Orbia Announces Fourth Quarter and Full Year 2021 Financial Results

Rhea-AI Summary

Orbia Advance Corporation reported strong financial results for Q4 and FY 2021. Q4 net revenues reached $2.3 billion, marking a 34% increase. The company's EBITDA jumped 31% to $504 million, driven by high PVC prices and demand in Polymer Solutions. For the full year, revenues climbed 37% to $8.8 billion, with net majority income soaring 238% to $657 million. The firm maintained a robust balance sheet with a net debt-to-EBITDA ratio of 1.34x. Looking forward, Orbia anticipates moderate sales growth and projected EBITDA between $1.6 billion and $1.75 billion for 2022.

Positive

• Net revenues increased 37% for FY 2021 to $8.8 billion.
• EBITDA for FY 2021 grew 55% to $2.05 billion.
• Net majority income surged 238% YOY to $657 million.
• Cash returned to shareholders totaled $365 million, including dividends and share buybacks.
• Net debt-to-EBITDA ratio decreased to 1.34x.

Negative

• Financial costs increased 150% in Q4 2021, driven by FX losses.
• SG&A increased by 12% YOY for FY 2021.

MEXICO CITY--(BUSINESS WIRE)-- Orbia Advance Corporation, S.A.B. de C.V. (BMV: ORBIA*) (“the Company” or “Orbia”) today released audited results for the fourth quarter and full year of 2021.

Orbia achieved solid performance throughout 2021 driven by strong results in its Polymer Solutions and Building & Infrastructure businesses. During the fourth quarter, Polymer Solutions benefited from high PVC prices and robust global demand, while Data Communications, Fluorinated Solutions and Building & Infrastructure delivered top-line performance gains.

Q4 2021 Financial Highlights

(All metrics are compared to Q4 2020 unless otherwise noted)

• Net revenues of $2.3 billion increased 34%, with higher sales in all businesses except for Precision Agriculture
• EBITDA of $504 million increased 31%, driven mainly by higher profitability in Polymer Solutions
• Net majority income of $126 million increased 91%
• Free cash flow of $304 million remained flat

Full Year 2021 Financial Highlights

(All metrics are compared to FY 2020 unless otherwise noted)

• Net revenues of $8.8 billion increased 37%, mainly due to strength in Polymer Solutions and Building & Infrastructure
• EBITDA of $2.05 billion increased 55% driven by enhanced profitability in Polymer Solutions and Building & Infrastructure
• Net majority income of $657 million increased 238%
• Free cash flow of $572 million increased 4%
• Cash returned to shareholders of $365 million, with dividends and share buybacks of $199 million and $166 million, respectively
• Leverage ratio (net debt- to-EBITDA) decreased to 1.34x, due to the increase in EBITDA

“2021 was a year we can truly be proud of at Orbia. Our purpose to advance life around the world has been our compass through uncertain times and a global pandemic. Supported by our relentless focus on execution as well as organic gains in our businesses and acquisitions, we closed the year on a high note. We achieved record financial performance of $8.8 billion in revenues and $2.05 billion in EBITDA—results that simply wouldn’t have been possible without our 22,000 employees working with dedication and ingenuity to deliver value for our customers and shareholders,” said Sameer Bharadwaj, CEO of Orbia.

Bharadwaj continued, “Through the end of the year, we continued to experience strong demand across our five businesses and continued to invest in initiatives supporting our growth strategy. In addition, we were able to maintain a healthy balance sheet and return cash to our shareholders through dividends and share repurchases. Looking forward to 2022 and beyond, we are well-positioned to capture profitable growth opportunities across the Company in both the short and long-term.”

Q4 and Full Year 2021 Consolidated Financial Information¹

(All metrics are compared to Q4 and FY 2020 unless otherwise noted)

mm US$		Fourth Quarter						January - December
Financial Highlights		2021		2020		%Var.		2021		2020		%Var.
Net sales		2,339		1,742		34%		8,783		6,420		37%
SG&A		332		321		4%		1,178		1,048		12%
Operating income		345		201		72%		1,449		720		101%
EBITDA		504		383		31%		2,047		1,318		55%
EBITDA margin		21.5%		22.0%		-47 bps		23.3%		20.5%		277 bps
Financial cost		86		34		150%		297		242		23%
Earnings before tax		259		166		56%		1,154		479		141%
Income tax		109		69		58%		381		151		153%
Consolidated net income (loss)		151		96		57%		772		319		142%
Net majority income		126		66		91%		657		195		238%
Operating cash flow		450		390		15%		982		871		13%
Capital expenditures		(122)		(70)		74%		(311)		(228)		36%
Free cash flow		304		304		0%		572		552		4%
Net debt		2,738		2,751		0%		2,738		2,751		0%

