CHIMCOMPLEX S.A. To:
Bucharest Stock Exchange
Financial Supervisory Authority
Financial Instruments and Investments Sector
Current report prepared in accordance with the FSA Regulation no. 5/2018 on issuers of financial instruments and market operations.
Date of report | February 29, 2024 |
Company name | CHIMCOMPLEX SA Borzeşti |
Registered office | Str. Industriilor, nr.3, Oneşti, Bacău county, |
Romania | |
Telephone/fax number | 0234/302100; 0234/302102 |
Website | http://www.chimcomplex.com |
ir@chimcomplex.com | |
Unique registration code with | RO960322 |
the JRB | |
Serial No in the Registry of | J04/493/1991 |
Commerce | |
Subscribed and paid-in share | 304.907.851 lei |
capital | |
The main characteristics of | • Nominative shares, dematerialized, whose records |
securities | are kept by the Central Depository SA Bucharest |
• Nominal value, lei/share: 1 leu/share | |
• Number of shares: 304,907,851 | |
The regulated market on | BVB, standard category, symbol CRC |
which the issued securities | |
are traded | |
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
Presentation of the preliminary financial results, from the current activity, for 2023
- Revenue: Total revenues in 2023 were of 1,366,632 thousand lei, of which 1,343,854 thousand lei operating income and 22,778 thousand lei financial income.
- Costs: The total expenses recorded in 2023 were of 1,290,728 thousand lei, of which 1,231,465 thousand lei operating expenses and 59,263 lei thousand financial expenses.
- Profit/Loss: As of December 31, 2023, the company recorded an operating profit (operating result) of RON 112,389 thousand lei. On total activity, the net result was profit of 75,904 thousand lei.
Lei | ||||
December 31st | December 31st | |||
2023 | 2022 | |||
Total gross income, showed | ||||
separately: | 75.904.125 | 311.255.153 | ||
-operating result | 112.388.846 | 327.196.547 | ||
-financial result | (36.484.721) | (15.941.394) | ||
Corporate income tax expenses | - | (55.919.098) | ||
Deferred tax revenue | - | 10.725.868 | ||
Net result | 75.904.125 | 266.061.923 | ||
In accordance with the data in the company's financial communication calendar and in compliance with the provisions of the legislation specific to the capital market regarding reporting to capital market institutions and shareholders, CHIMCOMPLEX SA Borzești informs all those interested of the individual preliminary financial statements concluded on 31.12.2023, prepared in accordance with the provisions of Order no. 2844/2016 for the approval of accounting regulations in accordance with the International Financial Reporting Standards applicable to companies whose securities are admitted to trading on a regulated market, as subsequently amended and supplemented ("OMFP 2844/2016"). These provisions are in accordance with the provisions of International Financial Reporting Standards adopted by the European Union ("EU IFRS").
The unaudited preliminary financial statements for 2023 have been prepared in accordance with the accounting policies that will be used to prepare the annual financial statements for 2023. The audited annual consolidated final financial statements will be published in March 2024.
These preliminary financial statements present the financial results related to the current activity carried out by the company in 2023. Until the approval of the financial statements in final form, changes may occur whose influence cannot be quantified at the date of this report and which we draw attention to, could influence the total financial results for 2023.
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
1. ECONOMIC AND FINANCIAL SITUATION
1.1. Presentation of the financial results for the period January-December 2023
The financial statement related to the activity carried out by the company in the period January- December 2023, compared to the same period of the previous year, is presented below:
Economic and financial | Year 2023 | Year 2022 | Difference | % | ||||||||||
Indicators | thousand lei | thousand lei | thousand lei | |||||||||||
1 | 3 | 2 | 4 = 3 - 2 | 5=4/2*100 | ||||||||||
Turnover | 1.399.299 | 2.258.532 | -859.234 | -38,04 | ||||||||||
Total revenue | 1.366.632 | 2.415.212 | -1.048.580 | -43,42 | ||||||||||
-operating income | 1.343.854 | 2.385.750 | -1.041.895 | -43,67 | ||||||||||
-financial income | 22.778 | 29.463 | -6.684 | -22,69 | ||||||||||
Total expenses | 1.290.728 | 2.103.957 | -813.229 | -38,65 | ||||||||||
-operating expenses | 1.231.465 | 2.058.553 | -827.088 | -40,18 | ||||||||||
-financial expenses | 59.263 | 45.404 | 13.859 | 30,52 | ||||||||||
Gross result | 75.904 | 311.255 | -235.351 | -75,61 | ||||||||||
-operating result | 112.389 | 327.197 | -214.808 | -65,65 | ||||||||||
-financial result | -36.485 | -15.941 | -20.543 | * | ||||||||||
Income tax expenses | 0 | 55.919 | -55.919 | -100,00 | ||||||||||
Deferred tax revenue | 0 | 10.726 | -10.726 | -100,00 | ||||||||||
Net result | 75.904 | 266.062 | -190.158 | -71,47 | ||||||||||
The downward trend of consumption that started in the second half of 2022 was maintained until the end of 2023, which caused Chimcomplex's sales value to decrease in 2023 by 38%, compared to 2022. Despite this development, the company managed to achieve an operating profit margin of 8% between January and December 2023, following efforts to reduce utility and main raw material costs.
