Braskem records record results in 2021 and returns to investment grade

Braskem closed 2021 with historic results, both in recurring operating results, net profit and cash generation. The year was also marked by a low level of leverage, the company's return to investment grade in the classification of risk agencies and advances in the ESG (environment, social responsibility and governance) agenda.

“It was a year of many challenges and achievements, in which we maintained our focus on people's safety, customer service and financial health. It was also marked by important socio-environmental advances that are helping to build the Braskem of the future. We reinforce our commitment to sustainability indicators, such as reducing CO2 emissions and increasing the portfolio of recycled and renewable products”, says Roberto Simões, president of Braskem.

In the fourth quarter of 2021, Braskem recorded recurring operating results of R$6,3 billion, 40% higher than the same period of the previous year. In the year, the recurring operating result was R$30,3 billion, 176% higher than in 2020. In the fourth quarter, net profit was R$530 million, closing the year with a total profit of R$14 billion . Free cash generation in the last three months of 2021 was R$3,1 billion, reaching a record R$10,7 billion for the year. Net sales revenue in 2021 also reached an all-time record of R$105,6 billion.

In this scenario, corporate leverage, measured by the ratio of adjusted net debt and recurring operating income in dollars, ended 2021 at 0,94x.

In December, the risk rating agency Fitch Ratings raised the Company's risk level on a global scale, regaining its investment grade rating. In September, Braskem had already regained investment grade by S&P Global Ratings (S&P).

Another highlight was the return to the B3 Sustainability Index (ISE), which reflects the Company's ongoing commitment to the best practices in corporate governance, social responsibility, economic-financial and environmental management. Braskem was also included in the CDP (Carbon Disclosure Program) ranking of leading companies in water and climate risk management for the seventh consecutive time, in addition to achieving the highest rating on the "Water List" for the fifth consecutive time, and remaining a leading company in the "Climate List" for the seventh consecutive time and in “Supply Chain” for the sixth consecutive time, reinforcing its engagement and positive impact on the topic.

The ESG agenda was highlighted, in November, by the signing of the memorandum of understanding between Braskem and Lummus Technology, a global leader in process technologies involving ethylene, petrochemicals, energy transition, among others, for the joint licensing of green ethylene technology from Braskem for two projects: one under development in North America and the other under analysis in Thailand.

The entry into operation in December of the first mechanical recycling line, the result of the partnership between Braskem and Valoren, was another milestone. The plant, located in Indaiatuba (SP), has the capacity to transform around 250 million packages into 14 thousand tons per year of high-quality post-consumer resin.

In 2021, Braskem participated in 146 social projects, which benefited more than 800 thousand people globally, including private social investments, donations, volunteer programs and initiatives to combat the pandemic. This social investment by the company reached almost R$40 million in the year.

From a social perspective, Braskem is recognized by the Forbes ranking as one of the best employers in the world, being one of the 3 Brazilian employers in the ranking of 750 participants.

Renewable energy

By 2021, Braskem has signed a total of five contracts for the purchase of renewable energy, which will avoid the emission of more than 220 thousand tons of CO2 per year, over 20 years, totaling more than 4,4 million tons of CO2 in the period.

Furthermore, Braskem and French company Veolia announced a joint investment of R$400 million to produce renewable energy from eucalyptus biomass in Alagoas. The project will generate 900 thousand tons of steam/year for 20 years, which will mean a reduction in emissions of approximately 150 thousand tons of CO2 per year. Furthermore, it will create more than 400 direct jobs during the construction phase and approximately 100 jobs in the operation (post-construction).

Finally, the Company acquired a minority shareholding in the Special Purpose Companies that generate wind energy Ventos de Santa Amélia and Ventos de Santo Abelardo, both controlled by FIP Salus of the Casa dos Ventos group. This share acquisition is in line with the Company's strategy of expanding the use of clean energy sources in its operations, inserting the Company into the renewable energy self-production regime.

Mexico and Alagoas

In Mexico, the utilization rate of polyethylene plants in the fourth quarter was 81%, an increase of 13 percentage points compared to the previous quarter and 34 percentage points compared to the fourth quarter of 2020. This was due to the record quarterly imports of ethane from the USA through the Fast Track solution and the increase in the supply of ethane by the Mexican state-owned oil and gas company, Pemex, in line with the volumes established in the amendment to the ethane supply contract signed in October 2021. Additionally, the The Boards of Directors of Braskem Idesa and Braskem approved the investment of US$400 million for the construction of an ethane import terminal in Mexico.

In Alagoas, work continues on the Financial Compensation and Relocation Support Program, which is the result of an agreement between Braskem and Alagoas authorities to assist the population affected by the geological phenomenon in Maceió.

By February 2022, more than 14 thousand properties had already been vacated, exceeding 97% of the total area defined by Civil Defense. More than 13 thousand compensation proposals were presented, with 99,5% acceptance. Of these, 10,2 thousand compensations have already been paid, totaling R$2,18 billion in compensation and financial aid. More than 3,4 compensation proposals were presented to traders and businesspeople.

The Company has been acting proactively in all dimensions relating to Alagoas and fully fulfilling the commitments assumed, also highlighting: completion of the environmental diagnosis of the area and significant progress in the social diagnosis; completion of the Urban Mobility Plan and start of actions scheduled for the next quarter; start of demolition works on the Mutange slope; and plan to close the salt wells, exceeding 48% progress in filling the first two cavities with sand.

Looking to the future, Braskem will maintain its focus on its strategic pillars, which are: the search for greater productivity and competitiveness; growth and geographic, raw material and product diversification; and sustainability. Therefore, in 2022 the company foresees renewable and recycling businesses and improving the productivity of existing assets as important “avenues of growth”.