NEWS
Neste scales back in renewables
During its annual results presentation , Finland ’ s Neste announced a performance improvement programme that will , among other things , change its focus in renewables . The company said that this was the result of a “ significantly changed market environment and weakened financial performance ”, in addition to a comprehensive full potential analysis that started in October 2024 .
Neste will continue to develop its current raw material base , sourcing
Malinen - Urgent reset action needed
novel vegetable oils and researching lignocellulosic feedstocks . However , it will scale down investments in the development of algae and the Power-to-X process , which seeks to produce fuels and raw materials for the petrochemical industry . It will now focus on renewable fuels rather than renewable and circular polymers and chemical activities .
In addition , the focus of the ongoing transformation of the Porvoo refinery is now to be on energy-efficiency and renewable hydrogen ; other elements may be postponed . As part of this , the company is considering simplifying its commercial models and streamlining its sales channels for renewables to accelerate sales growth .
“ Our current financial performance is weak and not sustainable . Therefore , we must take urgent action to reset various parts of our company ,” said president and CEO Heikki Malinen . He added that full-year comparable EBITDA of € 1,252 million in 20204 , down by 63.8 % on 2023 , “ is not satisfactory , nor sustainable ”.
Within this , Renewable Products was hit by global overcapacity and many new competitors , resulting in a decline in renewable fuel sales prices and intensified demand for waste and residue raw materials . In addition , the weakening fossil diesel price had a further negative impact on sales prices . Thus , although sales volumes grew by 8.8 % to 3.7 million tonnes , comparable EBITDA fell by 73 % to € 514 million .
The overall goal is to achieved a € 350 million EBITDA run rate improvement by the end of 2026 , € 250 million from operational costs . Cost savings of € 65 million / year will be sought by improved internal efficiency and a simpler operating model . Some 600 jobs in the Oil Products and Renewable Products business areas , 75 % of them in Finland , will be cut .
6 SPECIALITY CHEMICALS MAGAZINE ESTABLISHED 1981