From the Sector

• Sales Volume rose 3% QoQ and 2% YoY to 3.55MT
• Adjusted EBITDA of $366M, a rise of 32% QoQ and a decline of 2% YoY
• Operating cash flows of $184M
• Net Operating Debt to Equity of 1.12
• Reported EPS of THB0.17

Indorama Ventures Public Company Limited (IVL) reported an improved quarterly performance as the prolonged destocking trend showed further signs of easing. During the quarter, the company progressed its IVL 2.0 evolved strategy to enhance earnings quality and transform its business to emerge stronger from the downturn in global chemical markets.

Indorama Ventures’ reported Adjusted EBITDA1  of $366 million in 1Q24, a 32% increase QoQ and a 2% decline YoY. Sales volume grew 3% QoQ as the widespread customer destocking that sapped demand through 2023 shows signs of a gradual recovery across all sectors, partially offset by a winter freeze in the U.S. The result was supported by lower utilities costs in Europe, Red Sea-related supply chain disruptions that benefited the company’s import parity advantages, and favorable shale gas economics that bolstered profitability in the U.S.

Indorama Ventures expects the recovery in volumes to continue through 2024, albeit at a gradual pace as destocking normalizes and the approaching summer supports demand. However, the overall landscape for the global chemical industry remains challenging due to excess capacity builds, as well due to persistent inflation and high interest rates which weigh on industry spreads and continue to impair profitability, especially across the polyester value chain. Our HVA segment ‘Indovinya’ is progressing well into the second quarter post the easing of destocking and anticipating a healthy 2024.

The company’s experienced management remains intensely focused on managing costs, optimizing competitiveness, and maintaining high liquidity. Indorama Ventures’ diverse geographical footprint is a key advantage in the current low-margin environment, allowing its businesses to maintain their strong market premium, supported by protection from trade and non-trade barriers.

In 1Q, the company made headway with its IVL 2.0 three-year plan to leverage its global leadership position and forge a new era of opportunity amid significant structural changes in chemical markets. Under the evolved strategy, which the company outlined at its annual Capital Markets Day in March, Indorama Ventures is optimizing assets, reducing debt, and focusing on generating free cash flow to deliver enhanced shareholder returns. Today, 70% of the company's revenue has deployed the SAPS/4HANA ERP and is using the infrastructure to enhance digital procurement, sales excellence, and integration of supply chains across the business. The company believes these AI tools will improve productivity and costs, as well as release working capital in line with its modernization strategy.

As part of IVL 2.0, the company is optimizing 7 sites, including the ongoing evaluation of its PTA/PET operation in the Netherlands. It has also made significant progress in its program to refinance $1.1 billion of debt within the first half of 2024 to ensure ample liquidity. Recent capital raisings include a $255 million ‘Ninja loan’, a THB 10 billion debenture, a $100M bi-lateral loan, and this week’s successful close of a $500 million syndicated loan – achieved at lower-than-average spreads compared to previous issuances.

To unlock value, Indorama Ventures is preparing its packaging and surfactants businesses for IPOs. From 1Q24, the Indovinya segment (previously named ‘Integrated Oxides and Derivatives’) is focused on developing its attractive downstream surfactants operations as a separate segment. The segment’s Intermediate Chemicals business, consisting of shale base integrated Ethylene MEG, MTBE and merchant Purified EO assets, have been moved under the Combined PET (CPET) segment where they are a natural fit.

Segment Performances
In 1Q24, CPET segment (including Intermediate Chemicals) posted Adjusted EBITDA of $249 million, a 34% gain QoQ and 4% YoY as supply chain disruptions and a consequent spike in global ocean freight rates supported high prices and margins, and as Western markets benefited from lower energy costs. The Indovinya segment reported a stable Adjusted EBITDA of $70 million, impacted by the winter freeze in the U.S and a mini turnaround at a PO/PG plant. The Fibers segment achieved a remarkable 73% increase in Adjusted EBITDA to $39 million QoQ, and 2% YoY, as destocking waned across all three business verticals and drove an 8% QoQ increase in volume.

