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Hexion: decline in Forest Products Resins turnover

23.03.2020 − 

In the 2019 financial year the forest products resins business division of US resin manufacturer Hexion generated turnover of US$1.485bn. This represents a 12% decline vis à vis the preceding year’s figure. The contractually agreed passing on of lower raw material costs had a negative impact on turnover to the amount of -US$79m. Viewed over the entire period of 2019, average prices for methanol and urea fell short of the comparative figure of the previous year by 22% and 5% respectively, Procurement costs for phenol, in contrast, increased by 7%. These three upstream products, according to Hexion, account for approximately 50% of total raw material costs. The EBITDA segment decreased by 1% vis à vis the preceding year to US$281m.

Including the second business division - epoxy, phenolic and coating resins -, group turnover declined by 11% to US$3.374bn in the 2019 financial year. The EBITDA segment, due to the positive development in the forest products resins business division, decreased at a less significant rate of 9% to US$400m. Operating profit, at US$45m, only amounted to one fifth of the previous year’s figure. The significant improvement in pre-tax and net profit to US$3.016bn and US$2.805bn respectively is a result of a revaluation of asset values and liabilities within the scope of the Chapter 11 process implemented in the second quarter.

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