1

Unless noted otherwise, all figures in this release are derived from the Consolidated Financial Statements of the Company as of December 31, 2021, and are prepared in accordance with International Accounting Standards 34 “Interim Financial Reporting” of the International Financial Reporting Standards (IFRS), which have been published in the Bolsa Mexicana de Valores (BMV). See Notes and Definitions at the end of this release for further explanation of terms used herein.

Net revenues of $2,339 million in the fourth quarter of 2021 increased 34%. For full year 2021, net revenues of $8,783 million increased 37% as compared to 2020.

Revenues for the quarter grew in all businesses other than Precision Agriculture, and for the full year increased across all businesses. Primary drivers of the year over year increase included Polymer Solutions, which was driven by high PVC prices, and Building & Infrastructure, due to higher demand.

Cost of goods sold of $1,661 million in the fourth quarter of 2021 increased 36%. For full year 2021, cost of goods sold of $6,156 million increased 32% as compared to 2020.

These increases were primarily due to higher raw material costs and higher volumes, and to a lesser extent, increased freight and labor costs across all businesses.

SG&A of $332 million in the fourth quarter of 2021 increased 4% and as a percentage of sales decreased approximately 420 basis points to 14.2%. For full year 2021, SG&A of $1,178 million increased 12% as compared to 2020 and as a percentage of sales decreased approximately 290 basis points to 13.4%.

The increase in SG&A for the year was primarily due to continued investment in executing the Company’s growth strategy.

EBITDA of $504 million in the fourth quarter of 2021 increased 31% while EBITDA margin decreased approximately 50 basis points to 21.5%. For full year 2021, EBITDA of $2,047 million increased 55% as compared to 2020 and EBITDA margin increased approximately 280 basis points to 23.3%

The increase in EBITDA for the quarter was mainly driven by the solid performance of Polymer Solutions while the full year increase was largely driven by both Polymer Solutions and Building & Infrastructure. The decrease in EBITDA margin was driven by higher input costs impacting Orbia’s downstream businesses and the inclusion of higher revenues in the calculation.

Financial costs of $86 million in the fourth quarter of 2021 increased 150%. For full year 2021, financial costs of $297 million increased 23% as compared to 2020.

In the quarter, the increase was driven by the inclusion of approximately $23 million related to the valuation of put options held by the minority owners of the Netafim and Shakun Polymers operating entities, as well as FX losses related mainly to the depreciation of the Turkish Lira and the Mexican Peso.

For the full year the increase was driven by FX losses mainly related to the depreciation of the Turkish Lira, Mexican Peso and Colombian Peso as well as the impact of the valuation of the put options noted above. Additionally, the full year increase reflects one-time expenses associated with the early retirement of outstanding debt during the year.

Taxes of $109 million in the fourth quarter of 2021 increased 58%. The effective tax rate for the quarter was 41.9%, up by approximately 50 basis points compared to the same period of last year. For full year 2021, taxes of $381 million increased 153% as compared to 2020. The effective tax rate for the year was 33.0%, up by approximately 160 basis points compared to 2020.

The increase in the tax provision and rate in the quarter includes an impairment of certain tax assets, an increase in pre-tax earnings, and the Company’s geographic blend of pre-tax income or loss. In addition to these factors, the full year income tax expense and rate includes the tax impact of foreign exchange losses incurred in Mexico and the inflationary adjustment included in Orbia’s Mexican taxable income.

Net income to majority shareholders of $126 million in the fourth quarter of 2021 increased 91%, and increased 238% for the full year compared to 2020, to $657 million.

These changes were mainly driven by the increase in profits noted above.

Free cash flow of $304 million in the fourth quarter of 2021 remained flat and increased 4% for the full year as compared to 2020, to $572 million.

