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Orion to Increase Prices, Reduce Payment Terms for Rubber Carbon Black Made in Europe and the Americas
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Rhea-AI Summary
Orion Engineered Carbons (NYSE: OEC) announced a 20% price increase for all rubber carbon black products in Europe and the Americas, effective from August 1, 2022. The company cites rising manufacturing costs, including investments in environmental controls and operating expenses, as reasons for this adjustment. Additionally, payment terms will be reduced by at least 50% to align with updated regional standards. This strategy aims to maintain stable supply reliability amidst increasing feedstock costs, according to CEO Corning Painter.
Positive
20% price increase expected to offset rising manufacturing and operational costs.
Reduced payment terms enhance working capital management.
Negative
Price increase may limit customer demand, impacting future sales.
Dependency on increased feedstock prices poses risk to profit margins.
HOUSTON--(BUSINESS WIRE)--
Orion Engineered Carbons (NYSE: OEC), a global specialty chemicals company, announced today it will raise prices by 20% for all rubber carbon black products manufactured in Europe and the Americas.
Payment terms will be reduced by at least 50% to conform with updated standards across the different regions. The changes will be effective for all shipments on or after Aug. 1, 2022, or as contracts permit.
“This price adjustment reflects increased manufacturing costs, environmental control investments and operating costs, as well as continued investments to ensure reliable supply,” said Orion CEO Corning Painter. “Given the increased cost of feedstocks, payment terms need to be reduced to acceptable working capital levels. This will enable us to continue to deliver stable and reliable supplies to our customers.”
About Orion Engineered Carbons
Orion Engineered Carbons (NYSE: OEC) is a leading global supplier of carbon black, a solid form of carbon produced as powder or pellets. The material is made to customers’ exacting specifications for tires, coatings, ink, batteries, plastics and numerous other specialty, high-performance applications. Carbon black is used to tint, colorize, provide reinforcement, conduct electricity, increase durability, and add UV protection. Orion has innovation centers on three continents and 14 plants worldwide, offering the most diverse variety of production processes in the industry. The company’s corporate lineage goes back more than 160 years to Germany, where it operates the world’s longest-running carbon black plant. Orion is a leading innovator, applying a deep understanding of customers’ needs to deliver sustainable solutions. For more information, please visit orioncarbons.com.
Forward-Looking Statements
This document contains certain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements of future expectations that are based on current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. You should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement. New risk factors and uncertainties emerge from time to time and it is not possible to predict all risk factors and uncertainties, nor can we assess the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information, other than as required by applicable law.
Wendy Wilson Head of Investor Relations
Orion Engineered Carbons Direct: +1 281-974-0155
wendy.wilson@orioncarbons.com
William Foreman Director of Corporate Communications and Government Affairs
Orion Engineered Carbons Direct: +1 832-445-3305
Mobile: +1 281-889-7833
william.foreman@orioncarbons.com
Source: Orion Engineered Carbons S.A.
FAQ
What are the new prices for Orion Engineered Carbons' products?
Orion Engineered Carbons will increase prices by 20% for all rubber carbon black products.
When does the price increase take effect for Orion Engineered Carbons?
The price increase will be effective from August 1, 2022.
What financial reasons did Orion Engineered Carbons give for the price hike?
The price hike is due to increased manufacturing costs, environmental control investments, and operating expenses.
How will payment terms change for Orion Engineered Carbons?
Payment terms will be reduced by at least 50% to conform to updated regional standards.
Is Orion Engineered Carbons' price increase a reflection of market conditions?
Yes, it reflects the increased cost of feedstocks and operational challenges.