• GOTS Version 7.0 released
• GOTS certified entities grow by 8% and expand to 89 countries
• GOTS releases Due Diligence Handbook for certified entities
• Farm-Gin Registry implemented in India, creating a direct link and better evaluation of incoming data
• GOTS collaborates with European Space Agency and Marple for AI organic cotton project
• #Behindtheseams campaign reaches 21 million+ unique individuals

The Global Organic Textile Standard (GOTS), managed by non-profit Global Standard, recognises 2023 as a year of significant milestones. From expansion of GOTS-certified facilities to the release of a new standard version, GOTS remained a beacon for businesses navigating changing legislation, social and environmental demands.

Coming out of one of the strongest years for GOTS, 2023 culminated with 25 GOTS-approved certification bodies reporting a noteworthy 14,676 certified facilities (an 8% growth from 2022) in 89 countries.

Ushering in GOTS Version 7.0
As of 1 March, facilities that become GOTS-certified will operate under the new GOTS Version 7.0, released in March 2023 with a one-year transition period. GOTS Version 7.0 and its accompanying Implementation Manual provides a comprehensive solution for companies who want to produce organic textiles and be supported to ensure compliance with environmental and human rights due diligence along the entire value chain, from field to finished product.

GOTS Version 7.0 also introduced a six-step due diligence process and handbook that equips GOTS-certified operations to proactively identify, assess and mitigate adverse impacts throughout their value chains.

Looking to the future
GOTS initiated in 2023 two major projects in India, the globe’s largest producer of organic cotton. The Farm-Gin Registry was introduced for the 2022-2023 harvest season, which acts as a link between farm and gin and is a tool to strengthen integrity by collecting organic raw seed cotton data producing farm or farm group.

GOTS, the European Space Agency (ESA) and software company Marple launched a new project that aims to show the potential for remote satellite monitoring of organic cotton cultivation systems. The project trained artificial intelligence (AI) to use ESA satellite data to detect cotton fields across India and automatically classify them according to their cultivation standard. By integrating standardised yield metrics, this innovative approach will enable GOTS to generate realistic estimates of organic cotton yields in specific areas. In addition, the project is expected to empower GOTS to recognise cotton fields that have not yet obtained organic certification but possess the potential for a transition to organic cultivation. The first results of the project will be announced in June.

Educating the consumer
GOTS, in its ongoing commitment to stakeholder education, orchestrated in November an immersive 360-degree awareness and educational campaign. Successfully engaging both consumers and industry professionals, the initiative shined a spotlight on GOTS-certified companies and their products, which empowered consumers to make more conscientious choices while shopping. With an impressive turnout of over 250 certified entities, the campaign made a significant global impact, reaching more than 21 million unique individuals worldwide.

Cascale, a non-profit alliance for driving impact in consumer goods (formerly the Sustainable Apparel Coalition), announces Colin Browne as its new Chief Executive Officer, effective May 1, 2024.

Browne previously served as Interim CEO and Chief Operating Officer of Under Armour, a Cascale member. During his tenure at Under Armour, Browne oversaw sustainability efforts and, in addition, led significant transformations across supply chain, go-to-market and technology. In 2023, the company shared achievements related to its environmental footprint, product circularity, and renewable energy goals – some accomplished with Cascale’s Higg Index suite of tools.

Prior to joining Under Armour, Browne was managing director of Asia Sourcing for VF Corporation, a Cascale member that includes The North Face, Timberland, Vans, and Smartwool brands. In addition to his experience leading brands, Browne also spent four years running manufacturing plants in Thailand and began his career at Bally Shoe factories in the UK. He has lived and worked in the UK, South Korea, mainland China, the Philippines, Thailand, Hong Kong SAR, and the USA; his international experience and localized approach underscore his commitment to Diversity, Equity, and Inclusion (DEI) both in and outside of the workplace. Browne also served as the Chairman of the American Apparel and Footwear Association and was on the board of the World Federation of Sporting Goods Industries. As a member of the Worldly Board, the leader in environmental and social impact data for the apparel and footwear industry and the exclusive platform for Cascale’s Higg Index tools, Browne will ensure a unified approach to advancing sustainability initiatives across both organizations.

