Net revenue reached R$12.6 billion

SÃO PAULO, June 3, 2020 /PRNewswire/ -- BRASKEM S.A. (B3: BRKM3, BRKM5 and BRKM6; NYSE: BAK; LATIBEX: XBRK) announces today its results for 1Q20.

HIGHLIGHTS:

Braskem - Consolidated:

• Braskem recorded recurring EBITDA of US$294 million, up 22% from 4Q19, explained by (i) the higher sales volume of resins in the Brazilian market, PP in the United States and Europe and PE in Mexico; and (ii) the lower selling, general and administrative expenses. In Brazilian real, recurring EBITDA amounted to R$1,313 million, 32% higher than in 4Q19. In relation to the same quarter last year, recurring EBITDA decreased by 34% and 22%, in U.S. dollar and Brazilian real respectively, due to lower spreads in the international market.
  
  
• In the quarter, sales of resins and chemicals recycled globally amounted to 1,200 tons, representing an increase of 154% in relation to 1Q19.
  
  
• In the quarter, the Company reported a net loss of R$3,649 million, mainly due to the exchange variation impact on the financial result given the effects from the Brazilian reais depreciation against the U.S. dollar on the net exposure in the amount of US$2,427 million and the Mexican peso depreciation against the U.S. dollar on the outstanding balance of the loan of Braskem Idesa of US$2,255 million as of March 31, 2020.
  
  
• Financial leverage measured by the ratio of net debt to EBITDA4 in U.S. dollar ended the quarter at 5.84x.
  
  
• The recordable and lost-time injury frequency rate stood at 0.81 (events / 1MM HH), which is 74% below the industry average.
  
  
• In May, the U.S. Department of Justice (DoJ) and the U.S. Securities and Exchange Commission (SEC) confirmed the conclusion of the independent compliance monitorship at Braskem, which was established in the agreements signed by Braskem, the DoJ and the SEC on December 21, 2016 ("Agreements"). The decision of the DoJ and SEC was based on a final report by the independent monitors that attested that the Company implemented all the recommendations regarding the structure and the execution of its compliance program and concluded that the Company meets the standards set out in the DoJ Plea agreement and the SEC consent. With the end of the independent monitoring period and the certification by the Federal Prosecution Office (MPF), the DoJ and the SEC, the Company has complied with its obligations established in the agreements signed with these authorities and has successfully concluded the three-year term under the Agreements.

Brazil:

• EBITDA in Brazil was US$233 million (R$1,049 million), 214% higher than in 4Q19 and representing 62% of the Company's consolidated EBITDA. The growth in EBITDA was mainly explained by the lower expenses related to Alagoas. In relation to 1Q19, the decline in EBITDA was due to the increase in COGS given the higher naphtha costs in 1Q20.

United States and Europe:

• EBITDA in United States and Europe was US$62 million (R$277 million), up 33% from 4Q19 and representing 17% of the Company's consolidated EBITDA. The better performance in the quarter is mainly explained by the capacity utilization rates normalization in the United States and the restocking trend in the chain in Europe due to uncertainties regarding the COVID-19 impacts. In relation to 1Q19, EBITDA reduction was due to the lower PP spread.
  
  
• The construction of the new PP plant reached 98.4% of completion at the end of the first quarter, with total investment to date of US$634 million. In the quarter, Braskem America imported 8,000 tons of PP from Braskem in Brazil to continue the new plant's pre-marketing activities.

Mexico:

• EBITDA in Mexico was US$79 million (R$354 million), 2% higher than in 4Q19 and representing 21% of the Company's consolidated EBITDA. The increase in EBITDA is mainly explained by the growth in PE sales volume supported by the higher supply of ethane. In relation to 1Q19, the decrease in EBITDA was due to the lower PE spread in the region.
  
  
• In the quarter, Braskem Idesa imported 12,600 tons of ethane from the United States to partially offset the lower supply of ethane by Pemex, which enabled the Mexico Petrochemical Complex to operate at a higher capacity utilization rate in the period.

The full earnings release is available on the Company's IR website: http://www.braskem-ri.com.br/home-en

Braskem will host conference calls to discuss its Results WEDNESDAY, June 3 at 10:00 a.m. US ET.

Additional information may be obtained from the Investor Relations Department at +55 11 3576-9531 or [email protected]

SOURCE Braskem S.A.