The company correlated production with the sales trend on the profile market, so that the profit margin was eroded by operating at lower capacity, especially with the sections that consume large electricity and natural gas during 2023.
The negative net financial result in 2023 was mainly influenced by the increase in interest expenses following the increase in the EURIBOR variable margin and the loans contracted in the last 12 months. Exchange differences related to the revaluation of loans also had a significant influence.
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
The company's management has continuously made efforts to reduce the costs of utilities and main raw materials, the evolution of purchase prices being highlighted in the table below:
Between January and December 2023, the company produced and delivered two main categories of finished products:
- Polyols - polyethers with a share of 48.9% in total sales.
- Chlorosodium products with a share of 46.5% in total sales.
Chimcomplex focused its activity on polyols/polyethers and caustic soda sectors, which are the most profitable.
Share of main products in total sales in 2023 compared to 2022:
Structura vânzărilor 12 luni 2023 | |
% | |
4,6… | |
46,50% | 48,90% |
Structura vânzărilor 12 luni 2022
%
7,40%
44,10%
48,50%
Polioli | Clorosodice | Alte |
Polioli Clorosodice Alte
The Chlorosodium products marketfaced a tumultuous year in 2022 and was impacted by Russia's invasion of Ukraine. This led to skyrocketing oil and gas prices just as the market was starting to stabilise following the pandemic.
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
The main lye-consuming industries (alumina, pulp and paper, detergents, water treatment, chemical synthesis) reacted in correlation with demand that depreciated from month to month.
Some alumina producers (customers of chlorosodium products) have closed or reduced their operating rates to levels between 20 and 40 %.
The spot price of caustic soda amounted to EUR 1500/dmt in December 2022, after which, from January 2023, the decline began, generated on the one hand by significant volumes imported from China, Egypt, Saudi Arabia, etc., but also due to the reduction of utility costs (and consequently also production costs) in the EU area.
The evolution of caustic soda quotations according to ICIS in 2023 is shown below:
The main challenge we faced in 2023 was the decrease in demand for caustic soda and the struggle to maintain market segments in all European countries. A very high availability of the product led to the galloping depreciation of the price.
All chlorine derivatives (PVC, Polyethers, ECH, etc.) have suffered as a result of reduced demand, high inflation and high interest rates on financing.
Europe has 62 electrolysis plants in 19 countries, with a capacity of 12,108,000 tonnes of chlorosodium products. (source: EUROCHLOR)
Compared to the production capacity of the two Chimcomplex electrolysis, totaling 208,000 tons / year, in 2023 there were 161,100 tons of lye of 33%, of which 151,670 tons of lye and 7874 tons of solid caustic soda were sold, which represents 72%, above the European average.
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
During the analyzed period, Chimcomplex registered a decrease in demand of 8% compared to 2022, generated by the temporary closure of some production facilities and the reduction of the capacities of others, located near the Chimcomplex plant in Ramnicu Valcea.
Demand for chlorine in Europe showed no signs of improvement until the end of the year. Producer margins are the lowest due to rising raw material prices, and operating rates remain unchanged, between 58-67%
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
Caustic soda stocks (tonnes)
2022 | 2023 | |
January | 226,493 | 291,138 |
February | 250,434 | 317,909 |
March | 210,522 | 310,749 |
April | 192,315 | 293,547 |
May | 193,168 | 267,644 |
June | 193,054 | 206,733 |
July | 206,008 | 232,312 |
August | 241,236 | |
September | 188,459 | 261,042 |
October | 186,491 | 212,656 |
November | 229,497 | 212,227 |
December | 257,368 | 221,781 |
The revival of caustic soda consumption is generated by the recovery of the alumina, pulp and paper and water treatment industries, but also by the recovery of chlorine derivatives consumption - mainly PVC and polyurethanes.
