United states securities and exchange commission
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- Bu səhifədəki naviqasiya:
- Industrial Intermediates Infrastructure
- 2017 Versus 2016
- 2016 Versus 2015
- Industrial Intermediates Infrastructure Outlook for 2018
- PACKAGING SPECIALTY PLASTICS
- Packaging Specialty Plastics Outlook for 2018
2017 Versus 2016 Industrial Intermediates & Infrastructure net sales were $12,647 million in 2017, up 17 percent from $10,832 million in 2016. Pro forma net sales were $12,640 million in 2017, up from $10,820 million in 2016. Pro forma net sales increased 17 percent in 2017, with local price up 10 percent and volume up 7 percent. Local price was up in all geographic regions and all businesses driven by higher raw material costs, pricing initiatives and tight market conditions due to supply disruptions in the industry. Polyurethanes & 50 Table of Contents CAV volume increased in all geographic regions due to strong demand for downstream, higher margin systems applications, new production from Sadara and increased demand for caustic soda and vinyl chloride monomer in EMEA resulting from tighter supply/demand fundamentals. Industrial Solutions reported volume gains in all geographic regions driven by new production from Sadara, increased demand for products used in crop protection offerings and solvents used in electronics processing, and higher catalyst sales in Asia Pacific. Construction Chemicals volume increased driven by growing demand for acrylics-based products in the U.S. & Canada and methyl cellulosics-based products in EMEA. Volume decreased in Energy Solutions due to reduced project activity in energy market sectors. Pro forma Operating EBITDA was $2,282 million in 2017, up from $1,672 million in 2016. Compared with last year, pro forma Operating EBITDA increased as higher selling prices, increased sales volume, higher equity earnings from the Kuwait joint ventures, lower equity losses from Sadara and lower SG&A and R&D spending more than offset higher feedstock, energy and other raw material costs. 2016 Versus 2015 Industrial Intermediates & Infrastructure net sales were $10,832 million in 2016, down 21 percent from $13,691 million in 2015. Compared with 2015, net sales declined 13 percent due to portfolio and other actions, primarily reflecting the split-off of the chlorine value chain, and local price declined 8 percent. Local price decreased across all geographic regions and all businesses in response to lower raw material costs. Volume increased 1 percent with results mixed by business. Polyurethanes & CAV reported volume growth driven by demand for higher-margin system house applications used in energy, industrial and consumer end markets, increased demand for polyols in Asia Pacific due to an expanding customer base and favorable supply and demand fundamentals for chlor-alkali and vinyl products in EMEA. Construction Chemicals volume increased in all geographic regions, except U.S. & Canada, on strong demand for cellulosics- and acrylics-based products. Energy Solutions volume declined as a result of weakness in the energy sector. Industrial Solutions volume was flat as demand in crop defense, electronics and textile market sectors was offset by reduced demand for deicer fluids, industrial lubricants and long market conditions for ethylene oxide/ethylene glycol. Operating EBITDA for 2016 was $1,672 million, compared with $2,425 million in 2015. Compared with 2015, Operating EBITDA declined due to lower selling prices, the absence of earnings from divested businesses, reduced equity earnings from the Kuwait joint ventures and higher equity losses from Sadara related to start-up expenses. These declines were partially offset by lower feedstock and raw material costs, lower R&D and SG&A spending and higher equity earnings from Map Ta Phut Olefins Company Limited. Industrial Intermediates & Infrastructure Outlook for 2018 Industrial Intermediates & Infrastructure's 2018 Operating EBITDA is expected to increase moderately compared with 2017 pro forma Operating EBITDA, driven by the favorable impact of cost synergies, sales volume growth and higher equity earnings which are expected to more than offset the unfavorable impact of competitive pricing pressure and increased feedstock and other raw materials costs. Local price will primarily follow feedstock and energy prices but will also be influenced by supply and demand fundamentals, particularly in Polyurethanes & CAV and Industrial Solutions. Polyurethanes & CAV volume is expected to grow in excess of GDP, driven by strong demand for products used in energy efficiency applications as well as consumer-driven demand in emerging geographies and additional capacity from Sadara. Industrial Solutions volume is expected to increase as a result of Sadara capacity that came on-line in 2017, with growth also expected for amines, lubricant additives and other chemical intermediate products. Construction Chemicals volume is expected to increase across all geographic regions primarily driven by product innovation and growth in cellulosics, latex powders and acrylics-based products. Energy Solutions expects volume growth driven by the exploration and production end-markets. PACKAGING & SPECIALTY PLASTICS The Packaging & Specialty Plastics segment is a market-oriented portfolio composed of two global businesses: Hydrocarbons & Energy and Packaging and Specialty Plastics. The segment is advantaged through its low cost position into key feedstocks and broad geographic reach, with manufacturing facilities located in all geographic regions. It also benefits from R&D expertise to deliver leading-edge technology that provides a competitive benefit to customers in food packaging and other high-growth end use markets like transportation and consumer durables. Taken together, the businesses in this segment represent the world's leading plastics franchise. This segment also includes the results of The Kuwait Styrene Company K.S.C. ("TKSC") and The SCG-Dow Group, as well as a portion of the results of EQUATE, TKOC, Map Ta Phut Olefins Company Limited and Sadara, all joint ventures of the Company. 51 Table of Contents Dow is responsible for marketing a majority of Sadara products outside of the Middle East zone through Dow’s established sales channels. As part of this arrangement, Dow purchases and sells Sadara products for a marketing fee.
