The Top ten chemical companies of 2014

15-21 September 2014 | ICIS Chemical Business | 27www.icis.com

SPECIAL REPORT TOP 100 ANALYSIS

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Economic challenges continued to impact chemical companies in all regions in 2013. This year, the US shale gas boom takes centre stage as construction gets started

ICIS Top 100 regions Regional leaders faced tough trading

conditions in 2013 as the global economy continued to sputter. Stronger economic performance in

the US was offset by contraction in Europe and slower growth in Asia.

Since then, European chemical companies have become sharply focused on improving their competitive position, especially in com-modities where consolidation is ongoing.

Meanwhile, the US race for shale gas con-tinues, with a building programme that will see new capacity on stream in 2017-2018. ■

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2013 WAS a solid year for both sales and profit gains for the top 10 chemical companies based in North America as the US economy continued its recovery, although at a slow and steady pace. Producers with petrochemical as-sets in the US also benefited from the shale gas boom as natural gas liquids (NGL) feedstock costs remained low.

On the top line, PPG Industries and Ecolab showed notable rev-enue gains of nearly 12% each, aided by mergers and acquisitions (M&A). The bottom line was even better as earnings surged 38% for both PPG and Ecolab.

Coatings giant PPG Industries received a boost from the acquisi-tion of AkzoNobel’s North American architectural coatings business but also saw higher organic sales growth in 2013, propelling it from the #6 slot in 2012, to #5 for 2013 with $15.1bn in sales. Expect even higher sales and earnings growth from PPG in 2014 and beyond. In June 2014, it agreed to buy Mexico-based coatings company Comex for $2.3bn. Comex has annual sales of around $1bn.

Ecolab, which specialises in in-stitutional cleaning, water treat-ment and oilfield chemicals, booked $13.3bn in sales in 2013, also moving up a notch to the #6 position on the leaderboard.

Ecolab acquired US-based oil-field chemicals company Champion Technologies for $2.3bn in April

2013, tacking on around $1.3bn in annual sales.

Coatings company Sherwin-Williams made its way into the Top 10 with a 6.8% sales gain to $10.2bn for 2013, also aided by acquisitions, while earnings rose by 19%.

Looking ahead, there are two

diverging trends. On the growth side, three of the top 10 – ExxonMobil Chemical, Dow Chemical and Chevron Phillips Chemical and are building major petrochemical and derivatives pro-jects, primarily on the US Gulf Coast to take advantage of shale gas economics. That will add to

revenues, but mostly starting in 2017-2018.

Also on the growth side, compa-nies such as PPG Industries, Sherwin-Williams and Ecolab are still seeking growth through M&A, boding well for future moves up the rankings. Huntsman will get a big boost if it is able to complete its planned $1.1bn acquisition of Rockwood Holdings’ titanium diox-ide (TiO2) and performance addi-tives business. The acquisition has been awaiting European Commission approval.

On the other side of the equa-tion, companies such as DuPont and Dow Chemical are seeking to trim their portfolios – Dow through sales of non-core assets and the separation of its chlorine and de-rivatives business, and DuPont through the separation of its perfor-mance chemicals segment, which consists mostly of TiO2. These moves could impact sales signifi-cantly in the years to come. ■

NORTH AMERICA JOSEPH CHANG NEW YORK

NORTH AMERICA TOP 10 LIFTED BY ECONOMY, SHALE GAS, M&A

NORTH AMERICA TOP 10 LEADERS, $M

Rank Company Sales Operating profit Net profit

2013% change

(reporting currency) 2013 2012 2013 2012

1 ExxonMobil 59,273 -2.6 5,180 4,885 3,828 3,898

2 Dow Chemical 57,080 0.5 6,804 1,665 4,447 842

3 DuPont 35,734 2.6 3,489 3,088 4,862 2,780

4 Agrium 15,727 -1.9 1,630 2,216 1,063 1,498

5 PPG Industries 15,108 11.8 1,489 1,057 1,156 836

6 Ecolab 13,253 11.9 1,561 1,289 968 704

7 Chevron Phillips Chemical 13,147 -0.7 - - 2,743 2,403

8 Praxair 11,925 6.2 2,625 2,437 1,755 1,692

9 Huntsman 10,847 -1.1 510 845 128 363

10 Sherwin-Williams 10,186 6.8 1,086 907 753 631

NOTE: Please refer to main Top 100 listing (published 8 September) for footnotes.

