From the Sector

In cooperation with the Swiss company Haelixa, Oerlikon Manmade Fibers Solutions will, in future, be able to make the entire value chain of a textile end product transparent and hence sustainable. The two development partners are offering a solution for the comprehensive traceability of products, as required by the European Green Deal.

An essential part of the solution is the DNA marker technology developed by Haelixa that enables complete traceability of materials. These markers survive all production process steps, validating that the end product is identifiable. "This innovative technology employs distinct DNA tailored for each project, establishing a unique identity for the material," explains Holly Berger, Marketing Director at Haelixa. "Once the DNA is integrated into the material, it becomes irremovable, impervious to falsification or alteration." Handling is straightforward: the DNA marker is fed into the spinning process with the preparation oil, for example. The preparation system is modified accordingly. Further feeding options are currently being developed.

Smart factory: total transparency with atmos.io
The concept is complemented by atmos.io, Oerlikon's digital platform, which records and evaluates extensive production and process data during the yarn manufacturing process. Atmos.io gives the yarn its digital identity during its time on Oerlikon systems, from the melt to the packaged package. This technology has been used successfully for some time to monitor the production process. With atmos.io, deviations in process parameters and yarn data can be identified and rectified within a very short time, which in turn keeps the yarn quality stable and reduces waste rates.

Combining both technologies enables clear traceability of the yarn produced, even in the downstream process steps. Hence, the yarn's components, qualities, manufacturing conditions, and origin are traced beyond doubt in the finished garment. "The unique DNA carries the 'roots' of the yarn digitally recorded in atmos.io into the everyday life of the end consumer," says Jochen Adler, CTO at Oerlikon Manmade Fibers. The textile end products meet the requirements of the digital product passport required by the EU, which contains the information needed to assess their life cycle assessment and circularity. Initial long-term tests have shown 100% traceability of the yarns in the POY and FDY spinning process. If the yarn manufacturer relies on the atmos.io platform, production systems can be adapted relatively easily to use the DNA markers.

HeiQ AeoniQ™ becomes an active brand partner of the Canopy initiative with eleven other companies to address the growing climate and biodiversity crises by committing to keep Ancient and Endangered Forests out of our man-made cellulosic fiber supply chain.

The commitments that HeiQ AeoniQ™ is making are part of solutions-driven non-profit Canopy’s Pack4Good and CanopyStyle initiatives which currently represent collectively 950 brand partners. Together, the initiatives are shifting supply chains away from vital forests to low-impact, circular Next Gen Solutions.

“We must rapidly replace oil-based polyester in the textile industry causing microplastics, global warming, landfill and ecosystem degradation. Cellulose is the most abundant biopolymer in the world and is best suited to replace polyester. However, we must pay attention to cellulose feedstock sources. Our forests, a potential cellulose feedstock, are one of the most important solutions to addressing the effects of climate change. Approximately 2.6 billion tons of carbon dioxide, one-third of the CO₂ released from burning fossil fuels, is absorbed by forests every year. Around 12.5% of global greenhouse gas emissions (5-10 GtCO₂e annually) come from deforestation. We are losing forests at an alarming rate. Every year, around 10 million hectares of forests globally are destroyed. We need immediate action to increase forests again. Canopy is our go-to partner to replace polyester with circular & sustainable cellulose feedstock for our innovative HeiQ AeoniQ™ fiber revolution.” said Carlo Centonze, HeiQ Group CEO.

Paper packaging is also a key driver of forest loss globally, as 3.1 billion trees are cut down annually to produce the boxes and bags in which products are packaged and shipped. Paper packaging production has increased by 65% over the past two years.

“The range of companies and sectors represented in today’s announcement reflects the breadth of market response to the growing climate and biodiversity crises and intensifying supply chain disruptions,” said Nicole Rycroft, Founder and Executive Director of Canopy. “Today’s brand partners add significant momentum to global conservation efforts and the movement to transform ‘take, make, waste’ supply chains to be lower-impact and Next Gen.”

