Belgian chemicals and plastics producer Solvay (Brussels; www.solvay.com) has reported a rise of nearly 10% in REBITDA for Q3 2014 on the back of 8% higher net sales of EUR 2.6 bn. The performance was driven by a 5% increase in volumes – more than 10% respectively for the Advanced Formulations and Advanced Materials segments – along with stable pricing. The group REBITDA margin on net sales improved by 26 basis points to 17.7%.

The net result from discontinued businesses, including the European chlorovinyls activities brought into Indovyn, a joint venture with Ineos and no longer consolidated – see Plasteurope.com of 26.06.2014 – came to EUR 23m, up from EUR 20m a year ago.

In breaking news, Solvay said it is “awaiting details” of the decision by the Brazilian competition authority on 13 November to reject its sale of the 70.59% majority stake in Solvay Indupa to petrochemicals giant Braskem – see Plasteurope.com of 07.07.2014. Despite the setback, the Belgian group said “its strategic direction remains unaffected.” Alternatively, it plans to “examine alternative options” to sell the subsidiary, South America’s second largest PVC producer and fourth-largest caustic soda producer, to another buyer.

Commenting on Q4 results, CEO Jean-Pierre Clamadieu attributed the “robust earnings performance so far this year” to the benefits of the ongoing transformation and portfolio reshaping process and confirmed an earlier forecast of “high single-digit REBITDA for the full year". Despite “uncertain and challenging” macro-economic conditions, the CEO said Solvay is “well positioned” to grow its earnings year-on-year in the fourth quarter.

Led by "Advanced Formulations" and "Advanced Materials", all of the group’s business segments contributed to the Q3 REBITDA rise. Advanced Materials, which includes the "Speciality Polymers" unit, lifted its sales by 14% year-on-year, thanks to a “robust” performance underpinned by strong volume growth and operational efficiency. Propelling growth were new product launches of smart devices, innovation in the automotive sector and higher demand from the oil and gas industry.

In Functional Polymers, “positive pricing power” from raw material price reductions, growing demand for engineering plastics – mainly in Asia – and Solvay’s excellence programme bolstered business in polyamide, which now accounts for 97% of the segment’s revenue. Overall, sales of the segment declined by almost 8% year-on-year to EUR 394m, as demand for manmade fibres suffered from “poor macro-economic conditions” in Brazil. REBITDA gained 18% to reach EUR 21m. Here, the group’s profit restoration plan continued to focus on reducing costs and improving on commercial excellence.

Solvay continued to wind down its European chlorovinyls activities in the third quarter following the divestment of Benvic in the second quarter. The start of the RusVinyl PVC production in Russia weighed on REBITDA, due to start-up costs and depreciation of the rouble.

Reports not yet confirmed by management say Solvay is exploring the sale of its Acetow business, which supplies material for cigarette filters. A cash generator for the Belgian chemical producer, the business is said to have attracted the interest of private-equity buyers. Market speculation also has it that the polyamides business may soon be up for grabs.