Companies such as PPG Industries, Sherwin-Williams and Ecolab are still seeking growth through M&A, bodingwell for future movesup the rankings

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www.icis.com 15-21 September 2014 | ICIS Chemical Business | 29

EUROPE WILL BEACHAM LONDON

COMMODITY CONSOLIDATION BECOMES A KEY THEME FOR EUROPE

EUROPE TOP 10 LEADERS, $M

Sales Operating profit and EBIT Net profit

Rank Company 2013% change


1 BASF 101,906 2.6 10,019 8,889 6670 6354

2 LyondellBasell Industries 44,062 -2.8 5,102 4,676 3857 2848

3 Shell 42,279 -7.6 - - 1843 1374

4 Bayer 29,251 0.5 2,306 2,272 - -

5 INEOS 27,864 -10.8 - - - -

6 Total 25,743 1.4 - - - -

7 Linde Group 22,944 5.2 2,991 2,709 1814 1624

8 Air Liquide 20,974 -0.7 3,591 3,330 2347 2185

9 AkzoNobel 20,099 -5.2 1,320 1,197 911 676

10 Johnson Matthey 18,598 4.0 747 581 565 412

NOTE: Please refer to main Top 100 listing (published 8 September) for footnotes


THE TOP 10 European leaders ta-ble is only slightly reshuffled from the previous year. Unsurprisingly BASF retains its top position with more than double the sales of its nearest rival, LyondellBasell, which swapped places with Shell to reach second place. Bayer swapped with INEOS to reach fourth place.

The year 2013 was a tough one for the global economy, which grew at only 2.3% compared with 2.5% the previous year while Europe continued to be plagued by GDP contraction in many countries. The EU region only achieved 0.1% growth during the year, though this was a slight improvement on the previous year’s contraction of 0.3%. This impacted chemical companies headquartered in Europe, many of which suffered declines in sales revenues. However the slight improvement in demand in Europe did allow all the companies in the top 10 to report improved operating earnings and net profits compared to 2012’s depressed levels.

During 2014 several of the top players have become very fo-cussed on major strategic moves to either exit or beef up and im-prove the competitive position in some of their commodities.

In June INEOS announced it is to acquire an additional 50% stake in styrenics producer Styrolution from joint venture partner BASF for €1.1bn. The deal – which is ex-

pected to close in the fourth quar-ter of 2014 – will give INEOS full control of this global styrenics leader. For BASF this is another step away from commodities as it tries to focus on value-added ad-vanced materials.

INEOS also signed a deal with Belgium’s Solvay to put their European chlor vinyls activities into a JV – to be known as INOVYN. The deal was given clearance by the European Commission in May 2014 though the remedy package has yet to be divested. INEOS has to sell assets in Tessenderlo

(Belgium), Mazingarbe (France), Beek (The Netherlands), Wilhelmshaven (Germany) and Runcorn (UK).

These moves are signs of the European chemical sector’s in-creasing preoccupation with the threat to its competitive position posed by the US shale gas revolu-tion. This has cut energy and feed-stock prices hugely in the US whilst Europeans struggle with high energy costs and taxation as well as a reliance on naphtha-based feedstocks.

Just in the last few weeks other

companies have joined INEOS in seeking to import US ethane as a way of grabbing some of the US advantage. INEOS – as ever the trailblazer – was first to announce the construction of ethane import terminals at Rafnes in Norway and Grangemouth in Scotland. These facilities are now approved and under construction. Next Borealis – the other company with European gas crackers – an-nounced a similar construction project plus a cracker upgrade scheme for its Stenungsund, Norway, facility.

In August SABIC revealed plans to modify its cracker in Teesside in the UK so it can use ethane. The company plans to complete the project in 2016. India’s Reliance also announced a scheme to im-port 1.5m tonnes/year of US ethane for ethylene cracking in India.

Dutch-headquartered LyondellBasell is grabbing the US shale advantage too. In August it announced plans to develop a world-scale propylene oxide (PO) and tertiary butyl alcohol (TBA) plant on the US Gulf coast. Slated to be operation by 2019, the unit will have an estimated capacity of over 400,000 tonnes/year of PO and over 900,000 tonnes/year of TBA and its derivatives.