Today, as part of Pack4Good, HeiQ AeoniQ™ committed to:

• Eliminate Ancient and Endangered Forests from our paper packaging supply chain.
• Reduce material use through design innovation.
• Maximize recycled content.
• Explore and scale alternative Next Gen fibers (such as agricultural residues).
• Where virgin fiber is necessary, use FSC-certified fiber.

The textile machinery orders index, as processed by the Economics Department of ACIMIT, the Association of Italian Textile Machinery Manufacturers, dropped fully 20% during the third quarter of 2023, compared to the same period for July to September 2022. In absolute terms, the index stood at 84.2 points (basis: 2015=100).

This result is due to a reduction in new orders recorded by manufacturers both on the domestic market and abroad. The decrease in orders in Italy came in at 45%, whereas the drop was just 13% on foreign markets. The absolutevalue of the index abroad stood at 80.5 points, and 119.4 points in Italy. During the year’s third quarter, new orders reached 3.7 months of assured production.

ACIMIT President Marco Salvadè commented on the data, stating that, “The order index for the period from July to September 2023 confirms a contraction in collected orders that was already evident in previous quarters. What worries us above all is the situation with our domestic market, where the declining trend has persisted for seven consecutive terms. Due to this situation, which does not only concern the textile machinery industry, urgent measures are needed from Italian Government to strengthen the competitiveness of Italian manufacturers.”

As far as foreign markets are concerned, the orders index confirms an overall weakened global demand for textile machinery. Indeed, for the first half of 2023, Italian exports slowed in a variety of essential benchmark markets, such as Turkey, China and the United States.

“The global economic scenario remains negative, as consumers are facing a reduced purchasing power, with investments in the textile sector consequently also slowing down,” concludes Salvadè. “In less than a month, ITMA ASIA + CITME will be held from 19 to 23 November in Shanghai, primed as one of the world’s major trade fairs for the textile machinery industry, with the participation of roughly 60 Italian textile machinery manufacturers. We can expect some significant indications on the industry’s state from this event, which will be staged in one of the strategic markets for textile machinery demand.”

Highlights

• Net sales in the third quarter of 2023 were down by -20.3% organically versus a record Q3 2022 as expected due to -15% lower volumes (€-512 million) in a weaker macro environment and -5% lower prices (€-188 million) in a context of lower raw material costs and energy prices. On a sequential basis, net sales were down -11% versus Q2. The volume reduction was broad based across regions and businesses.
• Structural cost savings for the first nine months of 2023 amounted to €63 million, bringing the total savings since 2019 to €530 million.
• Underlying EBITDA of €702 million in Q3 2023 was down by -18.5% organically compared to a record Q3 2022 driven by lower volumes, partly offset by €36 million in positive net pricing and €41 million in lower fixed costs. Nine months EBITDA at €2,331 million is only down -1% organically versus 2022, a clear indication that strong historic pricing and cost discipline momentum is being maintained.
• The underlying EBITDA margin of 25.6% in Q3 2023 was sustained relative to Q3 2022 despite lower volumes, while nine months EBITDA margin of 25.9% is +1.3pp higher, mainly as a result of positive net pricing and cost discipline.
• Underlying Net Profit was €340 million in Q3 2023 compared to €509 million in Q3 2022.
• Free Cash Flow of €346 million in Q3 2023 resulted in a nine-month 2023 total of €1,027 million and a FCF conversion ratio of 39.4%.
• ROCE was 15.2%, broadly in line with Q3 2022.
• Continued strengthening of the balance sheet with underlying net debt at €2.8 billion, which translated to a historic low leverage of 0.9x.
• As explained on page 2, an interim dividend of €1.62 gross per share has been validated by the Board of Directors, in line with historical interim dividend policy to be paid by Solvay SA on January 17, 2024.

2023 Outlook
Given the current volume momentum, Solvay reconfirm their full year guidance, at the lower end of the prior EBITDA guidance range.

