Houston, Texas – Orion Engineered Carbons' rubber blacks unit has posted a 9.3% decline year-on-year decline in net sales to $188.3 million for the fourth quarter of 2020.
Fourth quarter earnings (adjusted EBITDA), meanwhile, decreased 13.8% year-on-year to $27.1 million, driven by higher fixed costs and the impact of lower feedstock costs, the group reported 18 Feb.
Rubber carbon black volumes came in 2.4% down on the prior-year level mainly due to the continued impact of the global pandemic om demand from tire customers.
The year-on-year volume decline also reflected the impact of a 2019 commercial strategy at Orion aimed at raising price over volume, the group pointed out.
The net sales decline, it added, was primarily due to pass-through of lower feedstock costs to customers and, to a lesser extent, lower volumes, partially offset by base price increases.
For the group as a whole, final-quarter net sales came in 2.2% lower year-on-year at $315.7 million while earnings (adjusted EBITDA) increased 4.4% to $66.0 million.
Full-year net sales fell 3.2% to $1,136.4 million across Orion, while earnings (adjusted EBITDA) of $200.0 million, were $67.3 million below the level recorded for 2019.
Reviewing the year, Orion CEO Corning Painter said: “We successfully navigated 2020 and finished strong, with fourth quarter adjusted EBITDA exceeding prior year levels and reflecting strong profitability levels.”
Orion declined to give earnings guidance for 2021, citing continued uncertainty around the development of the Covid-19 crisis at the current time.
“Our 2021 planning scenario assumes that Covid-19 does not functionally end until 2022, with 2021 specialty and rubber volumes roughly resembling second-half 2020 run-rates,” said Painter.
“Most important to us is to always be improving our agility, to never sit still, but build on 2020 and push ourselves so we can respond even better to any demand scenario,” the CEO concluded.