Univar sees demand return

THE RIGHT MIX

RESULTS • RETURNING DEMAND FROM INDUSTRIAL CUSTOMERS HELPED UNIVAR POST STRONG FIGURES AS IT PRESSES ON WITH ITS STRATEGIC PLANS

UNIVAR SOLUTIONS HAS reported adjusted net income of $97.4m for the second quarter, well ahead of last year’s $55.7m, with adjusted EBITDA rising from $163.2m to $197.5m. “We are pleased with another strong quarter of results based on the successful execution of our growing together strategy, the advancement of our Streamline 2022 (S22) programme, and market share growth,” says David Jukes, president/CEO.

“In a period of strong customer demand and constrained supply, we believe our operating infrastructure and ability to identify trends, grow our supplier and customer relationships, as well as build on investments in both digital and our growing global specialty end market verticals, has us well-positioned to support our customer and supplier partners.”

“As we enter the back half of 2021, we expect more normalised margins and continued market share growth as we keep the customer at the centre of all we do,” Jukes adds.

In the US, external sales increased by 28.3 per cent compared to a year earlier, primarily due to higher industrial end market demand and chemical price inflation. In Canada, sales fell by 28 per cent following Univar’s exit last year from the Canadian agriculture sector; adjusted EBITDA was down by just 0.8 per cent, again as a result of returning demand from industrial end markets and chemical price inflation. Similar conditions were experienced in the EMEA division, where sales were up by 23 per cent year-on-year, tempered only by the divestiture last year of Distrupol. Sales in Univar’s smallest division, Latin America, were up by 53.3 per cent, largely due to higher demand for products in industrial solutions as well as chemical price inflation.

The ongoing integration of the Nexeo acquisition continues, with Univar saying it expects to achieve the targeted $120m in net synergies by early 2022. It also says it made “significant progress” during the second quarter on its S22 programme, which is designed to improve operational agility, drive faster sales growth, particularly in North America, and maximise net free cash flow conversion. Under S22, Univar is focusing on improving adjusted EBITDA margins and reduce leverage.

OPENING IN CANADA Univar has also begun construction work on a new custom-designed facility in Abbotsford, British Columbia. The SAP-ready facility is expected to open during the first half of 2023 and aligns with Univar’s long-term sustainability commitment to achieve net-zero emissions by 2050, through the implementation of the latest emissions standards and innovative logistics and storage concepts, including a site-wide tank telemetry system for real-time product inventory visibility.

“Central to our Growing Together strategy is our customer, and the new Abbotsford facility will improve our ability to quickly and safely deliver products when and where they are needed with minimal carbon footprint, making us easier to do business with and helping us fulfil our purpose to keep communities healthy, fed, clean and safe,” says Chris Halberg, vice-president of Local Chemical Distribution for Univar Solutions in Canada. “We’re excited to build on our leading position in the British Columbia market with more growth opportunities for our suppliers to meet local customer needs.”

The new facility will offer larger storage capacity for chemicals and ingredients, alongside rail connections and specially designed blending rooms for solvents, corrosives and oxidisers. This will help make blending more efficient while reducing the risk of incidents by means of the latest engineering controls and state-of-the-art containment technology. www.univarsolutions.com

UNIVAR’S LATEST PROJECT IN CANADA WILL ALIGN