February, 18, 2016 - Thanks to positive effects from the increase in petrochemical spreads due to lower oil and naphta prices, as well as to the operating performance of its plants, stronger sales at the United States & Europe operation and the growth in exports associated with the weaker local currency and international petrochemical spreads, Braskem posted EBITDA of R$9.37 billion last year, an increase of 67% from 2014. In dollars, EBITDA was USD 2.8 billion, advancing 17% from 2014.

In 2015, Braskem's crackers operated at an average capacity utilization rate of 89%, an improvement of 3 % on the prior year, which reflects its good operating performance, with production at the Basic Petrochemicals Unit setting a new record. Excluding the impact from the inadequate supply of feedstock at the Rio de Janeiro complex, the utilization rate in the year would have been 92%. In the last quarter of the year, the crackers operated at a capacity utilization rate of 83%, which reflects the impact from the incident at the petrochemical complex in Mauá, São Paulo.

In the United States and Europe, polypropylene (PP) plants operated above their nameplate capacity in the fourth quarter, at an average utilization rate of 101%, which reflects the capture of operating efficiency gains and stronger demand for the product in the United States. In the quarter, production set a new record of 510 kton, advancing 9% on the year-ago period. In 2015, the industrial units in the United States and Europe operated at an average capacity utilization rate of 98%, an increase of 6 percentage points from 2014.

Given the weak demand for resins (PE, PP and PVC) in Brazil, the domestic market contracted 7.6% from 2014, to 4.9 million tons. Last year, Braskem's sales in the domestic market amounted to 3.4 million tons, down 6% from 2014. To offset the contraction in the domestic market, Braskem increased its exports of resins by 28% and of basic petrochemicals by 1%.

Braskem posted net income of R$2.89 billion in 2015. In the fourth quarter, net income was R$158 million, reversing the loss posted in the same quarter of the previous year. Braskem's financial leverage, as measured by the ratio of net debt to EBITDA in U.S. dollar, ended the quarter below 2 times (1.91), which is the lowest level of the last nine years.

"Despite the weak performance of the Brazilian economy, Braskem's result was very good, thanks to the capture of operating efficiency gains in Brazil and abroad and to the strategy of directing a portion of production to export markets, not to mention important external factors, such as the weaker local currency and international petrochemical spreads," said Carlos Fadigas, Braskem CEO. "But given the challenging scenario for 2016 in Brazil, Braskem continues to focus on improving its competitiveness through cost-cutting programs, support for the plastics converter chain and higher exports."

Startup of operations in Mexico

In this first quarter of 2016, Braskem is commissioning the Mexico Complex, which brings important diversification in terms of its feedstock profile and geographies. Located in Nanchital in the Mexican state of Veracruz, the petrochemical complex, which is the result of a US$5.2 billion investment in partnership with Idesa, has annual production capacity of over 1 million tons of polyethylene (PE) made from ethane supplied by PEMEX. The operations should ramp up gradually over the course of the year and more markedly in the second half of the year.

Source: Braskem