A solid start into 2019

A leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers, Borealis, announced a net profit of 200 million euros for the first quarter of 2019, compared to 240 million euros in the same quarter of 2018. The deterioration in profit compared to the first quarter of 2018 was driven by lower European integrated polyolefin margins than in the same period of 2018. Additionally, the contribution from Borouge in the first quarter of 2019 was below the same period in 2018, mainly due to the Borouge 3 turnaround and weaker polyolefin sales prices in Asia.

In the first quarter, net debt increased by 429 million euros, largely due to the payment of a 400 million euros final dividend payment over 2018 to Borealis' shareholders. In September 2018 a 300 million euros interim dividend was already paid for 2018. A second main factor leading to the increased debt position was the implementation of the new accounting standard for lease contracts (IFRS 16) impacting the reported debt by 210 million euros. The cash inflow from the solid business result and dividends from Borouge allowed Borealis’ financial position to remain strong, with a gearing of 28% at the end of the first quarter of 2019.

“While the European integrated polyolefins industry margin remained firm in the first quarter of 2019, the outlook on the full year remains uncertain, being driven by the looming risk of an economic slowdown as well as increased geopolitical uncertainty”, commented Alfred Stern, Borealis CEO. “The Borouge result in the first quarter was solid, but was of course impacted by the Borouge 3 turnaround. The continued strong financial performance delivered last year and Borealis’ excellent financial position has enabled us to pay a total dividend of EUR 700 million to our shareholders for the business year 2018”.