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Braskem’s Recurring EBITDA Grows 46% in 2Q24 Driven by International Market and Sales Optimization, Highlighting the Positive Impact of Geographical Diversification.
Braskem’s recurring EBITDA saw a significant increase of 46% in the second quarter of 2024, positively impacted by the international market and sales optimization. These results are the outcome of successful strategies and rigorous financial management focused on maintaining the company economically healthy.
Braskem, the largest producer of thermoplastic resins in the Americas, achieved a recurring EBITDA of R$ 1.7 billion during the period. This performance reflects not only the benefits of optimized sales but also the effects of geographically diversified operations. Efficient management and financial discipline were crucial in achieving these impressive figures. This strategic approach has ensured solid results and continuous growth, further consolidating the company’s position in the global market.
In the second quarter of 2024, Braskem reported a 46% increase compared to the first quarter of this year and a 137% advance compared to the same period in 2023. This growth was driven by positive effects on international market spreads, an increased sales volume, and the ongoing implementation of cost and expense reduction initiatives. The recurring cash generation in the quarter reached R$ 357 million.
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Results of the Second Quarter of 2024
‘We had a quarter of superior results compared to previous ones,’ said Roberto Bischoff, CEO of Braskem. ‘These results were driven by higher spreads in the international market, due to a better balance between global supply and demand, in addition to the impacts of the conflicts in the Red Sea that elevated freight rates, combined with our continuous efforts in implementing initiatives focused on maximizing our results.’
When compared to the first quarter of 2024, there was an 8% increase in international resin spreads and a 19% increase in key chemicals in Brazil. In Mexico, the increase in PE was 4%. Operationally, the geographical diversification of Braskem’s petrochemical plants played a crucial role in maintaining customer service and mitigating the impacts of outages during the quarter.
In Brazil, climatic events in Rio Grande do Sul affected production, but this was partially offset by increased utilization rates at the petrochemical plants in Bahia and São Paulo. Braskem, the largest producer of thermoplastic resins in the Americas, reported a net loss of R$ 3.7 billion in this quarter, mainly due to the impact of exchange rate fluctuations caused by a depreciation of the Brazilian real against the dollar by 11.3%.
Investment Agreement and New Partnerships
During the period, Braskem announced the signing of an investment agreement with Solví and GRI, involving the company’s equity stake in Cetrel. This transaction will strengthen Cetrel, a leader in environmental and industrial solutions, turning GRI into a national growth platform and resulting in the receipt of R$ 284 million by Braskem.
The company also obtained approval to become a Brazilian Navigation Company (EBN), expecting to start maritime operations in the coming months. With this license, it will be possible to rent or operate ships with contracted crews for maritime transport, and the first cabotage operation should occur between Bahia and Rio de Janeiro.
Braskem also highlighted its partnership with Petrobras, which allowed for successful large-scale tests in the production of Light Hydrocarbon Refinery Stream (HLR) with renewable content, sourced from sugarcane ethanol. The quarter also saw the first sale of circular polypropylene, under the Wenew brand, in partnership with Swiss company Georg Utz AG. This circular PP was produced from chemical recycling of plastic waste and has ISCC certification.
Implementation of Strategy and Resin Sales
In terms of corporate strategy, the construction of the ethane import terminal in Mexico, a continuous effort of the company, reached 75% progress by June. The expectation is that the construction will be completed by the end of 2024, with operations commencing in the first quarter of 2025.
In Brazil, in the second quarter, the sales volume of resins and key chemicals fell by 2% and 5%, respectively, compared to the first quarter of the year. The shutdown of operations at the Petrochemical Hub in Triunfo, Rio Grande do Sul, driven by an extreme climatic event, was partially offset by sales from the plants in Bahia and São Paulo. Compared to the second quarter of 2023, there was an increase of 4% and 3%, due to higher demand and inventory buildup in the chain.
Measures in Maceió and Support for Relocation
Safety continues to be the top priority for Braskem, especially in Maceió. With the risk area fully vacated since 2020, the company is progressing with socio-urban measures, community care in neighborhoods, soil monitoring, and the permanent sealing of salt wells. These actions are in line with agreements with the authorities and approved by the courts.
Braskem is also working to complete indemnities for families, merchants, and businesses in the vacated areas. By July, the Financial Compensation and Relocation Support Program presented 19,153 indemnity proposals, representing 99.9% of the total. Of these, 98.4% were accepted. The differences between submitted and accepted proposals are due to the time needed for evaluation or re-evaluation of amounts by the families.
Source: © Braskem Press
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