In addition, the cessation of the conflict in Ukraine and the start of Turkey's reconstruction will lead to a repositioning of consumption and an increase in the operating rates of production capacities.
European caustic soda production will remain largely stable at the low level observed in 2023. Apart from replenishment for some chlorinated derivatives after the seasonal slowdown, there are still no signs of a real recovery of the industry and therefore no significant changes in caustic soda production are expected in the first quarter of 2024.
Revisions scheduled in spring will bring a temporary reduction in supply, but if there are no unforeseen changes in demand for chlorine or caustic soda, this will be manageable in the market. There is more uncertainty in the second half of the year, but there are signs of a recovery in the industry, although it is unlikely to be a quick one.
High transport quotations and the Panama and Suez Canal crisis will limit Europe's import and export opportunities in the short term, but the impact on domestic supply will be limited and local chlorine demand will remain the main driver of caustic soda availability.
As for the polyether market, in the first half of 2023 continued the downward trend of consumption, started in the second half of 2022. Inflation and high interest rates on loans,
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
still high energy and gas prices led to a sharp decrease in the consumption of durable goods (consumption that had increased significantly during the pandemic).
Demand for polyethers returned to growth in September after the holiday period, a trend that continued in Q4 leading to a return to growth in sales prices.
Low unemployment, falling inflation and rising household consumption will drive an increase in demand for polyethers in 2024.
The most affected industries consuming polyols were construction, comfort (mattresses, chairs, furniture) and home appliances.
Low consumption of polyethers generated a continuous decrease in prices in the first 9 months of 2023. The pressure on prices was accentuated by massive imports from China and Korea, at prices well below the level of European producers (the price difference coming from the different cost of utilities).
In the fourth quarter, polyether prices increased on average by EUR 100/tonne compared to September. And the quantities sold by Chimcomplex increased by 10% compared to the third quarter.
Total sales 2023 polyethers 80,138 tons, respectively 95% of the sales volume made in 2022.
Currently, arbitrage with China and Korea is closed to flexible polyols, which will cause a significant decrease in imports, but remains open to rigid polyols and SEAC.
According to reports by Chemical Market Analytics, prices on the polyether market decreased by 425-450 euros/ton between January and December 2023, being well below the level recorded in the same period last year.
Polyether polyols | ||||||
Flexible in € per Mt | Rigid in € per Mt | |||||
2023 | reduced | grown | medium | reduced | grown | medium |
Jan | 1700 | 1950 | 1825 | 2400 | 2700 | 2550 |
Feb | 1650 | 1900 | 1775 | 2300 | 2600 | 2450 |
Mar | 1550 | 1800 | 1675 | 2200 | 2500 | 2350 |
Apr | 1600 | 1750 | 1675 | 2200 | 2400 | 2300 |
May | 1550 | 1700 | 1625 | 2100 | 2400 | 2250 |
Jun | 1450 | 1600 | 1525 | 2000 | 2300 | 2150 |
Jul | 1300 | 1450 | 1375 | 1900 | 2200 | 2050 |
Aug | 1200 | 1350 | 1275 | 1800 | 2200 | 2000 |
Sep | 1200 | 1400 | 1300 | 1800 | 2200 | 2000 |
Oct | 1275 | 1400 | 1338 | 1800 | 2200 | 2000 |
Nov | 1350 | 1450 | 1400 | 1900 | 2300 | 2100 |
Dec | 1350 | 1450 | 1400 | 1900 | 2300 | 2100 |
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
Polyether polyols | ||||||
flexible in € per mt | Rigid in € per mt | |||||
2022 | reduced | grown | medium | reduced | grown | medium |
Jan | 2330 | 2530 | 2430 | 2830 | 2980 | 2905 |
Feb | 2300 | 2530 | 2415 | 2830 | 2980 | 2905 |
Mar | 2300 | 2530 | 2415 | 2830 | 2980 | 2905 |
Apr | 2530 | 2730 | 2630 | 2930 | 3080 | 3005 |
May | 2480 | 2610 | 2545 | 2800 | 3000 | 2900 |
Jun | 2330 | 2580 | 2455 | 2700 | 2900 | 2800 |
Jul | 2200 | 2450 | 2325 | 2600 | 2800 | 2700 |
Aug | 2150 | 2350 | 2325 | 2600 | 2800 | 2700 |
Sep | 2100 | 2300 | 2325 | 2650 | 2850 | 2700 |
Oct | 2200 | 2500 | 2350 | 2550 | 2900 | 2725 |
Nov | 2150 | 2450 | 2300 | 2500 | 2900 | 2700 |
Dec | 1800 | 2100 | 1950 | 2450 | 2800 | 2625 |
The persistent feeling of a sluggish economy in Europe was again reflected by the correction of GDP for this year, which is falling. Compared to the 1.1% expected earlier this year, we are likely to see only 0.5% growth now, at best. There are certainly multiple obstacles, and growth drivers are still lacking from final consumers, as well as a lack of certainty and optimism on the part of the private consumption sector.