Solvay announced the future Board of Directors of SYENSQO, effective upon completion of the planned separation of Solvay into two companies – SOLVAY and SYENSQO – which is on track to be completed in December 2023.

SYENSQO’s Board will be composed of 10 members, including 6 independent members, 3 members representing the reference shareholder, Solvac, and the company CEO. They have deep expertise in specialty industries, international business operations, risk management, corporate governance, finance and clean technology.

The following individuals will serve on the SYENSQO Board of Directors:
Rosemary Thorne will serve as independent Director and Chair of the SYENSQO Board, as well as Chair of the Board’s Finance Committee. She is currently an Independent Director on the Solvay Board of Directors, appointed in 2014, and Chair of the Board’s Audit Committee. She is also an Independent Director on the Board of Merrill Lynch International (UK), a wholly-owned subsidiary of Bank of America, serving as Chair of the Audit Committee. Ms. Thorne has decades of financial leadership experience across a wide range of industries. She previously served as Chief Financial Officer at J. Sainsbury, the UK’s largest supermarket chain at the time; Bradford & Bingley; and Ladbrokes. Ms. Thorne previously sat as an Independent Director on the Boards of Royal Mail Group, Cadbury Schweppes, Santander UK, First Global Trust Bank and Smurfit Kappa Group.

Dr. Ilham Kadri will serve as Chief Executive Officer and member of the Board of Directors of SYENSQO. She is currently CEO and President of the Executive Committee at Solvay. Ms. Kadri has successfully led the turnaround of Solvay, delivering double-digit EBITDA growth and 18 consecutive quarters of positive free cash flow, deleveraging the balance sheet and promoting superior people engagement. She is an independent Board member at A.O. Smith and L’Oréal. She is active in non-profit organizations, as Chair of the World Business Council for Sustainable Development (WBCSD), member of the steering committee of the European Round Table of Industrialists (ERT) as well as a permanent member of the World Economic Forum’s International Business Council (WEF). Ms. Kadri has extensive leadership experience across a variety of industries in four continents and with leading industrial multinationals, including Shell, UCB, Huntsman, Dow, Sealed Air. Prior to Solvay, she was CEO and President of Diversey in the USA, led the company’s return to profitability and resulting spin off and divestiture to Bain Capital. She founded two non-Profit foundations: the Solvay Solidarity Fund in Belgium in 2020 which supported more than 7000 families affected by Covid-19 and natural disasters; and founded the ISSA Hygieia Network in 2015 in the USA, to help women in the cleaning industry. She received two Doctor Honoris Clausa from EWHA University in Korea and Université de Namur in Belgium.

Julian Waldron will serve as independent Director and Chair of the Audit Committee. He currently serves as Deputy Executive Chairman of privately-held Albea Group, a global beauty and personal care packaging company which operates 35 facilities in Europe, Asia and the Americas. Mr. Waldron has held senior leadership roles at several leading listed companies in the industrial, technology and services sectors and brings a wealth of expertise in finance and business operations. Prior to joining Albea in 2022, he was Chief Financial Officer of Suez for three years after serving as Chief Financial Officer and subsequently Chief Operating Officer of Technip. He started his career at UBS Warburg where he spent 14 years. Mr. Waldron also served as an independent Board member and Chairman of finance, risk and investments at Carbon Clean, a privately-owned carbon capture company dedicated to achieving net zero.

Heike Van de Kerkhof will serve as independent Director and Chair of the Nomination Committee. She currently sits on the Board of OCI N.V.. Ms. Van de Kerkhof brings more than 30 years of experience in the chemicals, oil & gas and materials industries, having served in numerous leadership roles around the globe. From 2020 to 2023, she was Chief Executive Officer of Archroma Management, a global specialty chemicals company. During her tenure, she successfully completed the transformational acquisition of Huntsman’s Textile Effects business. Prior to her role at Archroma, Ms. Van de Kerkhof served as Vice President of Lubricants, Western Hemisphere at BP, and held positions at Castrol, The Chemours Company, and Neste Corporation. She also held many leading roles within DuPont over 18 years.