During his first 100 days with Cascale, Browne will connect with the organization’s 300+ members across the value chain, emphasizing manufacturer engagement and relationship building. He will also engage Cascale’s broader ecosystem of stakeholders including NGOs, governments, and academia. Browne is personally committed to Cascale’s vision to lead the consumer goods industry to combat climate change, foster decent work for all, and build a nature-positive future.

CARBIOS celebrated the groundbreaking ceremony for its PET biorecycling plant in the presence of representatives of local authorities, partner brands and industrial partners who all make up CARBIOS’ ecosystem. Located in Longlaville, in the Grand-Est region of France, CARBIOS' first commercial plant will play a key role in the fight against plastic pollution, offering an industrial-scale solution for the enzymatic depolymerization of PET waste in order to accelerate a circular economy for plastic and textiles. The plant will have a processing capacity of 50kt/year of prepared waste when operating at full capacity. Work is progressing on schedule with significant quantities delivered to customers in 2026.

CARBIOS' technology enables PET circularity and provides an alternative raw material to fossil-based monomers, giving PET producers, waste management companies, public bodies and brands an effective solution to meet regulatory requirements and their own commitments to sustainable development. The plant will have the capacity to process 50,000 tons of prepared PET waste per year (equivalent to 2 billion colored bottles, 2.5 billion food trays or 300 million T-shirts). The plant will create 150 direct and indirect jobs in the region. In October 2023, CARBIOS obtained the building and operating permits for the site. The factory is currently under construction on land officially acquired from Indorama Ventures on 14 February 2024. In February 2024, CARBIOS and De Smet Engineers & Contractors (DSEC) announced their collaboration to manage construction. Several feedstock supply agreements, notably with CITEO and Landbell Group, will secure the vast majority of the raw materials required.  Close to the borders with Belgium, Germany and Luxembourg, the plant's location is strategic for access to nearby waste supplies

Companies, designers, architects and agencies worldwide are now invited to submit their products and projects for the German Design Awards 2025. The German Design Awards by the German Design Council honours projects that are pioneering in the German and international design landscape and highlights positive developments in circular design. The award not only makes success visible, but also opens up a network, international reach and additional market opportunities for the award winners. Application deadline is 6 September 2024.
 
Whether digitalisation, AI or circular design - the German Design Award platform reveals the contribution that design can make to the sustainable transformation of the economy. Now more than ever, outstanding design can provide answers to the challenges of our time, focussing on the impact of products and services on the planet and our society - through multi-perspective approaches, sustainable and circular design processes or resource- and environmentally friendly production. The German Design Award has set itself the goal of promoting the diverse transformation tasks of our time through design and providing orientation for others through outstanding examples.

Focus on circular design
Starting this year, companies and designers can submit their projects in an additional category called "Circular Design". This category recognises particularly innovative solutions that implement the current objectives of the circular economy and provide inspiring impulses.

The  international jury of the German Design Awards honours these pioneering design achievements in three main categories: "Excellent Product Design", "Excellent Communications Design" and "Excellent Architecture".

New category
To visualise pioneering developments in architecture through the influence of artificial intelligence and digital design methods, designers and developers can submit projects, service designs and virtual architectures in the "AI in Architecture and Metaverse Space Design" category from this year onwards.

Access to the American market
The German Design Council has entered into an exclusive TV partnership with CBS/Paramount's new US documentary series Europe ByDesign, offering German Design Award winners far-reaching opportunities to position themselves on the US market. You can present your work in the next season of Europe ByDesign, which will be broadcasted in prime time on CBS in the USA as well as streamed worldwide.
 
Important dates at a glance

• Call for entries: 23 April 2024
• Register at the Early Bird price: until 21 June 2024
• Deadline for grant applications: 30 August 2024
• Registration deadline: 6 September 2024
• Jury meeting: 26 and 27 September 2024
• Awards Show: Beginning of February 2025

The transition towards safer and more sustainable chemicals is progressing in some areas, while in others, it is just beginning. This is the finding of a first, joint Europe-wide assessment of the drivers and impact of chemical pollution by the European Environment Agency (EEA) and the European Chemicals Agency (ECHA). The benchmarking found that more work is still needed to reduce the impact of harmful substances on human health and the environment.

