Arkema Reports First Quarter 2023 Results

In an environment in the continuity of the end of last year, marked by continued low volumes, the Arkema Group achieved a solid financial performance in the first quarter, in line with its full-year guidance for 2023.

Sales were €2.5 billion, down by 12.6% year-on-year. Volumes were down, impacted by continued weak demand in Europe, a slowdown observed in construction in the United States, and temporary destocking in batteries in China.

There was overall resilience in prices, benefiting from the work to position the portfolio on higher value-added solutions, and benefits of Arkema’s sustainable innovation in high performance solutions such as bio-based and recyclable materials, 3D printing and more eco-friendly coatings

EBITDA was €367 million and EBITDA margin was 14.5%, down compared with the exceptionally high comparison base of Q1’22 (€619 million and 21.4%, respectively), which benefited from particularly favorable market conditions in PVDF and upstream acrylics. Adjusted net income was €162 million, representing €2.17 per share (€5.08 in Q1’22).

Following Arkema’s Board of Directors’ meeting, held on 4 May 2023 to review the group’s consolidated financial information for the first quarter of 2023, Chairman and CEO Thierry Le Hénaff said:

“The quarter’s performance was achieved, as expected, in a general context of weaker demand, more particularly in Europe and in the construction market,” chairman and CEO Thierry Le Hénaff said. “The visibility expressed by our customers remains limited despite some more positive initial signals observed in Asia. In this economic environment that remains difficult, the group achieved, thanks to its positioning and agility, solid results in the first quarter, and confirms its EBITDA and cash flow forecast for the year. Arkema will moreover remain attentive to strictly managing its costs and working capital.

“The beginning of 2023 was also marked by two key milestones in the implementation of Arkema’s ambition in sustainable solutions: the launch of the final phase in the start-up of the bio-based polymer plant in Singapore, and SBTi validation for our 1.5°C carbon trajectory by 2030,” added Le Hénaff. “In addition, several major industrial projects are progressing as planned and will soon contribute to the group’s growth in Specialty Materials.”

At the beginning of the second quarter, the macroeconomic context remains marked by a lack of visibility and continued low volumes. The outlook should be contrasted by region for the coming months, Europe remaining weak, the United States down but holding up better overall and Asia improving slightly from a low level.

Raw material costs are sequentially showing signs of easing tightness but broadly remain at elevated levels in Europe and the United States, and energy prices are declining while remaining relatively high in Europe.

In this context, the group will continue to work on two levels: firstly, tightly managing its operations with in particular a strong emphasis on cost control, the optimization of working capital and the environmental performance of its sites. Then, the implementation of its projects to develop sustainable solutions by continuing the dynamic of growth-driven industrial investments and the acceleration of targeted innovation in new energies, 3D printing, bio-based and recyclable materials, and new mobility.