In the quarter, strong EBITDA and a source of cash from solid working capital management were partly offset by higher capital expenditures. For the full year, strong EBITDA performance was offset by increased working capital, due primarily to the impact of rising labor, transportation and raw material costs on selling prices and inventory values and an increase in capital expenditures, reflecting higher investments across most businesses after lower activity levels in 2020.

Net debt of $2,738 million was comprised of total debt of $3,520 million, less cash and cash equivalents of $782 million. The Company’s net debt-to-EBITDA ratio decreased from 2.09x to 1.34x year-over-year due to higher EBITDA.

Q4 and Full Year 2021 Revenues by Region

(All metrics are compared to Q4 and FY 2020 unless otherwise noted)

mm US$	Fourth Quarter
Region		2021		2020		% Var. Prev Year		% Revenue
Europe		777		560		39%		33%
North America		815		542		50%		35%
South America		512		410		25%		22%
Asia		154		182		-16%		7%
Africa and others		81		48		69%		3%
Total		2,339		1,742		34%		100%
mm US$	January - December
Region		2021		2020		% Var. Prev Year		% Revenue
Europe		3,036		2,169		40%		35%
North America		2,905		2,081		40%		33%
South America		1,942		1,254		55%		22%
Asia		651		707		-8%		7%
Africa and others		250		208		20%		3%
Total		8,783		6,420		37%		100%

Q4 and Full Year 2021 Financial Performance by Business Group

(All metrics are compared to Q4 and FY 2020 unless otherwise noted)

Precision Agriculture, 13% of Annual Revenues

Orbia’s Precision Agriculture brand Netafim's leading-edge irrigation systems, services and digital farming technologies enable stakeholders to achieve significantly higher and better-quality yields while using less water, fertilizer and other inputs. By helping farmers grow more with less, Orbia’s Netafim brand is contributing to feeding the planet more efficiently and sustainably.

mm US$		Fourth Quarter						January - December
Precision Agriculture		2021		2020		%Var.		2021		2020		%Var.
Total sales		266		270		-1%		1,126		972		16%
Operating income		(18)		29		N/A		46		89		-48%
EBITDA		10		53		-82%		146		181		-20%

Q4 revenues of $266 million decreased 1% and full year revenues of $1,126 million increased 16% compared to 2020. Q4 EBITDA of $10 million decreased 82% and EBITDA margin decreased approximately 1,590 basis points to 3.6% while full year 2021 EBITDA of $146 million decreased 20% and EBITDA margin decreased 570 basis points to 12.9% compared to 2020. Excluding one-time items, EBITDA margin for the year was 15.2% reflecting a decrease of approximately 340 basis points compared to 2020.

Netafim experienced growing demand in most parts of the world, with the exception of India, which continued to show COVID-19 related weakness. The recently acquired greenhouse business, Gakon Horticultural Projects, contributed to top-line growth.

Q4 EBITDA was impacted by approximately $19 million of one-time charges related to a project in Ethiopia and provisions recorded in India due to sustained pressure from COVID-19 and decisions by local governments to delay certain projects. The full-year impact of these items was approximately $26 million. The business experienced increasing raw material and transportation costs throughout the year, which have not yet been fully reflected in selling prices.

Data Communications, 11% of Annual Revenues

Orbia’s Data Communications brand Dura-Line produces more than 400 million meters of essential and innovative infrastructure annually – telecom conduit, cable-in-conduit and other HDPE products and solutions that create physical pathways for fiber and other network technologies to connect cities, homes and people worldwide.

mm US$		Fourth Quarter						January - December
Data Communications		2021		2020		%Var.		2021		2020		%Var.
Total sales		297		176		69%		994		732		36%
Operating income		33		26		23%		102		140		-27%
EBITDA		41		34		19%		134		173		-23%

Q4 revenues of $297 million increased 69% and full year revenues of $994 million increased 36% compared to 2020. Q4 EBITDA of $41 million increased 19% and EBITDA margin decreased approximately 570 basis points to 13.6% while full year EBITDA of $134 million decreased 23% and EBITDA margin decreased approximately 1,020 basis points to 13.5% compared to 2020.

For both the quarter and full year periods, Data Communications’ revenue growth in North America and Europe reflected higher prices following input cost increases, continued strong market demand, enhanced sales coverage and new fiber deployment projects.

