Switzerland-headed specialty chemical company Clariant AG has announced a financial impairment of its sunliquid plant in Podari, Romania, amounting to approximately CHF 225 million (≈ EUR 227.8 million).
As previously reported, the sunliquid plant began production in the second quarter of 2022, though has not yet achieved the targeted yields and other operational parameters on an industrial scale.
Clariant has thus completed a financial assessment of the plant as part of the annual impairment testing in accordance with International Financial Reporting Standards (IFRS).
As a result of this analysis, Clariant has concluded that impairment to the current asset value of the Podari plant of approximately CHF 225 million (≈ EUR 227.8 million) is appropriate based on the delayed ramp-up and the current financial performance.
However, Clariant confirms the unique value of its sunliquid technology and will continue its commercialization. Technology offers a fully integrated process design built on established process technology.
The innovative technology features include chemical-free pre-treatment, the integrated production of feedstock- and process-specific enzymes, and simultaneous C5 and C6 sugar fermentation.
The company aims to address the operational challenges by continuously adjusting production processes with the target of achieving the commercial viability of the new technology.
Our sunliquid technology, which converts agricultural waste into second-generation bioethanol, represents a significant step in the development of sustainable renewable fuel. The industrialization of our new technology remains challenging, and therefore impacts underlying financial assumptions, giving rise to the impairment announced today. Nonetheless, we will continue our efforts to achieve commercial viability of the technology, said Conrad Keijzer, CEO of Clariant.
This impairment has no impact on cash, will be booked in December 2022, and will, therefore, be reflected in the full-year 2022 results, due to be announced on 2 March 2023.
While we are disappointed by this impairment, we are however pleased with our strong Group financial performance in the first three quarters of 2022. Consequently, we confirm our 2025 financial targets and continue to focus on the execution of our leading purpose-driven sustainability strategy, ended Conrad Keijzer.
