The Brazilian market for polyethylene, polypropylene and PVC thermoplastic resins experienced a growth of more than 14% compared to the same period in 2005. This is proof of the more vigorous growth of the Brazilian economy and the resumption of the historical consumption elasticity of these resins in relation to GDP. In this context, Braskem presented a 6% increase in net revenues this semester when expressed in dollars, totaling US$ 2.5 billion - or R$ 5.6 billion.

With this result, Braskem maintained the leadership in the regional market in all of its strategic operation segments. This performance demonstrates Braskem was correct in acquiring Politeno, announced in the beginning of April and approved unanimously and without restrictions in July by the Administrative Council of Economic Defense - CADE, which reaffirmed that the relevant market for the petrochemical sector has a global scope. The acquisition represented an immediate 360 thousand t/year increase in Braskem’s polyethylene productive capacity.

Despite this growth in revenue, Braskem’s results were affected by the exchange rate and the increase in international prices of oil and energy, which represented an additional US$ 204 million in costs to the company in the first semester. The impact affected the company’s EBITDA - earnings before interest, depreciation and amortization - performance, which reached the sum of R$ 653 million in the semester and R$ 253 million in the second quarter.

By the end of June, the Braskem + program had provided improvements in productivity and competitiveness worth R$ 297 million, in annualized and recurrent bases, making it possible for Braskem to partially compensate for the effects of a challenging scenario. The acceleration of this project should make it possible to capture R$ 420 million in projected earnings for the entire program by the end of this year, thus anticipating its conclusion by almost one year. Furthermore, the new integrated management system that will be put into operation next October as part of the Fórmula Braskem project, will create new opportunities for gains in efficiency, which should have full impact on the company’s results starting in 2007.

In the international market, the prices for petrochemical products demonstrated an important recovery starting in May, which has yet to be reflected in the domestic market due to the momentary excess capacity caused by the entry of new competitors in the market and the increase in imports, facilitated by the depreciation of the dollar. "The combination of a strong demand for thermoplastic resins and petrochemical products in the domestic market with the difference in prices being practiced internally compared to international reality creates excellent opportunities to recover profitability in the sector," says José Carlos Grubisich, president of Braskem.

Braskem exports totaled US$ 613 million in the semester, a growth of 12% over the same period last year. The good performance reflects the improved profitability in the international petrochemical market and it demonstrates the company’s long-term commitment with its strategic clients outside Brazil, as well as its flexibility to minimize the impact of Rio Polímeros having fully entered the market.

Braskem revealed net profits of R$ 68 million in the first semester, whereas it recorded a loss of R$ 54 million in the second quarter.

With the incorporation of Polialden at the end of May, Braskem successfully concluded the corporate integration process that gave rise to the formation of the company. 

Braskem also obtained the certification of compliance with the demands of the Sarbanes-Oxley Law in the second quarter, one year before the deadline conceded to non-American companies with shares negotiated in that country. 

The investments made by the company in the first semester totaled R$ 377 million, including projects with a high return, such as the Braskem + and the Fórmula Braskem programs, compared to the R$ 244 million in the same period of 2005. "We are investing to accompany the growth of the Brazilian economy and the petrochemical market, maintaining the commitment with financial discipline and aiming to ensure the creation of value for our shareholders in every phase of the sector," affirms Grubisich.