Latest news with #FineChemicals
Yahoo
17-07-2025
- Business
- Yahoo
Borregaard ASA (STU:BO4) Q2 2025 Earnings Call Highlights: Strong Growth in BioSolutions and ...
EBITDA: NOK522 million, up from NOK510 million in the same quarter last year. EBITDA Margin: 25.5%, close to the margin in the same quarter in 2024. Earnings Per Share: Increased to NOK2.56 from NOK2.45 in the second quarter last year. BioSolutions Revenue: Operating revenues increased by 3%, with EBITDA reaching NOK338 million, NOK20 million above the second quarter last year. BioMaterials Revenue: Operating revenues were 19% higher than in the second quarter last year, with EBITDA at NOK143 million, NOK53 million higher than the same quarter last year. Fine Chemicals Revenue: Operating revenues were 25% below the second quarter of 2024, with EBITDA at NOK41 million compared to NOK102 million in the second quarter last year. Net Currency Effects: Positive impact of about NOK35 million compared with the second quarter last year. Cash Flow from Operating Activities: NOK385 million in the second quarter. Investments: NOK239 million in the quarter, with significant expenditures at the Sarpsborg site. Net Interest-Bearing Debt: Increased by NOK229 million in the quarter. Equity Ratio: 57% at the end of the second quarter. Leverage Ratio: 1.20 (net interest-bearing debt over EBITDA). Warning! GuruFocus has detected 5 Warning Sign with LTS:0RP6. Release Date: July 16, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points EBITDA increased to NOK522 million, up from NOK510 million in the same quarter last year, indicating strong financial performance. BioSolutions segment showed strong growth driven by increased sales to agriculture, contributing positively to overall results. BioMaterials segment experienced a 19% increase in operating revenues due to higher sales prices and volumes, with a significant improvement in EBITDA. Positive net currency effects across all business areas contributed an additional NOK35 million to EBITDA. The Board approved a NOK138 million environmental investment at the Sarpsborg refinery, expected to reduce CO2 emissions by up to 18,000 tonnes and lower energy costs. Negative Points Fine Chemicals segment saw a decline in results due to lower sales prices for bioethanol, with EBITDA dropping to NOK41 million from NOK102 million in the previous year. Increased wood costs partially offset the positive performance in the BioMaterials segment. The market for advanced bioethanol remains challenging due to supply-demand imbalances driven by EU incentives. The EBITDA margin for Fine Chemicals decreased significantly by 21 percentage points compared to the same quarter last year. Uncertainty related to tariffs, conflicts, and geopolitical tensions may impact Borregaard ASA's market and costs in the future. Q & A Highlights Q: Is there a significant discrepancy between wood costs in the Nordic pulp market compared to the rest of Europe? A: The wood cost level in the Nordic region is much higher than in Europe and other parts of the world. Our reported 5% reduction in wood costs includes a significant transportation component, which may differ from how other companies present their costs. Q: What can you say about volumes in Bioethanol sales over the past three quarters, and should we expect a stable EBITDA level? A: The product mix in Fine Chemical intermediates was slightly weaker in the second quarter, which may slightly affect the remaining quarters. The run rate is close to what we've seen in the past three quarters, with a potential slight improvement in the second half. Q: Can we expect continued sales growth into agriculture for the second half of 2025 and into 2026? A: We believe we are well-positioned to benefit from green trends in agricultural markets, and this trend is across our entire portfolio. We expect agriculture to remain an attractive market for Borregaard. Q: Can you elaborate on the mix improvements in cellulose products and demand from the US? A: Historically, Borregaard has not sold significant volumes into the US. The demand increase is partly driven by capacity closures in the US and Canada, which have impacted the overall market balance, creating opportunities in areas like high-quality casings. Q: What energy source is the new electric boiler meant to replace, and how will it impact CO2 emissions? A: The electric boiler is primarily a replacement for LNG, aiming to reduce CO2 emissions. Borregaard has a flexible energy system, and the goal is to reduce LNG consumption by replacing it with electricity, which is the main source of CO2 emissions for the company. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
01-05-2025
- Business
- Yahoo
Borregaard ASA (STU:BO4) Q1 2025 Earnings Call Highlights: Record Revenues and Strong ...