Q4 EBITDA in Data Communications reflected strong sales volumes and a nearly full pass-through of cost increases seen during the year in raw materials, transportation and labor. The full year EBITDA results reflect the lag incurred during the first three quarters of the year, when price adjustments were not able to fully offset the impact of rising input costs. These results contrast with the significant EBITDA margin levels the business experienced in 2020, which were driven by low raw material costs.

Building & Infrastructure, 33% of Annual Revenues

Orbia’s Building & Infrastructure brand Wavin is redefining today’s pipes and fittings industry by creating solutions that last longer and require less labor to install. Benefiting from PVC supply chain integration with the Polymer Solutions brands and its ability to serve customers on three continents, Orbia’s Wavin brand is also developing sustainable technologies around water management and indoor climate systems for the development of the efficient livable, lovable and resilient cities of the future.

mm US$		Fourth Quarter						January - December
Building & Infrastructure		2021		2020		%Var.		2021		2020		%Var.
Total sales		702		582		21%		2,922		2,071		41%
Operating income		44		46		-4%		283		127		123%
EBITDA		82		88		-6%		424		261		63%

Q4 revenues of $702 million increased 21% while full year revenues of $2,922 million increased 41% compared to 2020. Q4 EBITDA of $82 million decreased 6% and EBITDA margin decreased 340 basis points to 11.7% while full year EBITDA of $424 million increased 63% and EBITDA margin increased approximately 190 basis points to 14.5% compared to 2020.

Q4 performance aligned with a more normalized market environment, following a period of logistical disruptions and product shortages earlier in the year. Sales volumes in the first half of the year were particularly strong, as the business benefited from being able to obtain dependable supplies of PVC through the Polymer Solutions business during a period of raw material supply shortages. The second half of the year saw a return to a more normalized market environment, with increased availability of PVC.

First-half EBITDA performance was better year-over-year as compared to 2020, driven by volume increases, effective price management and a mix shift to value-added products—this was partially offset by the impact of a more competitive market and continued increases in input costs during the second half of the year.

Fluorinated Solutions, 8% of Annual Revenues

Orbia’s Fluorinated Solutions brand Koura provides fluorine and downstream products that support modern living in a vast number of ways. Orbia’s Koura brand operates the world’s largest fluorspar mine and produces intermediates, refrigerants and propellants used in automotive, infrastructure, semiconductor, health, medicine, climate control, food cold chain, energy storage, computing and telecommunications applications.

mm US$		Fourth Quarter						January - December
Fluorinated Solutions		2021		2020		%Var.		2021		2020		%Var.
Total sales		198		182		9%		744		698		7%
Operating income		52		40		29%		183		193		-6%
EBITDA		67		58		15%		244		254		-4%

Q4 revenues of $198 million increased 9% while full year 2021, revenues of $744 million increased 7% compared to 2020. Q4 EBITDA of $67 million increased 15% and EBITDA margin increased approximately 160 basis points to 33.6% while full year EBITDA of $244 million decreased 4% and EBITDA margin decreased approximately 360 basis points to 32.9% compared to 2020.

For both the quarter and the year, growth in revenues reflected improved product mix and pricing across all product lines, especially in refrigerants, hydrofluoric acid and metspar.

EBITDA for Q4 and the year reflected higher raw material and supply chain costs and strategic investments to support the growth of the business. For Q4, higher pricing and favorable product mix more than offset these cost increases while for the full year, cost increases exceeded the impacts of price and mix.

Polymer Solutions , 35% of Annual Revenues

Orbia’s Polymer Solutions brands Vestolit and Alphagary focus on PVC general and specialty resins and PVC and zero-halogen specialty compounds with a wide variety of applications in solutions that undergird everyday life. Orbia’s Vestolit and Alphagary brands supply Orbia’s downstream brands and global customers seeking applications in pipes, cables, flooring, auto parts, household appliances, clothing, packaging, health and safety and medical devices.

mm US$		Fourth Quarter						January - December
Polymer Solutions		2021		2020		%Var.		2021		2020		%Var.
Total sales*		999		617		62%		3,438		2,171		58%
Operating income		252		103		145%		876		224		291%
EBITDA		320		158		103%		1,134		462		145%
*Intercompany sales were $94 million and $66 million in 4Q21 and 4Q20, respectively. Full year intercompany sales were $322 million and $174 million in 2021 and 2020, respectively.