2017 Versus 2016 Packaging & Specialty Plastics net sales were $21,456 million in 2017, up 17 percent from $18,404 million in 2016. Pro forma net sales were $22,392 million in 2017, up from $19,848 million in 2016. Pro forma net sales increased 13 percent from 2016 with local price up 8 percent and volume up 5 percent. Local price increased in all geographic regions and both businesses in response to higher feedstock, energy and other raw material costs. Double-digit price increases were reported in Hydrocarbons & Energy as a result of higher Brent crude oil prices, which increased approximately 22 percent compared with 2016. Local price also increased in the U.S. & Canada as a result of tight supply conditions due to hurricane-related disruptions. Volume increased in both businesses and across all geographic regions, except Latin America. Packaging and Specialty Plastics volume growth was driven by continued consumer-led demand in health and hygiene end-markets in the Americas, strong demand for food and specialty packaging solutions, particularly in Asia Pacific, and increased use of elastomers in packaging and footwear applications. Volume decreased for wire and cable applications as a result of hurricane-related supply disruptions. Volume growth in EMEA and Asia Pacific was enabled by an increase in production volume at Sadara. Hydrocarbons & Energy volume increased in all geographic regions, except Asia Pacific, primarily due to higher sales of ethylene and ethylene by-products enabled by the start-up of a world scale ethylene production facility in Texas in September 2017. Pro forma Operating EBITDA for 2017 was $4,698 million, down from $5,129 million in 2016. Pro forma Operating EBITDA decreased in 2017 as the impact of higher feedstock and energy costs, planned maintenance turnaround spending, increased U.S. Gulf Coast start-up and commissioning costs and hurricane-related expenses more than offset increased selling prices and higher equity earnings. 2016 Versus 2015 Packaging & Specialty Plastics net sales for 2016 were $18,404 million, essentially flat from $18,357 million in 2015. Volume increased 9 percent, local price decreased 8 percent and portfolio and other decreased 1 percent. Volume increased across all geographic regions and both businesses. Volume increased in Hydrocarbons & Energy due to third party supply agreements. Packaging and Specialty Plastics volume increased due to demand growth in industrial and consumer packaging and health and hygiene market sectors; increased use of elastomers in transportation, consumer goods and footwear market sectors; and continued demand for power cable installations and fiber optics. Volume growth in Asia Pacific was also enabled by new production from Sadara. Local price decreased across all geographic regions and both businesses in response to lower feedstock, energy and other raw material prices and competitive pricing pressures. Double-digit price declines were reported in Hydrocarbons & Energy as a 52 Table of Contents result of lower Brent crude oil prices, which declined approximately 16 percent compared with 2015. Portfolio actions decreased net sales by 1 percent, primarily reflecting the split-off of the chlorine value chain. Operating EBITDA for 2016 was $4,633 million, down from $4,812 million in 2015. Operating EBITDA decreased in 2016 as the impact of higher sales volume, lower feedstock, energy and other raw material costs and higher equity earnings from The SCG-Dow Group were more than offset by lower selling prices, lower equity earnings from EQUATE and increased equity losses from Sadara related to start-up expenses. Packaging & Specialty Plastics Outlook for 2018 Packaging & Specialty Plastics' 2018 Operating EBITDA is expected to increase meaningfully compared with 2017 pro forma Operating EBITDA, driven by the favorable impact of cost synergies and contributions from new capacity that will more than offset increased commissioning costs and increased feedstock and energy costs. In 2018, the Company expects crude oil prices, on average, to be higher than 2017. As a result, feedstock and energy costs are expected to be higher than 2017 levels. Global ethylene margins are expected to remain healthy in 2018, supported by demand growth as well as delays in new industry ethylene production capacity in the U.S. & Canada. Ethylene margins could vary materially from these expectations depending on global GDP rates, global operating rates and changes in global oil prices. Sales for the segment are expected to be flat compared with 2017 as increased sales in Packaging and Specialty Plastics are expected to offset declines in Hydrocarbons & Energy. Packaging and Specialty Plastics sales are expected to increase over the prior year driven by volume growth - reflecting a full year of Sadara volume, as all production facilities have commenced operations, and new capacity from Dow's U.S. Gulf Coast assets. Hydrocarbons & Energy sales are expected to decline as a result of higher crude oil and naphtha prices which will cause a shift to lighter cracker feedslates, resulting in lower production of ethylene by-products. Sales of ethylene are also expected to decline due to increased internal consumption as a result of the start-up of new Dow assets on the U.S. Gulf Coast. Price in both businesses is expected to be influenced by changes in feedstock costs. Yüklə 5,84 Mb. Dostları ilə paylaş:
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