Business News
NOVA Chemicals Reports Third Quarter 2010 Results
Monday 15. November 2010 - Operating Income Improves as Margins and Demand Increase
Third Quarter 2010 Results
In the third quarter of 2010, we generated net income of $54 million compared to a net loss of $19 million for the period July 6 to September 30, 2009 and a net loss of $33 million for the period July 1 to July 5, 2009. For the nine months ended September 30, 2010, we generated net income of $199 million compared to a net loss of $19 million for the period July 6 to September 30, 2009 and a net loss of $239 million for the period January 1 to July 5, 2009. The year-over-year improvement during these periods was primarily due to higher margins and improved demand for our products.
The Olefins/Polyolefins business unit generated $139 million of operating income in the third quarter of 2010 compared to operating income of $112 million in the period July 6 to September 30, 2009 and no operating income in the period July 1 to July 5, 2009. For the nine months ended September 30, 2010, the business unit generated operating income of $576 million compared to operating income of $112 million for the period July 6 to September 30, 2009 and $43 million for the period January 1 to July 5, 2009. The improvement during these periods was due to selling prices increasing more than feedstock costs, and improved demand.
Our 50% share of the INEOS NOVA joint ventures operating income was $17 million in the third quarter of 2010 compared to operating income of $5 million in the period July 6 to September 30, 2009 and no operating income in the period July 1 to July 5, 2009. For the nine months ended September 30, 2010, our 50% share of the joint ventures operating income was $28 million versus operating income of $5 million for the period July 6 to September 30, 2009 and $6 million for the period January 1 to July 5, 2009. The improvement during these periods was mainly due to improved margins.
The Performance Styrenics segment reported operating income from continuing operations of $2 million in the third quarter of 2010 compared to operating income from continuing operations of $4 million in the period July 6 to September 30, 2009 and no operating income from continuing operations in the period July 1 to July 5, 2009. For the nine months ended September 30, 2010, the segment had $1 of million operating income from continuing operations compared to operating income from continuing operations of $4 million in the period July 6 to September 30, 2009 and an operating loss from continuing operations of $19 million for the period January 1 to July 5, 2009. Lower operating costs attributed to our 2009 restructuring led to improvement in the periods, while higher feedstock costs negatively impacted the third quarter of 2010.
Highlights
On October 31, 2010, we and INEOS entered into an agreement providing for the acquisition by INEOS of 100% of our equity interest in the INEOS NOVA joint venture. We expect the transaction to close in the first quarter of 2011, subject to receipt of regulatory approvals, required consents and other customary closing conditions.
On August 30, 2010, we repaid our Canadian $250 million 7.85% notes using cash-on-hand.
On September 8, 2010, we entered into a new bilateral credit facility for $100 million with a maturity date of September 20, 2015.
On October 28, 2010 we amended our senior secured revolving credit facility to extend the maturity date one year to November 17, 2013 and to increase the size from $350 million to $425 million.