This is on top of three US ethylene expansions it has announced which will add over 800,000 tonnes/year of production capacity. ■

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www.icis.com30 | ICIS Chemical Business | 15-21 September 2014

SPECIAL REPORT ICIS TOP 100 ANALYSIS

ASIAN CHEMICAL companies man-aged to hold their positions in the ICIS global top 10, with a few excep-tions, despite facing a difficult year.

With sales of $72.2bn, Sinopec, China’s state-owned refining and petrochemicals major, held on to the #2 position on the global list. But the major faced difficult condi-tions in its home market with in-tense competition from low-cost imports and entry of new local com-petitors. Operating profit for the chemicals segment declined to yuan (CNY) 868m from CNY1,172m in 2012. To overcome this threat Sinopec has focused on optimising its feedstock and prod-uct mix to increase the share of value-added products.

Ethylene production increased 5.58% to 9.98m tonnes last year while synthetic resins output was up 2.87% at 13.726m tonnes. For 2014, the company aims to pro-duce 10.58m tonnes of ethylene. It also expects to complete a coal-to-chemicals project at Ningdong.

Mitsubishi, the second-largest chemicals company in Asia, saw strong sales growth in the petro-chemicals and chemicals derivative segment in fiscal 2013-14 with the company managing to push through price hikes. Even in the purified terephthalic acid (PTA) business where the Asian market is reeling under overcapacity, Mitsubishi was able to boost numbers due to strong sales in India and deprecia-tion of the yen.

But Mitsubishi continues to re-structure its chemicals business. It is currently implementing an agree-ment signed with Asahi Kasei to unify cracker operations at the Mizushima site in Japan in order to optimize product configuration, in-crease efficiency, strengthen com-petitiveness and boost profitability.

Other Japanese chemical com-panies too enjoyed healthy growth in sales and profits last year. Sumitomo Chemical, ranked at #4 on the Asia list, posted 15% growth in sales supported by high-er product prices and depreciation of the yen.

Mitsui Chemicals posted 11.4% growth in sales in 2013-14 despite volatile market conditions in phe-nol, PTA and toluene diisocynate (TDI) businesses which were hit by weak demand in China and over-supply. Mitsui has embarked on an

aggressive restructuring pro-gramme for these businesses that includes closure of a 90,000 tonnes/year bisphenol-A (BPA) plant in Chiba, Japan, in March 2014 and suspension of 70,000 tonnes/year of BPA production in Singapore.

It also plans to close a 250,000 tonnes/year phenol plant and a 60,000 tonnes/year linear low den-sity polyethylene (LLDPE) unit, both at Chiba, in September and December respectively.

Among the other Asian chemical companies, Thai major PTT Global Chemicals (PTTGC) faced many internal and external challenges last year, which resulted in a 2% drop in sales in 2013.

PTTGC’s 300,000 tonne/year LDPE plant in Map Ta Phut was shut for more than three months to ad-dress a technical problem at the

unit. Meanwhile, an outage at the gas separation plant (GSP) No 5 of PTT, the parent firm of PTTGC, be-cause of a lightning strike in August, prompted PTTGC to run some of its plants at reduced capacity.

In addition, 2013 was also the first full year that a new price for-mula for feedstock gas to its olefins and derivative business was ap-plied. According to the company, the new formula aims at providing a fairer profit sharing between PTTGC and its parent.

Indian refining and petrochemi-cal major Reliance Industries climbed to #23 on the global list thanks to 10.5% growth in sales during 2013-14. Surging export sales, a strong performance in re-fining and higher petrochemicals margins also drove up profits.

Petrochemicals sales rose 9.5% year over year to $16.1bn, with growth led by an 8.6% increase in prices while volumes grew 0.9%. Earnings in the petrochemicals business was supported by strong margins in polymers and polyester, which partly offset the weak margin seen in fibre intermediates such as PTA.

