Braskem(US:BAK)2022-03-17 19:25Financial Data and Key Metrics Changes - In 2021, Braskem reported a record high recurring operating result of $5.6 billion and net cash generation of R$10.7 billion [6][10] - The net profit for 2021 was approximately R$14 billion, a significant recovery from the accumulated losses of R$4.5 billion in 2020 [10][11] - The consolidated recurring operating result for Q4 2021 was around $1.1 billion, which was 23% lower than Q3 2021, primarily due to lower international spreads for main chemicals [9][10] Business Line Data and Key Metrics Changes - In Brazil, the recurring operating result for Q4 2021 was $761 million, with an annual result of $3.6 billion [12] - The utilization rate of petrochemical crackers in Brazil increased to 85%, up 6 percentage points from Q3 2021, driven by higher feedstock supply and stronger demand [11][12] - In the United States, the PP plants operated at a utilization rate of 73%, down 21 percentage points due to scheduled maintenance [14] - In Mexico, the utilization rate was 81%, increasing 13 percentage points, with sales volume up 20% year-over-year [15] Market Data and Key Metrics Changes - The company experienced a 13% increase in exports from Brazil, reflecting higher product availability [12] - The sales volume in the United States decreased by 2% to 442,000 tons in Q4 2021 [15] - The recurring operating result for the U.S. and Europe segment in Q4 was $281 million, with an annual result of R$1.6 billion [15] Company Strategy and Development Direction - Braskem aims to expand its Green PE production capacity to 1 million tons by 2030 and is focusing on recycling and productivity improvement [28][29] - The company is committed to maintaining a robust cash position and a long debt maturity profile, with a focus on efficient capital allocation [20][21] - Braskem is working on a repurchase program for shares, considering feedback from investors [40][41] Management's Comments on Operating Environment and Future Outlook - Management expects spreads to return to normal levels but remain above historical averages, with potential volatility due to geopolitical events [31][32] - The company anticipates a stable production and sales volume in Brazil, with higher PE production expected in Mexico [26] - Management highlighted the importance of maintaining a strong cash position and the potential for additional dividend payments throughout the year [41][52] Other Important Information - Braskem's CapEx for 2021 was $691 million, with an estimated $1.2 billion for 2022, focusing on maintenance and growth projects [25][26] - The company has made significant progress in its ESG agenda, including advancements in environmental, social, and governance initiatives [7][21] Q&A Session Summary Question: Can you explain the impact of spreads and when it will affect the bottom line? - Management indicated that spreads are expected to normalize but remain above historical averages, with volatility anticipated due to geopolitical factors [31][32] Question: What is the rationale behind the CapEx guidance? - Management clarified that the increase in operating CapEx reflects both maintenance and innovation investments, with a baseline maintenance CapEx of $600 million [35][36] Question: What is the rationale for the dividend figure announced? - The decision to suggest a lower dividend figure was made to allow for potential share repurchase programs in the future [40][41] Question: Can you provide updates on the Alagoas geological event provisions? - Management stated that the overall provision for the Alagoas issue is around R$12 billion, with no significant risk of changes to the current provisioning [43][45]