Q4 revenues of $999 million increased 62% while full year revenues of $3,438 million increased 58% compared to 2020. Q4 EBITDA of $320 million increased 103% and EBITDA margin increased approximately 640 basis points to 32.1% while full year 2021 EBITDA of $1,134 million increased 145% and EBITDA margin increased 1,170 basis points to 33.0% compared to 2020.

For both Q4 and the full year, Polymer Solutions maintained PVC price leverage, resulting from robust demand in the construction industry and a continued tight supply/demand environment. Sales performance in key markets exceeded pre-pandemic levels, complemented by increased compounds prices and the inclusion of Shakun Polymers, in which the business acquired a majority ownership interest in Q2 2021. These factors led to strong results in both revenues and EBITDA as compared to 2020.

Balance Sheet, Liquidity and Capital Allocation

Orbia continued to strengthen its balance sheet, generating free cash flow of $304 million during the fourth quarter and $572 million during 2021. The Company’s net debt-to-EBITDA ratio decreased from 2.09x to 1.34x year-over-year.

Working capital decreased by $92 million during the quarter, but increased by $479 million during the year, primarily reflecting higher selling prices and higher inventory costs. Capital expenditures of $122 million during the quarter increased 74% year-over-year and increased 36% for the full year to $311 million.

The Company’s average debt maturity is 14.8 years, while its average cost of debt is 4.1%. Orbia’s next material debt maturity is in 2026.

Orbia returned $146 million to shareholders in the quarter, consisting of $49 million of dividends and $97 million of share buybacks. For the full year, the Company returned $365 million to shareholders, consisting of $199 million of dividends and $166 million of share buybacks. Pursuant to the approval granted by its shareholders, the Company has canceled 90 million of its shares held in treasury during the quarter.

2022 Outlook

Broad market volatility, logistical and inflationary challenges and COVID 19 uncertainty have continued to impact the global environment in the early part of 2022, making near-term forecasting challenging.

Assuming no significant unexpected disruptions, Orbia expects Net Sales to increase moderately and EBITDA to be in the range of $1,600 million to $1,750 million for the year. Orbia is also expecting capital expenditures in the range of $350 million to $450 million for 2022, which includes incremental, high-return, growth-related projects but excludes potential larger growth investments. The effective tax rate for the year is expected to be between 29% and 32%.

Given the Company’s growth plans, its low leverage ratio and the current attractive interest rate environment, Orbia expects to explore alternatives for both short- and longer-term debt financing in 2022.

For each of Orbia’s businesses The Company is assuming the following:

• Polymer Solutions: The PVC market is expected to remain healthy, with prices softening yet settling above pre-pandemic levels and global demand growing above supply, resulting in a tight supply/demand balance.
• Building & Infrastructure: A normalization of market conditions is expected as raw material supply constraints continue to ease. The business will continue to manage margins and to focus on driving a higher value sales mix.
• Precision Agriculture: Strong demand is expected to continue in most parts of the world, with strong market fundamentals. The business will continue to focus on offsetting input cost increases through the year.
• Data Communications: Volume and revenue growth will be driven by fiber infrastructure investments in U.S., Canada and Europe. Additionally, the Company expects a normalization of raw material costs through the year.
• Fluorinated Solutions: Improvements in revenue are expected across the product portfolio due to market strengthening and new regulations. Additionally, the business expects to manage margins closely, with continued pressure on raw material prices and inflationary impacts.

Looking forward, the Company’s management is confident that the continued execution of Orbia’s strategic plans, driven by organic growth and selective bolt-on acquisitions, will generate sustainable and profitable growth, with both Net Sales and EBITDA growing at compound annual growth rates in the high single digit range or more over the longer term.

The Company's Board of Directors has approved, and intends to recommend to its shareholders for their approval at Orbia's next Annual General Meeting of Shareholders, (i) ordinary dividend payments of $240 million payable in four quarterly installments in 2022, (ii) an additional extraordinary dividend payment of $60 million dollars, also payable in quarterly installments and (iii) authorization to establish a share repurchase fund to repurchase Company shares up to the maximum amount permitted by law.

Conference Call Details

Orbia will host a conference call to discuss Q4 2021 results on February 24, 2022, at 9:30 am Central Time (CT; Mexico City)/10:30 am Eastern Time (ET; New York). To access the call, please dial 001-855-817-7630 (Mexico), 1-888-339-0721 (United States) or 1-412-317-5247 (International).