Most Asian chemical companies saw an improvement in their busi-ness environment in 2013 and ex-pect this to continue in 2014. While signs of improvement in margins and profitability are evident, the risks cannot be ignored. These in-clude high feedstock costs and an uncertain Chinese economy. ■

ASIA MALINI HARIHARAN MUMBAI

ASIAN TOP 10 CHEMICAL COMPANIES OVERCOME CHALLENGING YEAR

ASIA TOP 10 LEADERS, $M

Sales Operating profit Net profit



1 Sinopec 72,281 6.2 143 189 - -

2 Mitsubishi Chemical 33,961 13.3 1,072 958 313 197

3 LG Chem 21,920 -0.5 1,651 1,793 1,203 1,414

4 Sumitomo Chemical 21,779 14.9 980 478 359 -542

5 Toray 17,838 15.4 1,022 886 579 515

6 PTT Global Chemical Public Co. Ltd. 16,787 -2.4 1,064 1,172 1,017 1,111

7 Reliance Industries 16,074 10.5 1,399 1,319 - -

8 Lotte Chemical Corp 15,570 3.4 462 349 271 297

9 Mitsui Chemicals 15,200 11.4 242 46 -244 -86

10 Formosa Chemicals & Fibre (Taiwan) 14,331 9.4 635 109 832 252


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SAUDI ARABIA’S SABIC continues to be by far the largest chemical player in the Middle East and Africa region, with sales nearly five times that of nearest challenger, South Africa’s Sasol. SABIC’s turnover for 2013 of Saudi riyal (SR) 189bn ($50.4bn) was, however flat, showing no change on the 2012 figure due to the challenging market conditions especially in developed economies. Nevertheless, it retained its overall global position of fifth place, after BASF, Sinopec, ExxonMobil Chemical and Dow Chemical.

SABIC’s earnings improved slight-ly in 2013, with net income advanc-ing 2% to SR25.3bn. SABIC described the year as one of “solid performance... despite continued challenges in the global economy.” It has, it added, “beaten the market average on improved efficiency and strong performance in key sectors.”

Looking forward, vice chairman and CEO Mohamed Al-Mady noted that: “The global chemical sector has turned the corner, with sales volumes starting to stabilise and even pick up. We believe the sec-tor will see better growth, with demand outpacing capacity for the next three years or so.”

Fellow Saudi Arabian producer Tasnee, in sixth spot with sales of $4.9bn, also struggled to grow rev-enue, with sales up just 1.6% in local currency terms.

The big change in the Middle

East and Africa ranking this year has been the disappearance of Iran’s state-owned NPC. With sales of $9bn in 2012 this ranked third last year in the regional table and 50th in global terms. Privatisation of the oil and chemicals sector in the country has created three new players that rank in the table this year: Persian Gulf Petrochemical Industry, Parsian Oil & Gas Development and TAPPICO, in third, fifth and seventh place, pushing out Kuwait’s PIC and South Africa’s AECI from the bottom of the table.

Abbas Sha’ri Moghadam, Iran’s

deputy petroleum minister and presi-dent of NPC, said at the recent 11th International Iran Petrochemical Forum in Tehran that NPC, which operates under Iranian Petroleum Ministry, has undergone a vast trans-formation. As a holding company, it used to have more than 50 produc-tion and service companies, but it has now privatised most of these.

The only state-run units at NPC are now R&D, the Mahshahr Special Economic Zone and the $4bn Damavand petrochemical project.

NPC will continue to functioning as a company with governance and

development tasks, he added. The firm is to provide the required infra-structure and incentives for invest-ment in petrochemicals.

In Israel, ICL and Makhteshim-Agan, now known as Adama Agricultural Solutions, had diverse fortunes, with ICL seeing sales down 3.1% in local currency terms to $6.3bn, and Adama enjoying an increase of 8.5%, to $3.1bn.

Adama reported a year of solid growth in sales and earnings de-spite an unfavourable currency envi-ronment especially in its Asia-Pacific region and Brazil. It achieved growth across all regions; higher sales vol-umes and an improved product mix that led to improvement in financial performance. The results in Latin America benefited from positive market conditions in the region.

At ICL, lower selling prices were noted as primarily being behind the sales slide. The company is looking to save several hundred million dollars by 2016. The initiative is critical, it says, “under the current climate of weak markets, increased competition in the markets and an unstable business environment”.