The number of industrial chemicals scrutinised under the EU’s chemicals legislation to determine their safety has increased substantially. Authorities now have much better knowledge about the hazardous properties of chemicals that are used across the EU, resulting in many actions to minimise and control the risks of several groups of substances.

According to the joint EEA-ECHA synthesis report on the EU indicator framework for chemicals, the overall use of the most harmful chemicals (in particular those that are carcinogenic, mutagenic and reprotoxic) is still growing but more slowly than the overall chemicals market growth. Pressure is increasing to avoid the use of so-called substances of concern and to implement the principles of the safe and sustainable by design framework.

There is a need to more effectively ensure that consumer products do not contain the most harmful substances, for example chemicals that are endocrine disrupting, that negatively affect the hormone system, or substances that are persistent, bioaccumulative and toxic, which present a risk for years to come even after their use has ceased.

More data and information are needed to better understand human and environmental exposure to those most harmful chemicals and their impacts. Still, the indicators show clearly that the shift to safe and sustainable chemicals must continue and should even be accelerated.

The report is based on a set of 25 key indicators, which monitor the drivers and impacts of chemical pollution in Europe.

Key findings

• Transition towards safer and more sustainable chemicals is progressing in some areas while in others it is just getting started.
• Action by authorities and industry has supported minimising and controlling the risks from several groups of hazardous chemicals. Efforts are ongoing to increase knowledge on chemical hazards and support risk management action where needed.
• Available data suggest that there is little evidence of progress towards eliminating substances of concern from waste and secondary materials. This is a barrier to the transition towards a more circular economy.
• Emissions of certain chemicals to water and air have fallen following specific EU regulations (e.g., on industrial emissions) and international actions, but further measures are needed to reach concentration levels that are not harmful for human health and the environment.
• Emissions from industry still lead to major costs in terms of damages to human and ecosystem health.
• Human biomonitoring offers the opportunity to understand human exposure to chemicals from multiple sources and thus health risks associated with chemical pollution. As such, biomonitoring forms a key tool to measure the effectiveness of chemicals legislation in protecting human health and the environment.

Stratasys Ltd. published its second Mindful Manufacturing™ ESG and Sustainability Report in accordance with the Global Reporting Initiative (GRI) standards, fulfilling its commitment to transparency. The report includes an extensive overview of activities and advancements in Stratasys’ environmental, social and governance (ESG) programs.

Some highlights of the Mindful Manufacturing ESG and Sustainability report, by category, include:

Environmental

• Stratasys reduced water intensity by 32.5 percent across global operations, leading to an overall reduction in water usage by the company.
• Solar panels installed at Israeli facilities generated 441,339 kWh of renewable energy, which contributed to 207 metric tons of reduced CO2 emissions, or the equivalent of planting 3,423 trees
• Double digit (11.3 percent) increases in the number of spools, cartridges and canisters recycled through a new recycling program.

Social

• More than 38,000 hours of employee training were provided, equaling 18 hours of training per employee.
• Approaching world-class status with employee engagement, with a 78 percent participation rate in the last all-employee survey, with an all-time high engagement score of 73.
• 81 percent of managers participated in management training.
• 4 diversity KPIs were set in 2022, focusing on hiring practices. Targets were:
• 100 percent of candidate slates for manager and above will have a diverse slate
• 35 percent of management hires will be women
• 25 percent of tech hires will be women
• 40 percent of intern/student hires to reflect a range of ethnicity and gender diversity.

Governance

• 100 percent of new suppliers in 2021 and 2022 signed the Supplier Code of Conduct, which includes environmental, social and ethical standards.
• More than 97% of all employees completed compliance training.
• No product-related health and safety incidents of non-compliance occurred in 2021 or 2022.

Two new research labs are being built by AkzoNobel at its Sassenheim site in the Netherlands to further propel the company’s product development.

