equity firms including Advent International, Rhone, SK Capital Partners and Triton Partners, the people said. The business produces polymethyl methacrylate-based plastics, which are used in car parts like headlights as well as building materials. Colombes, France-based Arkema hasn’t decided when to seek first-round bids and could wait until after summer to formally solicit offers, one of the people said.
Beyond Europe, Sasol Ltd. is attracting interest in a large stake it’s selling in the Lake Charles chemical complex in the U.S. The South African company has received offers from Ineos Group Ltd., Chevron Phillips Chemical Co. and LyondellBasell Industries NV for the holding, which could fetch more than $2 billion, people familiar with the matter said earlier this month.
All the companies’ deliberations are at an early stage, and there’s no certainty the suitors will submit bids, the people said.
Representatives for Total, Arkema, Advent, Rhone, SK and Triton declined to comment. A spokesman for Solvay said the chemical group has a clear plan to unlock value and regularly receives approaches, particularly after last year’s strategy update. He declined to comment further. A spokesman for Sasol said the firm’s asset disposal process had yielded “good interest from strong contenders.”
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