Revenue: Operating revenues increased by 3% year-over-year, surpassing NOK2 billion for the first time in a single quarter. EBITDA: Increased by NOK69 million to NOK511 million, with a margin of 25.1%, up 2.7 percentage points from the previous year. Earnings Per Share: Increased to NOK2.52 from NOK2.01 in the first quarter of the previous year. BioSolutions EBITDA: Reached NOK349 million, an increase of NOK85 million from the previous year, driven by strong sales to agriculture. BioMaterials EBITDA: NOK113 million, slightly up from NOK111 million the previous year, despite lower sales volume and increased wood costs. Fine Chemicals EBITDA: Decreased to NOK49 million from NOK67 million, primarily due to lower bioethanol sales prices. Net Currency Effects: Positive impact of approximately NOK45 million compared to the previous year. Cash Flow from Operating Activities: NOK129 million, with investments totaling NOK143 million. Net Interest-Bearing Debt: Decreased by NOK114 million, with a leverage ratio of 1.09. Equity Ratio: 58% at the end of the first quarter. Warning! GuruFocus has detected 2 Warning Sign with SVNLF. Release Date: April 30, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Borregaard ASA (STU:BO4) reported an all-time high EBITDA of NOK511 million for the first quarter, driven by strong sales in the BioSolutions segment. The company experienced a significant increase in operating revenues, surpassing NOK2 billion for the first time in a single quarter. Strong sales to agriculture contributed to an 8% increase in operating revenues for BioSolutions compared to the first quarter of 2024. The EBITDA margin improved to 25.1%, which is 2.7 percentage points higher than the same quarter in 2024. Borregaard ASA (STU:BO4) benefited from positive net currency effects, contributing NOK45 million to the quarter's results. BioMaterials segment faced challenges with lower sales volume and increased wood costs, offsetting higher sales prices. Fine Chemicals segment experienced a decrease in operating revenues due to lower sales prices for bioethanol. The company is facing potential impacts from tariffs and trade wars, introducing uncertainty in the BioMaterials segment. Wood costs remain high, with no expected change in the second quarter, impacting overall cost management. Fine Chemicals segment's EBITDA margin decreased by 7.5 percentage points compared to the same quarter last year. Q: Can you give some more flavor on what is driving the strong uplift in profits for the agricultural products? Have you launched new products, hired new sales teams? Is demand from customers shifting? A: The strong uplift is primarily due to the green nature of our products, which are favorable in current market conditions, especially in biocontrol. Our products enable farmers to blend different products like fertilizers and pesticides, saving time and costs. We have also established an agricultural lab in Mumbai to continuously develop and improve our products. Q: Can you please help us understand what is behind the reported net FX EBITDA impact in 2025 estimated to be approximately plus NOK125 million versus 2024? A: The effect mainly comes from changes in hedging losses and currency rate movements. The strengthening of the Norwegian Kroner has reduced currency losses and the impact from currency rates, resulting in a lower net FX impact compared to what was reported after Q4. Q: For BioMaterials, how much visibility do you have on the remaining 115,000 tonnes you estimate will be delivered through 2025? A: We have multi-year volume-based contracts with annual and now semi-annual price negotiations. The construction market remains soft, affecting demand for ether grade products. However, other customer groups are more stable, and we are closely monitoring demand from the construction sector. Q: It seems like you have changed your price terms in BioMaterials from annual to semiannual negotiations. Can you explain why that is? A: The change to semiannual negotiations provides flexibility to adjust prices in response to abrupt cost changes, as seen during the COVID pandemic. This evolution allows both us and our customers to adapt to market conditions more effectively. Q: On BioSolutions, you mentioned a 2% price increase on average in sales currency. Is that a fair assumption for the remainder of the year? A: The 2% increase is primarily driven by product mix improvement rather than pricing changes. The pricing in sales currency is fairly flat, with the increase mainly due to a better product mix. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
21-04-2025
- Business
- Yahoo
Borregaard ASA (FRA:BO4) Q4 2024 Earnings Call Highlights: Record EBITDA and Strategic ...