Participants may pre-register for the conference call here.

The live webcast can be accessed here.

A recording of the webcast will be posted several hours after the call is completed on Orbia’s website.

For all company news, please visit Orbia’s newsroom.

Consolidated Income Statement

USD in millions		Fourth Quarter								January - December
Income Statement		2021		2020		%				2021		2020		%
Net sales		2,339		1,742		34%				8,783		6,420		37%
Cost of sales		1,661		1,221		36%				6,156		4,651		32%
Gross profit		678		521		30%				2,627		1,769		49%
SG&A		332		321		4%				1,178		1,048		12%
Operating income (loss)		345		201		72%				1,449		720		101%
Financial cost		86		34		150%				297		242		23%
Equity in income of associated entity		0		(0)		N/A				(1)		(1)		69%
Income (loss) from continuing operations before income tax		259		166		56%				1,154		479		141%
Income tax		109		69		58%				381		151		153%
Income (loss) from continuing operations		151		98		54%				773		328		135%
Discontinued operations		(0)		(1)		-93%				(0)		(10)		-96%
Consolidated net income (loss)		151		96		57%				772		319		142%
Minority stockholders		25		30		-18%				115		124		-7%
Majority Net income (loss)		126		66		91%				657		195		238%
EBITDA		504		383		31%				2,047		1,318		55%

Note: During 2021 the Company performed a reclassification of criteria from SG&A to cost of goods sold in relation to Direct Storage & Dispatch for approximately $21 million for Q4 20, and $78 million for FY 2020, to fully align criteria among all segments.

Consolidated Balance Sheet

		USD in millions
Balance sheet		Dec 2021		Dec 2020
Total assets		10,587		10,211
Current assets		3,724		3,156
Cash and temporary investments		782		875
Receivables		1,370		1,093
Inventories		1,292		861
Others current assets		282		326
Non current assets		6,862		7,055
Property, plant and equipment, Net		3,051		3,186
Right of use Fixed Assets, Net		346		323
Intangible assets and Goodwill		3,130		3,225
Long-term assets		335		320
Total liabilities		7,182		7,032
Current liabilities		2,643		2,588
Current portion of long-term debt		240		495
Suppliers		1,505		1,326
Short-term leasings		86		82
Other current liabilities		812		684
Non current liabilities		4,539		4,444
Long-term debt		3,280		3,131
Long-term employee benefits		221		274
Long-term deferred tax liabilities		318		314
Long-term leasings		281		263
Other long-term liabilities		440		463
Consolidated shareholders'equity		3,404		3,180
Minority shareholders' equity		668		687
Majority shareholders' equity		2,737		2,493
Total liabilities & shareholders' equity		10,587		10,211

Operating Cash Flow

		Fourth Quarter						January - December
mm US$		2021		2020		%Var.		2021	2020	% Var.
EBITDA		504		383		31%		2,047	1,318	55%
Taxes paid, net		(85)		(86)		0%		(278)	(264)	5%
Net interest / Bank commissions		(32)		(18)		75%		(252)	(196)	29%
Change in trade working capital		92		89		3%		(479)	32	N/A
Others (Other assets - provisions, Net)		1		(28)		N/A		10	4	132%
CTA and FX		(30)		49		N/A		(67)	(24)	178%
Operating cash flow		450		390		15%		982	871	13%
Capital expenditures		(122)		(70)		74%		(311)	(228)	36%
Leasing payments		(24)		(16)		51%		(98)	(90)	9%
Free cash flow		304		304		0%		572	552	4%
FCF conversion (%)		60.3%		79.2%				28.0%	41.9%
Dividends to Shareholders		(49)		(45)		9%		(199)	(230)	-13%
Buy-back shares program		(97)		-				(166)	(42)	295%
New debt (paid)		15		(597)		N/A		(122)	178	N/A
Minority interest payments		(34)		(26)		30%		(138)	(141)	-2%
Mergers & Acquisitions		(11)		-				(48)	-
Financial instruments and others		0		(5)		N/A		8	(27)	N/A
Net change in cash		126		(369)		N/A		(94)	289	N/A
Initial cash balance		655		1,245		-47%		875	586	49%
Cash balance		782		875		-11%		782	875	-11%

Notes and Definitions

The results contained in this release have been prepared in accordance with International Financial Reporting Standards (“NIIF” or “IFRS”) with U.S. Dollars as the reporting currency. Figures are presented in millions, unless specified otherwise.

