CCM: Adisseo methionine business boosts revenue in 2015 05-03-2016

In April 2016, Adisseo announced rise in net profit in its full-year 2015 financial figures, thanks to the exchange of major assets and company restructuring. Meanwhile, its animal nutrition business also recorded YoY rise, due to the lower production cost and rising market price of methionine. In 2016, the company’s larger sales contributed to its upward financial performance, despite the falling market price of methionine. Thus, Adisseo plans to take its advantages in supply for larger sales in the later period.

 

On 14 April, 2016, Bluestar Adisseo Company (Adisseo) released its financial figures in full-year 2015.

  • Revenue: USD2.35 billion (RMB15.17 billion), down by 22% YoY
  • Net profit: USD236.69 million (RMB1.53 billion), up by 4% YoY


The rises were mainly attributed to Adisseo’s exchange of major assets and company restructuring.


On July 27, 2015, the company:
1. Acquired 85% of the shares in Bluestar Adisseo Nutrition Group Ltd. (Bluestar Adisseo)
2. Transferred all Bluestar New Chemical Materials Co., Ltd. (Bluestar New Chemical, predecessor of Adisseo)’s rights and obligations of assets to China National Bluestar (Group) Co., Ltd. (Bluestar Group), deducting the assets sold and other dues (USD258.73 million – RMB1.67 million)


                       

 
This asset exchange enhanced Adisseo’s profitability. Bluestar New Chemical’s new chemical material business recorded severe financial loss: nearly -USD123.87 million (RMB800 million), with 0% gross profit margin in H1 2015 (all its businesses after 30 June 2015 were exchanged out). The acquisition of the shares in Bluestar Adisseo eased these losses. Finally, Adisseo realized a turnaround in financial performance in 2015, thanks to its health and nutrition business.


After this restructuring, Adisseo’s main businesses transformed from new chemical materials to the R&D, production and sales of feed additives for animal nutrition, main products covering functional products, specialty products, and other animal feed additives.

 

Adisseo's financial performance by product, 2015

Product

Revenue, million USD

YoY change, %

Operating costs, million USD

YoY change, %

Gross profit margin, %

YoY change, percentage point

Functional products

1,596.50

28

771.21

-4

52

+17

Specialty products

213.81

10

95.37

-8

55

+9

Others

79.07

-12

53.39

-13

32

+1

Subtotal

1,889.38

23

919.97

-5

51

+14

New chemical materials

432.48

-66

430.63

-65

0

-1

Note: Functional products: mainly methionine, vitamins, ammonium sulfate and sodium sulfate;
Specialty products: mainly enzymes preparation, rumenprotected methionine and organic selenium additives;
Others: mainly carbon disulfide, sulfuric acid and services of processing powder.

Source: Bluestar Adisseo Company

 

In 2015, Adisseo’s health and nutrition business recorded YoY rises.

  • Revenue: USD1.89 billion (RMB12.20 billion), up by 23% YoY
  • Net profit: USD433.90 million (RMB2.80 billion)
  • Gross profit margin: 51%, up by 14.5 percentage points YoY


“These rises were mainly because the shortage in methionine boosted its market price to an extraordinarily high level, while the fall in oil price reduced the production costs,” analyzed Adisseo.


Functional products, including vitamin A and methionine (65%+ of the total), are the leading part in the overall health and nutrition business:

  • Revenue: USD1.60 billion (RMB10.31 billion), up by 28% YoY


Methionine was the vital contributor for this rise. In H1 2015, the short supply of methionine boosted the market price, and further, the sales of Adisseo’s functional products. According to CCM’s price monitoring, China’s market price of methionine reached USD11,394/t in April, hitting a record high.


Meanwhile, thanks to the falling price of oil (raw material for methionine) and strict control, Adisseo’s operating costs fell by 4% to US.

 

Adisseo's sales distribution of health and nutrition business, 2015


Source: Bluestar Adisseo Company

 

Global production capacity distribution of methionine, 2015


Note: Evonik short for Evonik Industries AG;

Bluestar Adisseo short for Bluestar Adisseo Nutrition Group Ltd.;

Novus short for Novus International, Inc.;

Sumitomo short for Sumitomo Chemical Co., Ltd.;

CJ short for CJ Group Co., Ltd.;

NUTM short for Ningxia Unisplendour Gas Chemical Co., Ltd.

Source: Bluestar Adisseo Company

 

Notably, in Q1 2016, Adisseo continued its upward financial performance, despite the falling market price of methionine. According to CCM’s price monitoring, China’s average market price of powder methionine decreased by 38% YoY to USD4,547/t in Q1. However, the company’s net profit was reported a YoY increase of 16% to USD86.81 million (RMB561 million).


This increase was mainly thanks to its larger sales.


According to the annual report, Adisseo has been the second largest methionine producer in the world, with its global market share rose from 23% in 2012 to 27% in 2015. In 2016, the company’s 140,000 t/a liquid methionine project has been capable of producing at full capacity, which will be favorable for its further market expansion.


At present, Adisseo’s total production capacity of methionine achieved 360,000 t/a. In particular, its 140,000 t/a liquid methionine project was constructed in Nanjing, China. Altogether, the company has 6 production bases, located in France (Commentry, Les Roches, Roussillon, and La Rochelle), Spain (Burgos) and China (Nanjing) respectively.

 

* This article comes from Amino Acids China News 1604, CCM.

 

          

 

About CCM:

CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc.

 

For more information about CCM, please visit www.cnchemicals.com or get in touch with us directly by emailing econtact@cnchemicals.com or calling +86-20-37616606.

 

Tag: methionineAdisseo

  

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