What are your thoughts on the past year?
In 2021, we achieved record financial performance and continued to progress in line with our 2024 roadmap. At €9.5 billion, our revenue increased by more than 25% compared to 2020, while our EBITDA, at over €1.7 billion, and our margin of 18.1%, reached historic highs, despite a complex environment, marked by the impact of the health crisis and very high inflation in raw materials and energy.
These results were only made possible thanks to the outstanding work and determination of the Arkema teams, to whom I would like to offer my sincere thanks. Our performance in 2021 therefore confirms the relevance of our long-term transformation strategy and marks the beginning of a new era of growth for Arkema. In the context of the post-Covid economic recovery, we have achieved strong organic growth, demonstrating the strength of our unique Specialty Materials offering which is based on our three complementary segments: Adhesives, Advanced materials and Coating Solutions.
In 2022, the geopolitical context of the war in Ukraine is affecting our economies. What might the consequences be for Arkema?
Firstly, like many, I am deeply concerned by this tragedy and the fate of the Ukrainian people suffering the consequences of the war and in many cases being forced into exile. Arkema decided to make a donation to UNICEF, which works on the ground to help children and their families.
We do not have an industrial base in Ukraine, Russia or Belarus and this area accounts for less than 1% of our sales, with 65 employees based in Russia. Of course, we will be keeping a very close eye on how the situation develops.
In terms of our activity as a whole, during the first months of the year, global demand remained relatively strong, but with some slight variations according to market and region. Our growth this year will be further driven by our innovation with regard to major societal trends. One of our priorities at the start of this year is our ability to pass on the sharp increases in raw materials and energy and to cope with disruptions in supply chains. This year promises to be similar to last year in terms of the troubled operational environment, but we remain confident and are ready to adapt. We believe that 2022 will be another very good year, as presented in our guidance, which forecasts an EBITDA comparable to last year on a consistent, and replace basis in Specialty Materials.
How did Arkema’s profile evolve in 2021?
The product portfolio continued to evolve toward Specialty Materials, both through organic developments and our M&A activity. Following the completion of the sale of our PMMA business (Altuglas International) and the acquisition of Ashland’s performance adhesives, nearly 90% of Arkema's sales are now generated in specialties.
We have come a long way since our initial public offering in 2006, when the Group generated €5 billion in revenue, mainly through Intermediates. We are thus on track to achieve our ambition of becoming a 100% Specialty Materials player by 2024, with revenue in excess of €10 billion.
Will you continue to make new acquisitions in 2022 and beyond?
Today, we have a solid balance sheet with a net debt ratio of approximately 1.7 times EBITDA, after the acquisition of Ashland’s adhesives. As a result, we have the financial capacity to continue to make small and medium-sized acquisitions across our three segments. Our acquisition strategy is to target high-quality assets that enable us to accelerate our development in high-growth technologies, with a strong focus on sustainability. We plan to make three or four small acquisitions this year.
You changed your visual identity at the end of 2021 and adopted a new signature. What was the reasoning behind this?
Indeed we did. We felt that it was the right time to change our visual identity and thus fully reflect the evolution of Arkema’s profile toward Specialty Materials.
This has seen us become better aligned with our strategic vision which is based on materials science and the growing demand for sustainable solutions from our customers. Our new blue and green logo and our signature “Innovative materials for a sustainable world” embody this positioning and our response to environmental, climatic, energy, economic, and social challenges.
We have established very interesting positions in several areas with high growth potential, including batteries, 3D printing, more environmentally-friendly paints, lightweighting, bio-sourced materials used in green mobility, housing, consumer goods, water treatment, electronics, and sport. Hydrogen is another example of an area in which we see exciting opportunities for some of our materials.
Of course, to capitalize on all these new opportunities, the power of our innovation and the quality of our R&D are paramount. Consequently, we are now aiming for revenue of €1.5 billion from our five innovation platforms between 2019 and 2030, compared to €1 billion as previously announced.
What is your vision for 2024 and beyond?
There will be many sources of complexity and uncertainty over the coming years. The health context, geopolitical tensions, energy issues, access to talent, technological disruption, and the return of inflation are all issues that will require the Group to be agile and exercise caution. But I have full confidence in Arkema’s future. We have the right strategy, a balanced positioning, talented and highly-engaged teams, and world-class technological expertise.
The Group will continue to grow thanks to the many opportunities available to us to support our customers in their quest for sustainable performance.
To keep up with this growth, we made over €750 million in industrial investment in 2021. We have committed to new projects that will shape the future, such as a 50% capacity increase for PVDF (polyvinylidene fluoride) in China and France to serve the battery market, where we aim to generate €1 billion in revenue by 2030. This year we will start up our polyamide 11 (PA11) bio-plant in Singapore, the largest industrial project ever undertaken by the Group, and a PA11 powders plant in China in 2023. A hydrofluoric acid plant will be commissioned in the United States this year and at the end of 2023, a production unit for 1233zd, a new generation of fluorospecialties with minimal impact in terms of emissions. We will double our photocurable resins capacity in China for the electronics and renewable energy markets. Lastly, in France, we are also in the process of increasing our capacity for Pebax® elastomers - used in sports shoes and consumer goods - by 25%. All of these projects will have a positive impact on the Group’s environmental footprint.
Your CSR ambition has never been stronger and more visible. How is Arkema progressing?
In 2021, we were very active in terms of Corporate Social Responsibility. It is at the heart of our strategy and our employees’ priorities. For example, we have considerably expanded our portfolio sustainability assessment program, which measures the percentage of sales that contribute significantly to the UN Sustainable Development Goals.
Secondly, we have accelerated our initiatives for a circular economy by increasing the share of revenue covered by a lifecycle analysis. Last year we acquired Agiplast, a high-performance polymer recycling specialist and a long-standing partner of Arkema. Furthermore, in line with the announcement at the beginning of 2020 of an ambitious climate plan to reduce the Group’s greenhouse gases by 38% by 2030 compared to our 2015 baseline, we had already reduced our emissions by 34% at the end of 2021.
We are thrilled to see these achievements and this progress being recognized: we are now included in the CAC 40 ESG Index, which features the 40 largest companies listed in Paris with the best ESG practices. We have improved our ranking from 6th to 3rd place out of the 114 DJSI World chemical companies and have also consolidated our strong rankings from many non-financial rating agencies.
This year, you incorporated the concept of inclusion in Arkema's values. Why?
Since its initial public offering in 2006, the Group has been built on a foundation of strong values - solidarity, performance, simplicity and empowerment - that shape our corporate culture.
These are not empty words for us, these values underpin our human relationships, our management, and of course our development. In 2021, I wanted to add the value of inclusion to these four historical values.
For me, the company has an important social role to play and inclusion is key because it recognizes the importance of tolerance, acceptance of difference, and the value of diversity.
Everyone must feel that they have a place at Arkema, regardless of their origin, gender or profile. Diversity and inclusion go hand in hand, and Arkema must be exemplary in this area in order to realize its ambitions and reach its full potential.
If you were to give a candidate two reasons for joining the Arkema adventure, what would they be?
We are an international company whose growth is based primarily on sustainable innovation and which addresses outstanding human, industrial, commercial and environmental challenges. The Group’s culture is based on authentic values and our employees are convinced of the strength of our vision and strategy, as evidenced by our regular engagement surveys. We offer a respectful, stimulating work environment and varied and empowering career paths. We are a company where employees feel good and give the best of themselves, as illustrated by the Group’s growth over the past 15 years.
If I were talking to a candidate, I would simply say: Join us, we will help you grow, and channel your talent and enthusiasm into an exciting project, based on our belief in the need for a sustainable world.