In South Africa, Sasol saw sales rise 11% in 2013, but earnings were down substantially due in large part to issues in the polymers business. The company has now withdrawn fully from its joint venture operations in Iran, Arya Sasol Polymer, which resulted in an impairment charge against operat-ing profit of rand 3.6bn ($340m). ■

SPECIAL REPORT ICIS TOP 100 CHEMICAL COMPANIES

MIDDLE EAST AND AFRICA JOHN BAKER LONDON

THREE IRAN COMPANIES MAKE TOP 10 LISTING DEBUT

MIDDLE EAST AND AFRICA TOP 10 LEADERS, $M

Sales Operating profit and EBIT Net profit



1 SABIC 50,403 0.0 11,355 10,938 6,740 6,606

2 Sasol* 10,658 11 194 795 - -

3 Persian Gulf Petrochemical Industry 8,117 - 1,442 735 722 225

4 ICL 6,272 -3.1 1,101 1,554 820 1,302

5 Parsian Oil & Gas Development 5,098 - 1,812 1,844 1,737 1,586

6 Tasnee 4,853 1.6 823 1,098 314 470

7 TAPPICO 3,796 - 1,703 1,180 1,668 1,018

8 Makhteshim-Agan Industries 3,076 8.5 309 282 127 123

9 Industries Qatar 3,066 6.7 - - - -

10 Petro Rabigh 2,062 -18 - - - -

* Financial year ended 30 June 2013. NOTE: Please refer to main Top 100 listing (published 8 September) for footnotes

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LATIN AMERICA JOSEPH CHANG NEW YORK

LATIN AMERICA CHEMICAL LEADERS POISED FOR CHANGES

LATIN AMERICA TOP 5 LEADERS, $M

Sales Operating profit Net profit

Rank Company 2013% Change


1 Braskem 17,345 13.3 1,160 777 215 -360

2 Alpek 6,875 -6.3 223 577 69 338

3 Mexichem 5,177 8.6 562 642 83 962

4 Pemex 3,081 14.0 -1,164 -806 -1,140 -869

5 SQM 2,203 -9.3 652 901 475 657


SPECIAL REPORT ICIS TOP 100 ANALYSIS

THERE WAS no change among the Latin America-based chemical lead-ers in 2013, as the top five compa-nies maintained their positions. However, climbing fast in the rank-ings is polyvinyl chloride (PVC) pro-ducer Mexichem, which continues to build its empire through mergers and acquisitions (M&A).

The #3 player, Mexichem, which reports its financials in US dollars, saw 2013 sales gain 8.6% to $5.2bn. The top line benefited from its May 2013 acquisition of US-based PolyOne’s vinyl assets for $250m, adding $147m in an-nual sales, along with its June 2012 buyout of Netherlands-based polymer pipe manufacturer Wavin for €531m.

Mexichem is poised to advance further with two major deals signed in August. The company is buying US-based polyethylene (PE) pipe and conduit producer Dura-Line for $630m, adding around $650m in annual sales in a deal expected to close in the third quar-ter of 2014.

Mexichem also plans to acquire Germany-based specialty PVC pro-ducer Vestolit in a €219m deal. That deal, which would add sales of around €477m, is expected to close in the fourth quarter of 2014.

If the two deals go through, Mexichem could boost annual sales by over $1.2bn in 2015.

Brazil’s Braskem, the leading Latin America player, saw sales in local currency rise 13.3%. Yet in US dollar terms, sales actually fell

1.7% to $17.3bn on the severe decline in the Brazilian real.

In the years ahead, Braskem’s sales should increase on the con-struction of its Ethylene XXI project in Mexico being built by Braskem Idesa – a 75:25 joint venture be-

tween Braskem and Mexico’s Grupo Idesa.

The Ethylene XXI project, slated to start up by July 2015, will consist of an ethane cracker with 1.05m tonnes/year of ethylene capacity, along with derivative PE plants with equivalent capacity.

Mexichem is also working on two major projects. The first involves upgrading the vinyl chloride mono-mer (VCM) plant at its majority owned joint venture with Pemex in stages ending in 2015.

The other is a 50:50 joint ven-ture cracker in Ingleside, Texas, US with partner Occidental Chemical. That project, scheduled to be com-pleted in the first quarter of 2017, will add 544,000 tonnes/year of ethylene capacity, which will ulti-mately be used to produce VCM at an existing facility on site. The VCM would be shipped to Mexichem’s PVC plants in Mexico.

Mexico’s energy reform signed into law in August 2014 allowing for private and foreign investment in the energy, refining and petrochemi-cal sectors also bodes well for growth. State-owned energy com-pany Pemex could see its petro-chemical sales rise significantly in the years ahead. ■

In the years ahead, Braskem’s salesshould increase onthe construction ofits Ethylene XXIproject in Mexico

Mexico’s energy reform allows for private and foreign investment in the energy, refining and petrochemical sectors

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