Reflective of Orbia’s continuous efforts to better inform the market and become a more customer-centric organization, beginning in Q1 2020, the Company is presenting the revenues, operating incomes and EBITDAs of each of its five businesses and commercial brands as follows: Precision Agriculture (Netafim), Data Communications (Dura-Line), Building & Infrastructure (Wavin)—all of which previously were combined and presented as “Fluent” for reporting purposes only—as well as Fluorinated Solutions (Koura) and Polymer Solutions (Vestolit and Alphagary).

Figures and percentages have been rounded and may not add up.

About Orbia

Orbia is a community of businesses united by a shared purpose: to advance life around the world. The Orbia businesses and affiliated commercial brands have a collective focus on ensuring food security, reducing water scarcity, connecting communities to data infrastructure, reinventing the future of cities and homes and expanding access to health and wellness with basic and advanced materials. Orbia operates in the Precision Agriculture, Data Communications, Building & Infrastructure, Fluorinated Solutions and Polymer Solutions sectors. The Company has commercial activities in more than 110 countries and operations in over 50, with global headquarters in Mexico City, Boston, Amsterdam and Tel Aviv. To learn more, please visit orbia.com.

Prospective Information

In addition to historical information, this press release contains "forward-looking" statements that reflect management's expectations for the future. The words “anticipate,” “believe,” “expect,” “hope,” “have the intention of,” “might,” “plan,” “should” and similar expressions generally indicate comments on expectations. The final results may be materially different from current expectations due to several factors, which include, but are not limited to, global and local changes in politics, economic factors, business, competition, market and regulatory factors, cyclical trends in relevant sectors as well as other factors that are highlighted under the title “Risk Factors” in the annual report submitted by Orbia to the Mexican National Banking and Securities Commission (CNBV) and available on our website at https://www.orbia.com/investor-relations/financial-reports/annual-reports-and-filings/. The forward-looking statements included herein represent Orbia’s views as of the date of this press release. Orbia undertakes no obligation to revise or update publicly any forward-looking statement for any reason unless required by law.”

Orbia has implemented a Code of Ethics that helps define our obligations to and relationships with our employees, clients, suppliers, and others. Orbia’s Code of Ethics is available for consultation at the following link: http://www.Orbia.com/Codigo_de_etica.html. Additionally, according to the terms contained in the Mexican Securities Exchange Act No 42, the Orbia Audit Committee has established a “hotline” system permitting any person who is aware of a failure to adhere to applicable operational and accounting records guidelines, internal controls or the Code of Ethics, whether by the Company itself or any of its controlled subsidiaries, to file a complaint (including anonymously). This system is operated by an independent third-party service provider. The system may be accessed via telephone in Mexico, via internet at http://www.ethics.orbia.com or via email at ethics@orbia.com. Orbia’s Audit Committee has oversight responsibility for ensuring that all such complaints are appropriately investigated and resolved.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220223006132/en/

Investors

Gerardo Lozoya, Investor Relations Director

+52 55 5366 4084

gerardo.lozoya@orbia.com

Media

Kacy Karlen, Corporate Communications Director

+1 865-410-3001

kacy.karlen@orbia.com

Source: Orbia Advance Corporation, S.A.B. de C.V.

FAQ

What were the Q4 2021 revenue figures for Orbia Advance Corporation (MXCHY)?

Orbia's Q4 2021 net revenues were $2.3 billion, a 34% increase compared to Q4 2020.

How much did Orbia report in net majority income for FY 2021?

Orbia reported a net majority income of $657 million for FY 2021, a 238% increase from the prior year.

What is Orbia's EBITDA forecast for 2022?

Orbia expects EBITDA in the range of $1.6 billion to $1.75 billion for 2022.

How did Orbia's financial costs change in Q4 2021?

Financial costs in Q4 2021 increased by 150%, mainly due to foreign exchange losses.

What growth did Orbia achieve in shareholder returns for 2021?

Orbia returned $365 million to shareholders in 2021 through dividends and share buybacks.