Braskem (BRKM5) Investor Day 2024 summary

Strategic direction and growth initiatives

• Focus on three growth avenues: traditional fossil-based business, renewables, and recycling, each with tailored strategies for profitability, sustainability, and global leadership by 2030.

• Ambition to reach 1 million tons of both bio-based and recycled products annually by 2030, leveraging global leadership in biopolymers and new partnerships, with ongoing projects in Brazil, the U.S., Thailand, and Europe.

• Selective investments in decarbonization, productivity, and competitiveness, targeting a 15% reduction in Scope 1 and 2 emissions by 2030 and carbon neutrality by 2050, supported by 51 prioritized initiatives.

• Expansion projects include increasing PVC capacity in Brazil, new solvent launches, a major ethane import terminal in Mexico, and expanded green ethylene capacity in Brazil.

• Strategic partnerships and innovation in circular economy, biopolymers, and advanced recycling technologies drive new business models and future growth.

Financial management and operational resilience

• Maintains robust liquidity with a minimum cash policy of $1–1.8 billion, long-term debt profile, and active risk management for currency, commodity, and credit risks.

• Alagoas event remediation is a key financial priority, with most obligations expected to be completed by 2026–2027; over 99% of resident relocations completed, ongoing urban and environmental projects, and R$16.3 billion provisioned.

• Cost optimization, CapEx discipline, and operational efficiency are emphasized to restore cash generation and reduce leverage to 2.5x net debt/EBITDA, supporting investment grade ambitions.

• Short-term levers include capturing $100–$150 million in additional EBITDA through cost reductions, tariff increases, and market share recovery in Brazil.

• Value creation targets include a forecasted $400 million run-rate improvement from resilience and financial health, and $700–$900 million in value capture by 2030.

Market outlook and industry trends

• Global demand for petrochemical products remains correlated with GDP growth, though at a slower pace than previous decades.

• Industry cycles are expected to be longer due to recent overcapacity, especially from China, and slower global growth; rationalization and consolidation are seen as key to spread recovery.

• Ethane-based production is highlighted as a competitive advantage, with expansion opportunities in Brazil and Mexico tied to feedstock availability and regulatory support.

• Regulatory measures such as anti-dumping policies and increased import tariffs are critical for restoring domestic industry profitability and enabling new investments.

• Sustainability, circularity, and advocacy for regulatory frameworks are essential for creating demand and value in recycled and bio-based product segments.