Matti Lievonen will serve as independent Director and Chair of the Compensation Committee. He is currently an independent director on the Solvay Board, appointed in 2017. Mr. Lievonen is a proven executive in the energy, forestry, power and automation industries with an extensive track record of leading businesses through climate transition. For over ten years until 2018, he served as Chairman and Chief Executive Officer of Neste Corporation, a global leader in next-generation renewable fuels and chemicals. During his time at Neste, Mr. Lievonen successfully promoted the development of clean fuels as well as Finland’s bioeconomy strategy in advancing renewable transportation fuels. He has also been involved with organizations such as Fortum Board, SSAB, Nynäs AB, Ilmarinen, and the HE Finnish Fair Foundation. Until 2021, Mr. Lievonen was also Chairman of the Board of Directors at Fortum. He has been recognized for his admirable leadership and expertise, and in 2016 was awarded an Honorary Doctorate of Technology by the Aalto University Schools of Technology.

Dr. Françoise de Viron will serve as non-independent Director, Chair of the ESG Committee and Vice-Chair of the Board. She is currently a director of the Solvay Board, appointed in 2013. Ms. de Viron is a regarded academic leader and has extensive experience in innovation, R&D and qualitative research. She is a Professor Emeritus at the Faculty of Psychology and Education Sciences and Louvain School of Management at UCLouvain in Belgium where she has been an Academic Member of various groups at UCLouvain. Ms. de Viron previously served as the president of AISBL EUCEN – the European Universities Continuing Education Network. Prior to her university position, from 1985 to 2000, she was in charge of developing Artificial Intelligence applications at Tractebel S.A. (now Tractebel-Engie).

Roeland Baan will serve as independent Director. He currently serves as President and Chief Executive Officer of Topsoe, a privately-held leading provider of clean energy and petrochemical technologies. He is also Chairman of the Supervisory Board of SBM Offshore NV. Roeland Baan has extensive experience in supply chain management, M&A, business development and operations management. Prior to joining Topsoe in 2020, he was President and CEO of Outokumpu and has held several executive roles at global organizations such as Aleris International, ArcelorMittal and SHV NV. He spent over 16 years in various roles across the globe at Shell, living in South America, in Africa and in the United Kingdom.

Edouard Janssen will serve as non-independent Director. He is currently a Director on the Solvay Board, appointed in 2021. Earlier this year, he was appointed Chief Financial Officer of D’Ieteren Group, a European leader in automotive distribution services. Mr. Janssen is also a Board member of privately-held Financière de Tubize and Union Financière Boël, as well as Co-Founder and Chair of Trusted Family. Mr. Janssen is active in academics, as Vice-Chair of the International Advisory Board of the Solvay Brussels School of Economics and Management and on the advisory board of the INSEAD HGIBS. He brings expertise in finance, strategy, entrepreneurship, business management, planning and marketing. He has served as Solvay’s Vice President in strategy and M&A between 2019 and 2021, and prior to that, he was the US-based General Manager for North- and Latin America at Solvay’s Aroma Performance Global Business Unit.
 
Dr. Mary Meaney will serve as non-independent Director. She is currently a member of the Board of Directors and of the Audit Committee of Groupe Bruxelles Lambert SA. She also sits on the Board of Directors and the Remuneration Committee of Beamery, the privately-held talent management company. She is a member of the Board of Directors and of the Finance Committee of Imperial College, London.Dr. Meaney will bring expertise in Strategy, M&A, and change management, which she acquired over a 24-year career at McKinsey. She was a Senior Partner, served on the McKinsey Shareholders Council and led McKinsey’s global Organization practice.