EBITDA (Q4 2024): NOK398 million, up from NOK327 million in Q4 2023. Full Year EBITDA (2024): NOK1,874 million, compared to NOK1,781 million in 2023. Return on Capital Employed (2024): 17.1%, down from 18.3% in 2023. Dividend Proposal (2024): NOK4.25 per share, a 13% increase from last year, representing 52% of net earnings. BioSolutions Sales Volume (Q4 2024): Increased by 7%. BioMaterials Sales Volume (Full Year 2024): 160,000 tons, 11% higher than 2023. Fine Chemicals Sales (Q4 2024): NOK138 million, lower than historical context. Operating Revenues (Q4 2024): 9% higher than Q4 2023. EBITDA Margin (Q4 2024): 22.8%, 2.4 percentage points above Q4 2023. Earnings Per Share (Q4 2024): NOK1.30, up from NOK1.20 in Q4 2023. Full Year Operating Revenues (2024): NOK7.6 billion, a 7% increase from 2023. BioSolutions EBITDA (Q4 2024): NOK251 million, NOK79 million above Q4 2023. BioMaterials EBITDA (Full Year 2024): NOK434 million, compared to NOK534 million in 2023. Fine Chemicals EBITDA (Full Year 2024): NOK336 million, slightly above 2023. Cash Flow from Operating Activities (Q4 2024): NOK314 million. Investments (Full Year 2024): NOK861 million. Net Interest-Bearing Debt (End of 2024): Increased by NOK449 million. Equity Ratio (End of 2024): 53%. Leverage Ratio (End of 2024): 1.20. Warning! GuruFocus has detected 1 Warning Sign with BOM:533519. Release Date: January 29, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Borregaard ASA (FRA:BO4) achieved an all-time high EBITDA of NOK1,874 million for the full year, driven by increased specialization and strong results in BioSolutions. The company reported a 9% increase in operating revenues for the fourth quarter compared to the same period in 2023, mainly due to higher sales. BioSolutions segment saw a 7% increase in volume in the fourth quarter, with strong sales into agriculture, contributing to a robust performance. The Board proposed a 13% increase in dividends to NOK4.25 per share, reflecting a commitment to stable and progressive dividends. Borregaard ASA (FRA:BO4) is investing in environmental projects, such as the air preheater technology, which will reduce CO2 emissions by 7,000 tons and improve energy efficiency. Higher wood costs offset the positive results in BioMaterials, impacting overall profitability. Fine Chemicals segment experienced low deliveries in the fourth quarter, resulting in lower operating revenues compared to historical levels. The company's return on capital employed decreased to 17.1% from 18.3% in the previous year. Depreciation increased due to higher investments and leased assets, impacting earnings per share. The net currency impact was slightly negative for the full year, affecting overall financial performance. Q: Why was there no significant release in net working capital in Q4 2024, given it was the weakest movement since 2018? A: Per Lyngstad, Chief Financial Officer: The strong sales and production towards the end of the year increased inventories, which affected net working capital. Despite this, the average net working capital decreased for the year, indicating normal fluctuations within expected ranges. Q: What caused the increase in depreciation, and is it a permanent change? A: Per Lyngstad, Chief Financial Officer: The increase is due to higher investments and increased depreciation on leased assets, including storage. While depreciation related to leasing may decrease over time, increased investments will continue to raise depreciation levels. Q: How has Borregaard managed to keep wood costs stable despite rising commodity prices? A: Per Sorlie, President, Chief Executive Officer: Borregaard sources wood from a mix of geographies and types, including wood chips and pulpwood. Logistics costs, which account for about 25% of wood costs, also play a significant role in maintaining stable costs. Q: Will the sales prices for Borregaard's bioethanol in 2025 be similar to 2022 levels, and how will this affect EBITDA? A: Per Sorlie, President, Chief Executive Officer: While prices may align with 2022 levels, other factors like volume growth in Fine Chemical intermediates and bioethanol will positively impact EBITDA, making direct comparisons to 2022 challenging. Q: Why is Borregaard guiding for only 1% volume growth in BioSolutions for 2025 despite strong growth in 2024? A: Per Sorlie, President, Chief Executive Officer: The focus remains on improving the product mix and increasing sales of specialties, which drive profitability more than overall volume growth. The 2025 guidance reflects a normalized supply level. Q: How will the new investment impact LNG consumption? A: Knut-Harald Bakke, Director of Investor Relations: The investment will further reduce Borregaard's dependency on LNG, which has already decreased significantly since the energy crisis in 2022-2023. Increased electricity contracts will also contribute to reduced LNG consumption. Q: What triggered the NOK30 million environmental provision in Q4, and are all environmental liabilities covered? A: Per Lyngstad, Chief Financial Officer: The provision addresses legacy issues from a former mercury-based chlor-alkali plant. While not all liabilities are fully covered, Borregaard has made provisions based on current estimates and continues to monitor environmental issues. Q: What are the main drivers behind the increasing wood prices, and will this trend reverse in 2025? A: Per Sorlie, President, Chief Executive Officer: Factors include reduced wood supply due to the Russian invasion of Ukraine and sustainability pressures. While Borregaard can manage these costs, the trend's reversal depends on global demand and supply dynamics. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. 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