Borealis AG, the Austria-headquartered chemicals giant, announced record annual net profits, numbers the group said were boosted by improved margins in its olefins and polyolefins operation.
The company reported net sales of 8.33 billion ($9.3 billion) in 2014, up from 8.11 billion euros ($9 billion) in 2013.
Net profits for 2014 were 517 million euros ($578.8 million), up 35 percent from 2013's profits of 423 million euros ($473.5 million).
Borealis also pointed to an improved contribution from its Borouge joint venture operation in Abu Dhabi, with the start-up of Borouge 3 in Ruwais.
According to Borealis, Borouge 3 will deliver an extra 2.5 million metric tons of polyolefins “when it is fully ramped up,” bringing total Borouge capacity to 4.5 million metric tons.
The group claimed the complex would make it the largest integrated polyolefins complex in the world, with a combined capacity of around eight million tonnes.
The only fly in the Borealis ointment was an underperforming fertilizer business within its base chemicals operation, due to what the group called “operational challenges” at its newly-acquired French plants.
Speaking about the group's results in what had been a “year of consolidation” for the business, chief executive Mark Garrett said 2014 had been about “working to capture strategic opportunities to remain robust in our traditional European base, giving the company multiple sources of profit while at the same time building Borouge.”
Looking ahead, Garrett said Borealis would be impacted by negative inventory effects in the first half of 2015 on the back of the rapidly falling monomer prices, and he warned that Borouge's profitability would be lower due to the lower oil price environment.
“However, a lower cost base will help improve the competitiveness of European producers,” he said.
“Borealis expects to see a solid but lower profitability in 2015 compared to 2014. The company will harvest the benefits of the consolidation completed in 2014 as well as Borouge 3 becoming fully operational.
“In addition, Borealis is well positioned for the future as the company committed to investments to increase feedstock flexibility in 2014, which will help the company remain competitive and resilient also in the long run.”