Nadine Leslie will serve as independent Director and is based in the United States of America. She is currently a member of the Board of Directors of Provident Financial Services , as well as a Non-Executive Director of Seven Seas Water Corporation, a water and wastewater treatment multinational company. She also sits on the Board of Trustees of Hackensack Meridian Health Network and is active as strategic consultant for civil engineering firm T&M Associates. Over a 22-year career at Suez, Ms. Leslie held several leadership positions, the last one being Chief Executive Officer of Suez North America, until 2022. Previously she served as Executive Vice President Health & Safety.

Freudenberg Performance Materials Apparel (Freudenberg) launches two advanced thermal insulation products made from low-level Bisphenol A (BPA) recycled PET fibers (rPET) into the global range of comfortemp®, Freudenberg’s thermal insulation brand.

The additions of DOWN FEEL WA 150LB and FIBERBALL WB 400LB to the comfortemp® global range serve as high-quality and ecologically-minded alternatives to down, enhancing the comfort and sustainability of your garments. DOWN FEEL WA 150LB is an extremely-lightweight, loose fiber thermal insulation with a super-light loft, while FIBERBALL WB 400LB uses clusters of extra-fine fibers to offer optimal breathability, maximum comfort, and minimal clumping after washing and drying.

GRS-certified and OEKO-TEX® STANDARD 100 Class I certifications
Both products utilize 100% GRS-certified rPET fibers, customizable to any desired fill levels. Additionally, these new products not only comply with but significantly surpass the stringent OEKO-TEX® STANDARD 100 Class I certifications. While OEKO-TEX® categorizes low-level BPA as less than 100 parts per million (ppm), these new products contain less than 1 ppm BPA, a testament to Freudenberg’s unyielding standards.

DOWN FEEL WA 150LB and FIBERBALL WB 400LB are available globally and more low-level BPA thermal insulation options are available in Asia.

adidas and IVY PARK unveil the final installment of their collaboration together, titled IVY PARK NOIR.
The new range represents a culmination of the two brands’ work together, combining adidas’ athletic and functional excellence, with IVY PARK’s signature emphasis on shape, and trend-defying creative vision. Using a singular, black color palette, IVY PARK NOIR intentionally draws focus to fabric, fit and texture, cultivating enduring elegance through sensual, material play.

Considering all chapters of an active way of life- from warm up, to cool down- the collection elevates one’s everyday pursuits through a mix of tight and loose fitting styles. Fabrications include luxurious embossed leather, exposed mesh and lacquered latex that combine to create a complex yet sophisticated capsule. Standout pieces include body-con cropped top and pant, relaxed 3-D molded knit sweatsuits, multifunctional jackets, and the IVY PARK signature jersey.

IVY PARK NOIR’s offering includes footwear that re-imagines a new era of style and function. Sleek molded and debossed elements add an architectural foundation to the collection’s sneakers, while a chunky, over the knee boot offers utilitarian fantasy.

Textil Santanderina, a manufacturer of quality fabrics with controlled traceability, launched its Advanced Black denim collection in collaboration with Archroma.

The Advanced Black collection by Textil Santanderina uses Archroma’s new DIRESUL® EVOLUTION BLACK LIQ dyestuff to produce on-trend authentic black denim apparel with sustainability and resource savings. In addition to allowing fashion and apparel brands to choose eco-friendlier alternatives that demonstrate their commitment to protecting people and planet, Textil Santanderina’s new Advanced Black denim range also offers unique shade and wash-down effects.

Based on synthesis technology developed by Archroma, DIRESUL EVOLUTION BLACK LIQ delivers an overall impact reduction to 57%*, measuring its effect on human health, ecosystems and resources compared to standard Sulfur Black 1 liquid. Unlike traditional synthesis processes, it does not produce any ammonia, sodium salts waste or liquid effluents, and water consumption in the synthesis process is reduced by 73% for massive savings. The new DIRESUL dyestuff, when adopted with the full Archroma coloration system, delivers a new black color with on-tone wash-down effect and cleaner effluent at the mill.

Textil Santanderina and Archroma previously collaborated to produce Textil Santanderina’s aniline-free** indigo denim collection with the use of DENISOL® PURE INDIGO.

