Solvay advances long-term value creation with new objectives

Solvay advances long-term value creation with new objectives

7:45 AM, 3rd October 2016
Solvay advances long-term value creation with new objectives
Jean-Pierre Clamadieu, CEO of Solvay. (File photo)

BRUSSELS, BELGIUM: Solvay SA upgrades its strategic transformation, reaffirms its monetary management for 2016 and reveals medium-term value ideas that will accelerate its drive to create sustainable and long-term value as a multi-specialty chemical company.  

Senior executives debated with investors and experts market advancements and Solvay’s driving positions and innovative solutions. They covered growth opportunities in Advanced Materials for sustainable mobility, including batteries for electric vehicles and composites in aircraft and cars. They additionally covered the unique capabilities of Advanced Formulations in surface chemistry and fluid behaviours, which focus on yield and efficiency optimisation while reducing environmental footprint.

Solvay has further reinforced its position in Advanced Materials through numerous contract awards, high profile qualifications and capacity expansions to serve industry’s leading companies. It's recognised technology leadership and application expertise allow Solvay to develop sustainable solutions with strategic customers such as Airbus, Boeing and Safran. It has shown its commitment to sustainable solutions with a recent agreement to only use renewable energy by 2018 for all products it supplies to Apple.

The company also highlighted the strong progress on the Cytec merger. Delivery exceeds expectations and the acquisition will be cash accretive in 2016, one year ahead of plan. Given the progress, synergy expectations are increased by 50 percent to € 150 million by 2018. 

The company’s new objectives for the three-years to 2018 include both sustainability and monetary targets. 

The sustainability targets will strengthen long lasting market leadership positions and include commitments to:

  • reduce greenhouse gas intensity by a fifth;
  • increase the amount of sustainable solutions to 40 percent of group sales.

These commitments will help to increase monetary value delivery from 2016 to 2018. Objectives include:

  • annual mid-to-high-single-digit EBITDA growth. This objective reflects a continued focus on excellence programmes, with operational excellence alone delivering a further € 450 million. Solvay is also committed to maintaining its investment grade, which is another lever to sustain the additional value that will be created;
  • a growing free cash flow generation exceeding € 2.4 billion;
  • a rise of cash flow returns on investment by 50-100 basis points.

“The change towards a multi-specialty chemical company will continue. Our new mid-term targets encompass sustainability as well as financial delivery, to create value that stands the test of time,” said Jean-Pierre Clamadieu, CEO of Solvay.

© Worldofchemicals News

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