Germany, Europe's production engine, entered a technical recession in the second half of 2023.
The construction sector appears to be the weakest of the various end markets and a similar picture can be seen regarding export opportunities for various polyurethane applications. Industrial production is forecast to grow slowly over the next three quarters in all countries and sectors.
There is, however, optimism for polyether polyols in Europe in 2024
- it is based on a record level of savings of individuals / individuals.
- that interest rates will fall, along with inflation.
- pent-updemand in today's automotive sector.
- private consumption is estimated to grow by around 1.5% next year (the upholstery sector is expected to grow again, especially in the tourism area, as investment in this segment was relatively low during the COVID years)
- stronger demand for exports.
Forecasts
The polyurethane industry remained in crisis, with minor changes or even stagnation in demand in January as private consumption continues to be low in conjunction with weaker activity in the construction sector. The latter is not expected to change significantly in February or March. Q2 is likely to see some positive results with the likelihood of interest rate cuts by the European Central Bank. This will give a boost to the activity of the construction sector in the coming quarters, however, most likely this major change will be felt in 2025.
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
Problems in the Suez Canal and military tensions in the Middle East are estimated to have an impact on Europe's polyol and polyurethane industries. The transport time of Asian polyols, in particular flexible polyols, is expected to be affected by a delay of 14-20 days compared to normal transit time (depending on loading ports in China and South Korea), leading to an increase in transport cost by €100/tonne. Theoretically, this will reduce the flow of imports or delay monthly imports of 5-10,000 tonnes of polyol that frequently arrive from Asia, and European production will have to adapt.
Problems with the transportation of goods and services from east to west can also have an impact on certain main raw materials, materials or finished products for other industries that affect the polyurethane industry as well, such as electrical appliances and components, home appliances and automotive components. We may see more local production versus imports of finished products, although it's far from have a direct implication. Some European car manufacturers have reduced production due to shipping delays, while no additional rolling rate has been observed in Europe's upholstery sector.
All in all, polyether quantities have decreased and are likely to continue with a significant decrease in imported quantities, but local production will fall even further due to planned or unplanned production stoppages. Several manufacturers could resume production in February depending on how quickly they complete repairs. This reduction in the availability of polyethers in the market leads to a more balanced situation, and manufacturers will certainly try to regain some of profitability after almost a year of minimal or negative profitability.
Chemical Market Analytics (CMA) forecasts a price increase for polyether-polyols of around €100-200/tonne in February, and this trend in which futures prices are expected to be higher than spot prices, which we will see in March and April, is further encouraged by the upstream situation of the propene oxide-propylene/oil ratio.
CHIMCOMPLEX S.A. BORZESTI
St. Industriilor nr. 3, Oneşti, jud. Bacau, Romania Phone 0234/302.250; Fax 0234/302.102 Email: office@chimcomplex.com
Web: www.chimcomplex.com
Trade Registry J04/493/1991, URC 960322 Subscribed and paid up share capital: 304907851 RON IBAN: RO60BUCU1111215962132
ALPHA BANK BUCHAREST
RO2021.055.061Q RO2021.055.061E RO2018.055.061
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Chimcomplex Borzesti SA published this content on 29 February 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 March 2024 11:14:56 UTC.
