Borealis: Records Solid Performance for 2008
Borealis AG, Vienna/Austria, completes 2008 with a net profit of EUR 239 million, down 55% from the record profit of 2007. The return on capital employed (ROCE) after tax was 9% this year, down from 22% the year before. Net interest-bearing debt increased by EUR 453 million during 2008, driven largely by Borealis’ ongoing growth investments. The gearing ratio increased from 27% in 2007 to 47% at year-end 2008. These solid results were achieved despite deteriorating market conditions, especially in the last quarter. The industry faced a dramatic rise in feedstock prices in the first half of the year, followed by a drop in prices during the fourth quarter. However fixed quarterly feedstock prices in the fourth quarter did not adequately reflect this movement and caused an imbalance with dropping polymer prices leading to a net loss of EUR 122 million in the fourth quarter. More than half of this loss was due to inventory impairment at year-end.
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