Meeting with Thierry Le Hénaff, Arkema Chairman and Chief Executive Officer
Our excellent performance in 2016 confirms the wisdom of our last decade, which remade the company into one focused on specialty chemicals, innovative materials, growth regions and corporate social responsibility. Thierry le Hénaff reviews the Group’s development strategy and its successes.
How would you describe Arkema’s performance in 2016?
Thierry Le Hénaff > Arkema reported record earnings last year. In an environment of moderate global growth, we generated €7.5 billion in revenues and increased our volumes by 3.2%. Our EBITDA rose 12.5% to €1.19 billion — its highest level ever. EBITDA margin grew to 15.8%, gaining two points over last year. And our adjusted net income increased by 34%. All three business segments — Industrial Specialties, High-Performance Materials and Coating Solutions — contributed to these results. Our people can be proud of their performance.
What drove Arkema’s success in 2016?
Thierry Le Hénaff > Beyond financials, 2016 was an inflection point: several major projects realized their full potential. We began reaping the rewards of adding Bostik — which achieved its 2017 growth targets a full year ahead of schedule. In Malaysia, our Kerteh plant, which started in 2015, came to full operating capacity, confirming the growth potential of thiochemicals in Asia. And, buoyed by innovation, our technical polymers were hugely successful.
How does this performance fit into Arkema’s history?
Thierry Le Hénaff > It is the direct result of the transformation begun the moment the company was created. Ten years later, you would hardly recognize Arkema. For one thing, we’ve shifted the focus of our product portfolio to specialty chemicals and innovative materials. Innovation has become our essence; Arkema has made the list of the World’s Top 100 Global Innovators for the sixth year in a row. For another, we rebalanced the company regionally to strengthen Arkema in Asia, close to emerging marketplaces, and in North America, an area of stable growth.
How are you approaching the next few years?
Thierry Le Hénaff > With confidence and ambition. For 2017, we’re maintaining the ambitious EBITDA target of €1.3 billion set in 2014. If we achieve that, our EBITDA will have risen by more than 65% in three years, a growth rate among the best in the industry. We now have very solid foundations, including several product lines with strong prospects. They include Bostik’s adhesives, strengthened by the acquisition of Den Braven in 2016, technical polymers, molecular sieves, downstream acrylics (with Sartomer and Coatex) and thiochemicals. We see our first decade as a step and a springboard to even better things. Our clear goal
How do corporate social responsibility (CSR) and sustainability contribute to Arkema’s success?
Thierry Le Hénaff > CSR and sustainability are integral to our performance. Our CSR and sustainability commitments — safety, the environment, innovation, personal and collective development and open lines of communication with our stakeholders — and are backed by quantified targets for 2025. To establish that our CSR and sustainability processes are on track, we surveyed our stakeholders in 2016 through a “materiality analysis”. It confirmed that our priorities match the expectations of the internal and external stakeholders we surveyed. We halved our total recordable injury rate between 2012 and 2016. Innovations that promote sustainability — especially in lightweight materials, water filtration and new energies — are core to our growth strategy. Our human resources staff has taken steps to develop the leadership skills of women and non-French nationals. The Arkenergy program has cut our energy usage 6% since 2014. In 2016, we introduced the Optim’O program to reduce our water bills by 15%. All these improvements are positively reflected in ratings by specialized agencies.