Work is about to start on building a technology center for Powder Coatings, while a new polymer lab has just opened which will develop innovative resin technologies for all the company’s businesses.

The total investment in the Sassenheim site – AkzoNobel’s largest global R&D center – amounts to around €8 million. The facility already houses the biggest R&D teams in Europe for the company’s Decorative Paint and Automotive and Specialty Coatings businesses. The addition of the two new labs will help the company further build on its global reputation for product development focused on providing creative solutions for customers.

The recently opened polymer lab – part of the company’s Research organization – will accommodate 15 scientists. It will mainly focus on the development of more sustainable polymer technologies and new coatings to support AkzoNobel’s ambition to halve carbon emissions across the value chain by 2030.

AkzoNobel employs around 3,000 R&D professionals worldwide in 70 laboratories, with more than €1.25 billion having been spent on research and development over the last five years.

The John Lewis Partnership announces the appointment of Jason Tarry as its seventh Chairman following Sharon White’s decision to step down at the end of her term.

Jason brings over 33 years of experience at Tesco where he was most recently the UK & Ireland CEO, a role he held for six years. His experience spans grocery, general merchandise and fashion in senior commercial, operational and general management positions, having joined the Tesco graduate programme in 1990.

In addition to delivering market leading grocery performance in the UK, he led the expansion of F&F Clothing across Europe as Group CEO. Jason is expected to take up the role in September, at which point Sharon will step down and support the transition as required.

Rita Clifton, Deputy Chairman and Chair of the Nomination Committee, said: “The Board extends its huge thanks to Sharon for successfully leading the Partnership through one of the most testing periods in its history - first Covid and then the cost of living crisis. She has faced into the toughest decisions and overseen the Partnership's financial recovery; we are in good financial health with a return to profit, and have a strong balance sheet with record investment planned this year. Sharon has also helped ensure that employee ownership of the Partnership is secure, is demonstrably focused on its purpose as a force for good and with an open and inclusive culture.

“As the Partnership moves into the next phase of its modernisation focused on our core retail business as well future growth, we are confident that Jason will provide the kind of inspirational leadership, a proven track record in multi-channel, multi-category retail success and a strong identification with Partnership values that we are seeking in this role. Jason has impressed everyone throughout the interview process with his warmth, his belief in the Partnership’s ideals and democratic principles and his appreciation for our unique and special brands.”

With the aim to help the denim industry reduce the environmental impact of its wastewater and move towards circularity, Archroma, G-Star RAW and Advance Denim have renewed their joint commitment to the production of aniline-free denim apparel based on Archroma’s DENISOL® PURE INDIGO 30.

Their joint aim is to produce high-quality denim in authentic blue shades without the aniline impurity carried through from the synthesis of standard synthetic indigo. In traditional denim production, this aniline remains bound with the indigo pigment on the fabric; the remaining aniline is discharged during the dyeing and washing process. This can be a problem because aniline is toxic to aquatic life and two-thirds of aniline waste currently ends up in wastewater discharge where it could potentially pollute waterways and the ocean.

Archroma developed DENISOL® PURE INDIGO 30 to answer this key challenge. A 30% pre-reduced indigo solution, DENISOL® PURE INDIGO 30 makes it possible to produce indigo-dyed denim without aniline impurities throughout the process.

Easy to use with automated dosing, DENISOL® PURE INDIGO 30 reduces the water needed for preparation, washing and wastewater treatment compared to indigo grains. It also reduces hazardous chemical consumption while allowing high reproducibility and creating the authentic and iconic deep indigo shades traditionally associated with denim.

G-Star RAW is working towards making 20% of its entire collection from Cradle to Cradle Certified® fabrics by 2025. Its partnership with Archroma and Advance Denim contributes to this goal, since the aniline-free DENISOL® holds a Gold Level Material Health Certificate from the Cradle to Cradle Products Innovation Institute. DENISOL® PURE INDIGO 30 is also compliant with other eco-standards and the requirements of leading retailers and brands.

Advance Denim, G-Star RAW and Archroma have previously collaborated to launch collections based on Archroma’s EarthColors® technology, which upcycles plant waste from the herbal industry to create sustainable colorways.