Slow demand, downtime stifle Orion earnings growth

Houston, Texas – Orion SA expects earnings growth (adjusted EBITDA) to be impacted by a “slower recovery in end markets” and downtimes relating to plant upgrades.

As a result, the US-based carbon black maker has projected its 2023 results to land at the lower end of its previous earnings guidance of $330-340 million.

In a 22 Jan announcement, Orion said demand-recovery is “building slower than expected” in many carbon black markets.

Despite that, the company forecast a fourth year of profit growth in 2024, CEO Corning Painter noting that, similar to 2023, a “mid-single digit increase” in earnings is expected.

In 2023, Orion’s earnings were impacted by upgrade projects to comply with the US Environmental Protection Agency’s (EPA) emissions standards.

Under “the biggest sustainability-related initiative” in its history, Orion has now installed air emissions control technology at all four of its US carbon black plants: in Belpre, Ohio; Borger, Texas; Ivanhoe, Louisiana; and Orange, Texas.

The EPA projects, it said, were especially challenging for Orion, as it has more carbon black plants in the US than any other company.

"Orion will continue to invest in sustainability-linked projects,” concluded Painter, citing the production of materials for lithium-ion batteries and products for the circular economy.