Second quarter proves profitable for suppliers: “Left the crisis behind”

As financial results are posted for the first half of 2010, it becomes quickly clear that many plastics suppliers have benefitted greatly from an improving market.

At BASF, sales in its plastics business were up 48% in the second quarter compared with the weak level of the previous year. Earnings rose even more, by 153% compared to the same quarter in 2009 and also up over the first quarter of this year.

The story was similar at Bayer, where its MaterialScience division—supplier of polycarbonate and polyurethane—pulled forward in terms of sales and profits in the second quarter. "MaterialScience has left the crisis behind and saw business expand more strongly than expected. Volumes have returned to the pre-crisis level," stated the company's chairman, Werner Wenning, following the publication of the interim report for the second quarter.

The MaterialScience business unit improved sales by 46.9% versus the prior-year quarter. Demand rose significantly in all product groups and regions, reported the company, with sales up 21.3% compared to the first quarter of 2010. Its business with raw materials for polyurethanes improved by a currency-adjusted 37.1% year on year, with volumes up as well as selling prices in Asia/Pacific and Europe, enabling it to offset price declines in the Americas. Bayer's polycarbonates business was even stronger, with sales of PC rising by a currency-adjusted 59.4%, and prices also increasing.

At plastics and chemicals supplier Solvay, results at its its plastics business, and especially its engineering thermoplastics business, improved considerably too. Demand growth improved everywhere but most markedly in Asia, reported Solvay, as its sales volume for its specialty polymers' business improved by 45% (half-year) and 48% (for the 2nd quarter). Its PVC business did not perform, as well as Solvay said demand growth for the material was limited in Europe, where the supplier's PVC operation is most active.

At Clariant, whose offerings in the plastics industry include a range of colorants, additives and masterbatches, officials said second quarter sales rose 18% (currency adjusted) "as global economic activity continued to rebound year on year." Volumes were up 20% over the extremely weak second quarter 2009, but remained significantly below pre-crisis levels, reported Clariant. —mpweditorial@cancom.com