Indorama Ventures has reported a 63% year-on-year jump in EBITDA for the first nine months of 2026, reaching THB 43.5 billion, as aggressive cost-cutting, capacity rationalisation and tighter working capital management strengthened its financial performance.
The global sustainable chemicals producer also swung to a net profit before impairments and exceptional items of THB 9.8 billion, against a loss of THB 2.6 billion in the corresponding period last year. Reported net profit stood at THB 5.3 billion.
EBITDA per tonne climbed approximately 75% year-on-year, while the EBITDA margin expanded to 11% from 8%, despite a 5% decline in sales volumes. The lower volumes reflected the company's capacity rationalisation programme under its IVL 2.0 strategy, along with efforts to align production with sales and inventory targets.
For the third quarter of 2026, EBITDA rose 65% year-on-year to THB 13.7 billion, although it declined 37% sequentially from the exceptionally strong second quarter, when market conditions were particularly favourable.
Beyond improved earnings, Indorama Ventures has made significant progress in strengthening its balance sheet. Operating cash flow after maintenance capital expenditure surged 47% to THB 34.5 billion, equivalent to approximately 80% of EBITDA. Net debt declined by around THB 19 billion year-on-year, while net debt-to-EBITDA improved to 4.69x from 6.61x.
The company has also reduced its exposure to inventory-related volatility. Through tighter Sales & Operations Execution (S&OE) discipline, inventory turns improved to 5.2x from 4.7x, despite crude oil prices rising by approximately one-third. IVL is targeting further improvement to 6.0x.
The company said its lower inventory exposure would significantly cushion the impact of any future crude price decline compared with previous market cycles, while creating room to gradually increase operating rates through 2027 and 2028 after deliberately curtailing production in 2026.
A major driver of the turnaround has been a sweeping restructuring of the company's global manufacturing footprint. Since 2023, Indorama Ventures has exited or restructured 10 uncompetitive sites, eliminating approximately 3.5 million tonnes of capacity.
Most of the affected facilities were in Europe and the CPET and Fibers segments, which faced the greatest pressure from structural changes in aromatics and industry overcapacity.
By shifting production to more competitive facilities, IVL has retained its customers and market share while cutting fixed costs by approximately THB 10 billion from 2023 levels. The company described these savings as structural, making them less dependent on market spreads.
Another key growth lever is the consolidation of Indovida's packaging business in India, which remains on track for completion in the first quarter of 2027. The integration is expected to nearly double Indovida's EBITDA, helping offset the normalisation of the exceptionally strong market conditions witnessed in 2026.
Indorama Ventures Group CEO Aloke Lohia said the company's improving performance reflected not just favourable market conditions but also fundamental operational changes.
“Favorable markets have supported our results this year, but they are not the whole story. Deliberate management actions are making us more competitive, improving the quality of our earnings and generating the cash to reduce debt. Our local-for-local model and access to feedstocks allowed us to serve customers reliably when they needed it most.
“We enter 2027 from a stronger position, with a leaner cost base and lower debt. We reaffirm our 2028 ambitions to double EBITDA and reduce net debt to EBITDA to 3x or below, and I remain confident we will deliver the midway 2027 milestone we set out at our Capital Markets Day.”
With earnings momentum improving, a leaner manufacturing base and debt on a downward trajectory, Indorama Ventures is now positioning itself for its next phase of growth.
The company has reaffirmed its 2028 ambitions to double EBITDA and bring net debt-to-EBITDA down to 3x or below, while maintaining confidence in achieving the interim milestones outlined at its Capital Markets Day.
