Interview with Richard Jones

Face2Face
Richard Jones
Richard Jones
Vice-President (Investor Relations & Corporate Communications)
Indorama Ventures
Indorama Ventures

What are the top achievements during the last five years of this decade?

Indorama Ventures has made significant progress over the past years. Notable achievements include: 

167 per cent growth in the size of the company in last 5 years: A capacity growth from 3.3 MMT in 2010 to 8.8 MMT in 2015 (including India) with a target of 11.8 MMT in 2018, further growth of 25 per cent over 2015. While we are today the largest PET producers in the world, it is our goal to become one of the top 20 chemical companies in the world by 2020. 

Advancing towards High Value-added (HVA) Segment: We have expanded from being a pure commodity company to having a substantial high value-added (HVA) differentiated business including recycling products which accounts for 33 per cent of revenues and 45 per cent of EBITDA. 

Acquisitions: Acquisitions of well-known polyester specialty businesses like America's Invista and Germany's Trevira, both descendants of Hoechst, as well as the acquisition of a manufacturer of high value-added polypropylene fibres and yarns for hygiene applications, FiberVisions, have been a game-changer for Indorama Ventures since 2012. These acquisitions facilitated the entry of Indorama Ventures into the branded specialist business and provide access to outstanding research and development facilities with accompanying intellectual property. We see growing opportunities for technical and automotive applications, both for staple fibres and for filaments. The acquisition of a manufacturer of Nylon 6.6 Polyamide fibres and yarns, PHP fibres, provides us with a horizontal entry into technological yarns used in air bags and tire cords for automobiles. These achievements are significant and have made Indorama Ventures headway on the HVA front.

Other important element of our HVA portfolio is recycled PET and fibres. Entering the recycling space in 2011 with the acquisition of Wellman Europe, Indorama Ventures today has eight recycling platforms across three continents. We are well positioned to take advantage of the increasing demand for recycled content in premium applications.

Our investments into HVA products over the past few years are delivering positive returns due to premium margins that they command over necessities and due to the barriers to entry that we have created for ourselves.

Please share details of your last fiscal and the growth percentage from 2010-2015?

There has been 167 per cent growth of capacity in 2015 over 2010 and a growth of 17 per cent in 2015 over 2014 (including India).

Which businesses has Indorama vertically and horizontally integrated into in the last 5 years?

We have completed integration both vertically and horizontally into MEG, PTA, PET resin, polyester fibres and yarns and HVA products. We believe that integration enhances our operating efficiency, competitiveness and responsiveness to customers and market developments, as well as allowing stability in volumes and profits. 

Expanding presence and entry into the EO/EG business: Expanded our presence in 62 countries now (including Cepsa Spain) and also expanded our business vertically into MEG segment (part of EOEG), which is one of the main raw materials for our downstream products, by acquiring the largest single EO/EG production facility in the US. Indorama Ventures' integration into MEG adds value to US PET and polyester margin chain. 

We are also focused on the consolidation of businesses acquired to bring about significant gains from synergies and as well from new products by leveraging on our industry leading innovation platform. We also took on some major initiatives at our Trevira fibre facility in Europe, including a consolidation from two sites to one, additional productivity improvements and a refocus towards specialty products. 

Moving forward, our strategy will focus on going further into ethylene and paraxylene raw materials, in line with our downstream polyester and other feedstock (PTA and MEG) capacities.

Published on: 07/10/2016

DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.

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