INEOS GROUP HOLDINGS S.A.

Q2, 2023 Trading Statement

INEOS Group Holdings S.A. (‘IGH’ or ‘INEOS’) announces its trading performance for the second quarter of 2023.

Based on unaudited management information INEOS reports that EBITDA for the second quarter of 2023 was €387 million, compared to €943 million for Q2, 2022 and €444 million for Q1, 2023. The second quarter results were adversely impacted by non-cash inventory holding losses of approximately €136 million as a result of the large decline in raw material and product prices in the quarter.

High energy costs, particularly in Europe, and continued high inflation rates have led to reduced demand levels and erosion of margins from the previous strong performance in the first half of 2022.

O&P North America reported EBITDA of €202 million compared to €372 million in Q2, 2022. Ethylene markets were generally weaker in the quarter with lower demand, improved industry supply availability and reduced export opportunities. Polymer markets were softer with erosion of margins for most products in the quarter, although pipe markets remained solid.

O&P Europe reported EBITDA of €72 million compared to €223 million in Q2, 2022. Markets for olefins in the quarter were generally weaker with most industry crackers being trimmed across Europe. Propylene markets were soft with weak demand across most derivatives due to high energy costs. European polymer markets were long with reduced demand and increased levels of imports.

Chemical Intermediates reported EBITDA of €113 million compared to €349 million in Q2, 2022. Overall demand in the Oligomers business was solid across the product portfolio, with particular strength in co-monomers. Demand was weaker across most market sectors for the Oxide business, particularly the European glycol markets. Demand for the Nitriles business was mixed, with firm demand in the USA, but softer demand in both Europe due to high energy costs, and Asia due to improved industry supply.  Markets for the Phenol business were balanced in the USA, but weaker in Europe and Asia.

The Group has continued to focus on cash management and liquidity. Net debt was approximately €8.0 billion at the end of June 2023 (including the SECCO Term Loan and Project One Facility).  Cash balances at the end of the quarter were €2,059 million, and availability under undrawn working capital facilities was €579 million.  The Group provided a short-term loan facility of $0.9 billion to INEOS Industries, a related party, to partly fund their acquisition of US onshore oil and gas assets from Chesapeake Energy. It is expected that the loan will be repaid to the Group from the proceeds of a new reserves-based lending facility to be set up by INEOS Energy, together with the cash flows from the newly acquired business. Net debt leverage (excluding the SECCO Term Loan and Project One facility) was approximately 3.8 times as at the end of June 2023.