*As determined by Ecoterrae, a leading Spain-based sustainability consulting firm, through a Life Cycle Analysis (UNE-EN ISO 14044:2006) at the synthesis stage, using the ReCiPe 2016 Impact calculation methodology.
**Below limits of detection according to industry standard test methods.

TRÜTZSCHLER Spinning presents an innovation for the textile machinery market: the high-performance comber TCO 21XL with 12 combing heads. For many decades, eight combing heads has been considered state-of-the-art in the spinning industry. Now, Trützschler’s advanced technology and engineering proves that it is possible to build a heavy-duty comber that maximizes productivity by 50 % and saves space without compromising on quality.

They say two heads are better than one, so just imagine what 12 heads can do! That’s the simple but effective idea behind the TCO 21XL. Increasing the number of combing heads by 50 % makes it possible to increase productivity by 50 %, enabling rates of up to 150 kg/h. As a result, two TCO 21XL combers offer the same production capacity as three conventional combers. And that means companies that buy and operate two machines instead of three can achieve significant benefits in terms of their price-performance-ratio (cost/kg). The costs of running the machines are broken down into 12 instead of eight heads, making the machine more cost-effective over its entire operating life.

50 % higher productivity is great – and it can be even greater if the machine is operated with JUMBO cans. The can changer needs to keep up with the extra performance, and JUMBO cans can easily collect the additional output of the TCO 21XL because they feature a 1200 mm diameter. This makes it possible to minimize non-productive time when changing cans. Anybody who is planning a new spinning mill knows that every square meter of space adds to the overall costs. The new TCO 21XL comber offers huge benefits in this regard because 25 % less floor space is required to operate same number of combing heads. This reduces the initial building costs, while also decreasing operating costs related to lighting, air conditioning and other overheads.

• Revenue of US$4B, a decline of 1% QoQ and 27% YoY
• Reported EBITDA of US$321M, an increase of 7% QoQ and decrease of 68% YOY
• Operating cash flows of US$491M
• Net Operating Debt to Equity of 0.95x
• Reported EPS of THB 0.04

Indorama Ventures Public Company Limited (IVL) reported marginally improved quarterly earnings as the company’s inherent advantages and continued focus on improving competitiveness helped bolster its business amid a continued weak operating environment.

Indorama Ventures achieved Reported EBITDA of $321 million in 2Q23, an increase of 7% QoQ and a decline of 68% YoY. Sales volumes remained resilient, rising 4% QoQ, amid continued destocking in the global chemicals industry from its peak in 4Q last year. Management is taking steps to conserve cash and safeguard the company’s competitive advantages as the global industry is impacted by increased capacity and lower margins with China boosting exports to offset muted domestic demand. Measures include redoubling efforts to reduce working capital and capex targeting $500 million of cash savings this year, optimizing the company’s European manufacturing footprint, and continued focus on Project Olympus, digitalization, and organizational enhancement.

Volumes are expected to improve in the second half of the year, with all three of Indorama Ventures’ business segments benefiting from the management measures and a gradual improvement in the outlook for the industry. Combined PET, the company’s largest segment, posted Reported EBITDA of $194 million, a 37% increase QoQ as destocking eased in most markets and supported stable volumes. Sales volumes are expected to grow in the second half of the year as manufacturing is optimized in Europe and expansion projects ramp up in India.

Fibers segment achieved Reported EBITDA of $20 million, a decrease of 37% QoQ, impacted by lower margins in the Lifestyle vertical and weak demand for Hygiene products in Europe. Volumes are expected to improve as manufacturing in Europe is optimized and expansion projects come online in the U.S and India. Mobility fibers volumes will see improvement in line with increasing automotive demand. Integrated Oxides and Derivatives (IOD) segment posted a 27% decline in QoQ Reported EBITDA to $94 million amid destocking in Crop Solutions market. Volumes will continue to be supported by reducing levels of destocking in the downstream portfolio.