Diversified portfolio of products, operations in Brazil and abroad lead Braskem to a good result in 2022

Rhea-AI Summary

Braskem S.A. (NYSE: BAK) reported its 4Q22 earnings, highlighting a significant decline in financial performance. The company recorded a negative Recurring EBITDA of US$32 million, with a full-year EBITDA of US$2.1 billion, down 64% from 2021. Lower demand for petrochemical products, influenced by global market conditions and increased supply, contributed to the downturn. In 2022, Braskem faced a net loss of R$336 million. Despite this, the company maintained a cash position of US$2.4 billion, ensuring financial stability for the next five years. The earnings call is scheduled for March 23, 2023, at 10:00 a.m. ET.

Positive

• Cash generation in 4Q22 was R$922 million and R$6.0 billion for the year.
• Cash position is strong at US$2.4 billion, covering liabilities over the next 60 months.
• Recurring cash generation remained positive despite operational challenges.

Negative

• 4Q22 Recurring EBITDA was negative at US$32 million, a decline from previous quarters.
• 2022 Recurring EBITDA decreased by 64% to US$2.1 billion.
• Net loss for the year was R$336 million, indicating ongoing financial difficulties.
• Lower demand for petrochemical products affected sales volume significantly.

Registered Recurring EBITDA was R$10.6 billion and cash generation was R$3.3 billion

SÃO PAULO, March 23, 2023 /PRNewswire/ -- BRASKEM S.A. (B3: BRKM3, BRKM5 and BRKM6; NYSE: BAK; LATIBEX: XBRK) the largest resin producer in the Americas and the world's leading biopolymers producer, presents its 4Q22 Earnings Release.

4Q22 HIGHLIGHTS

CONSOLIDATED

• During the fourth quarter of 2022, petrochemical and chemical products spreads in the international market continued to be impacted by the dynamics between global supply and demand. Several factors contributed to the lower demand in the period, including (i) the "zero-COVID" policy measures impacting China's growth; and (ii) the uncertainties of the scenario in the United States and Europe. Additionally, the increase in products supply with the new PE and PP capacities coming online in the United States and in China also contributed to decline the petrochemical and chemical spreads in the international market.
• In this scenario, the Company's Recurring EBITDA in 4Q22 was negative in US$32 million (-R$168 million), a decrease from 3Q22 and 4Q21, mainly explained by (i) the lower international spreads for PE, PP, PVC and main chemicals in Brazil, for PP in the United States and Europe and for PE in Mexico; (ii) the lower sales volume of resins and main chemicals in the Brazil segment, of PP in Europe and of PE in the Mexico segment; (iii) the seasonal restatement of provisions, with no impact on cash generation, in the amount of around R$248 million; and (iv) the 6% appreciation of the Brazilian real against the U.S. dollar between 4Q22 and 4Q21. These effects were partially offset by the higher sales volume of Green PE in the Brazil segment and PP in the United States.
• In 2022, the Company's Recurring EBITDA was US$2.1 billion, 64% lower than 2021, due to (i) the lower international spreads for PE, PP and PVC in Brazil, for PP in the United States and Europe and for PE in Mexico; (ii) the lower sales volume of main chemicals in the Brazil segment and of PP in the United States and Europe segment; and (iii) the accounting effect of realization of inventories¹ in the net amount of US$84 million (R$435 million). In Brazilian real, Recurring EBITDA was R$10.6 billion, a decrease of 65% from 2021, due to the 4% appreciation in the Brazilian real against the U.S. dollar.
• In the quarter, the Company registered a net loss² of R$1.7 billion, and in the year, the Company registered a net loss attributable to shareholders of R$336 million.
• Recurring cash generation was R$922 million and return³ on cash flow was 33% in 4Q22. Considering the payments related to the geological event in Alagoas made in 4Q22, the Company registered cash generation of R$155 million and return3 on cash flow of 18%. In the year, the Company's recurring cash generation was R$6.0 billion, and considering the payments related to the geological event in Alagoas, cash generation was R$3.3 billion.
• The cash position was of US$2.4 billion, a level that guarantees the coverage of liabilities coming due over the next 60 months. Note that this position does not include the international stand-by credit facility in the amount of US$1.0 billion, with maturity in 2026.
• Thus, Corporate leverage, measured by the ratio of adjusted net debt to Recurring EBITDA⁴ in U.S. dollar, remained healthy, ending the year at 2.42x.

The full earnings release is available on the Company's IR website: www.braskem-ri.com.br/home-en

Braskem will host conference calls to discuss its Results THURSDAY, March 23 at 10:00 a.m. US ET.

Additional information may be obtained from the Investor Relations Department at +55 11 3576-9531 or braskem-ri@braskem.com.br.

 

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SOURCE Braskem S.A.

FAQ

What were Braskem's earnings for 4Q22?

Braskem reported a negative Recurring EBITDA of US$32 million for 4Q22.

How did Braskem perform financially in 2022?

Braskem's Recurring EBITDA for 2022 was US$2.1 billion, down 64% from 2021.

What is Braskem's cash generation in 4Q22?

Braskem generated R$922 million in cash during 4Q22.

What was Braskem's net loss in 2022?

Braskem recorded a net loss of R$336 million attributable to shareholders in 2022.

What is Braskem's cash position as of 4Q22?

Braskem has a cash position of US$2.4 billion, sufficient to cover liabilities due in the next 60 months.