#Textile chemistry
Borealis delivers solid financial result for 2020 in a volatile market environment
- Borealis announces a solid full-year 2020 result with a net profit of EUR 589 million despite a market environment heavily impacted by the COVID-19 pandemic
- Net profit of EUR 210 million in fourth quarter of 2020 is a very strong finish to the year and substantial increase over both fourth quarter 2019 and third quarter 2020
For the full year 2020, the company recorded a net profit of EUR 589 million, compared to EUR 872 million in 2019. The 2020 result was negatively impacted by the lower oil price environment, which resulted in reduced light feedstock advantage and negative inventory effects in Europe, and a lower polyolefins price environment in Asia. Additionally, a deteriorating fertilizer market environment negatively impacted the financial result. Despite the COVID-19 pandemic, demand for polyolefins remained healthy, leading to a slight sales volume increase compared to the level of 2019.
In the fourth quarter, net debt decreased by EUR 77 million. Over the full year 2020, net debt increased by EUR 264 million. Operating cash flow in 2020 exceeded the level of 2019, allowing for ongoing investments in large growth projects, acquisitions and the payment of a EUR 300 million dividend for 2019 to Borealis shareholders. Borealis financial position remained strong, with a gearing of 29% at year-end 2020.
Review and Outlook
“While the Borealis net profit of EUR 589 million is significantly below the 2019 level, it is a strong financial result in the context of a very challenging market environment impacted by the pandemic and a declining oil price which has led to a negative price and inventory value development,” comments Borealis CEO Alfred Stern.
“Thanks to our safety culture, the agile mind-set of our organisation, and the dedication of all our staff we managed to continue operations in all of our production locations throughout the entire year, without having to implement mitigating actions like short-time work. Once again, I would like to thank all our people for their dedication and continued support. The COVID-19 pandemic has demonstrated the importance of the Borealis product portfolio for more sustainable living. We are convinced that Borealis is in a strong position to take advantage of the opportunities for recovery that the post-pandemic economy will provide by maintaining our commitment to being the leading provider of sustainable chemical and innovative plastic solutions that create value for society.”
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