European Acquisition & Margin Improvement Spurs Record Net Profit in 6M, 2008 of Baht 1,588 Million

BANGKOK, August 14 /PRNewswire-FirstCall/ -- The Polyester demand growth continues from all regions and on the back of this industry fundamental, IVL continues its strategy to carve for its self a leadership position in the Polyester value chain consisting of PTA, Polyester and PET. In line with its vision to be a leading industry participant, IVL is in discussions to combine its business with Europe's largest Polyester group 'La Seda de Barcelona' listed on the Spanish stock exchange. Mr S.P. Lohia, stated:

"The business combination of Indorama and La Seda will create a world class company in this otherwise fragmented industry where the cost of petrochemical feedstock has eroded the margins to an uncomfortable level, and only with differentiation, scale and efficiency will companies be able deliver an adequate return on capital." Mr Lohia further stated that "Indorama's strength in operations management and its differentiated asset quality together with the scale and product portfolio that La Seda can contribute has the potential to create a sustainable and strong enterprise that will go on to serve its stakeholders in a rewarding and above average manner".

IVL subsidiary Indorama Polymers PCL (IRP) demonstrated stellar results in the high growth business of PET polymers and proved its ability to lead a global organization built on both low cost acquisitions of previously under-performing assets as well as its competitive organic expansions which helped the company to increase its business margin in the year 2008.

Sales volumes in 1st half 2008 were higher by 58%, revenues by 78% and net profits by 210%. The high growth is a result of successful completion of growth initiatives including the recent acquisitions in Europe and management focus on efficient operations and cost optimization.

IRP reported record revenues of $ 593.4 million (Baht 19,215 million) vis-a-vis $ 332.8 million (Baht 11,697 million) in 6M, 2007 resulting from sales volume growth of 58%. The consolidated net profit after tax of $ 49.0 million (Baht 1,588 million) vis-a-vis $ 15.8 million (Baht 509 million) in 6M, 2007 resulting from higher margins and a value gain of $ 28.7 million (Baht 930 million) from the low cost acquisition of assets in Europe.

IRP 1st half results were well supported by record quarterly revenues of $ 373.8 million (Baht 12,085 million) vis-a-vis $ 172.5 million (Baht 5,994 million) in Q2, 2007 resulting from sales volume growth of 90%. The quarterly consolidated net profit after tax of $ 13.3 million (Baht 429 million) vis-a-vis $ 9.8 million (Baht 302 million) in 6M, 2007 resulting from higher margins.

IVL is delighted with IRP 1st half results in the context of the current global market conditions and congratulates the management for its vision and:

    - Ability to improve spreads and pass through cost push resulting from
      record high crude prices in Q2, 2008

    - To successfully grow through well thought out acquisitions as well as
      setting up Greenfield and Brownfield expansions that differentiate the
      group from its peers. The IRP groups next differentiation is expected
      from the startup of its Co-located PET facility in Alabama, USA in 2009
      which will employ the latest state of art MTR technology

    - Increase market share and achieve sales volume growth of 58% during a
      period of lower GDP growth raising IRP current ranking to 4th in the
      world.

IVL is a privately held company incorporated in Thailand. IVL has substantial interests in the Polyester value chain consisting of PTA, PET and Polyester company's. IVL does not publish its financial information to the public but only of its listed subsidiary - IRP.

IRP ( http://www.indoramapolymers.com ) is a listed entity on the Stock exchange of Thailand with global operations and is the worlds 4th largest producer of PET, a packaging material used in beverages and food and growing at a healthy rate of -8%.

For further information, please visit our website http://www.indorama.net

SOURCE Indorama Ventures LTD