Braskem recorded strong growth in sales to the domestic market in the first quarter of 2008, driven by the 7% expansion in thermoplastic resin (polyethylene, polypropylene and PVC) sales volume, especially PVC, whose sales grew 13%, reflecting the heating up of the civil construction market. The acceleration in demand contributed to the 21% growth in net revenues in dollars, the currency of reference for the petrochemical sector, compared to the same period of 2007, totaling US$ 2.5 billion, equivalent to R$ 4.4 billion.

"Braskem maintained its level of operational excellence, together with important advances in our growth agenda with the creation of value, where it is necessary to underscore the inauguration of the Paulínia Unit and conclusion of the acquisition of Politeno and the Ipiranga Group petrochemical assets," says José Carlos Grubisich, president of Braskem. "This performance allows us to continue responding to the sustained growth of the Brazilian economy and to quickly approach the goal to position the company among the ten most important petrochemical industries in the world," says Grubisich.

The good performance of its industrial units permitted Braskem to sustain production at high levels. In this context, it is worth underscoring the historical production record achieved in the first quarter by the PVC units with 130 thousand tons manufactured during the period, incorporating productivity and operational reliability gains.

As a result of stoppages for scheduled maintenance for the second quarter at the Copesul and Camaçari Units, Braskem further focused its attention on the domestic market. Due to this strategy, exported resin volume was lower with a 38% reduction for polyethylene and polypropylene. The increase in resin prices in the international market compensated the drop in volume, permitting revenues of US$ 509 million exports, with a 1% growth compared to the first quarter of 2007, equivalent to 20% of net revenue.

Braskem’s consolidated EBITDA for the first quarter was R$ 583 million compared to the R$ 853 million for the same period last year. This drop reflects the negative impact from the strong increase in raw material and energy prices. For comparison purposes, the average price for naphtha increased 55% over this period, jumping from US$ 555 per ton to US$ 842, with an additional impact of a cost greater than US$ 550 million. In dollars, consolidated EBITDA reached US$ 336 million. The EBITDA margin grew nearly 13.2%, in line with the profitability verified in 4T07.

Braskem’s net profits in the first quarter reached R$ 83 million, which represented a 204% increase in relation to the R$ 27 million in profits verified in the fourth quarter of 2007. Compared to the first quarter of last year, net profits fell R$ 45 million.

Braskem has a vocation for growth and to achieve its objectives it invested R$ 242 million in the first quarter, 28% more than the R$ 189 million invested in the same period last year. This amount is added to the last installment for the acquisition of Politeno, of R$ 247 million, and the Ipiranga Group petrochemical assets, concluded at the end of February, worth R$ 638 million. The integration of these assets goes on with very positive results and the synergies already captured by the end of March exceeded R$ 96 million on annual and recurring EBITDA.

Within the petrochemical sector consolidation process, in April, the Secretary for Economic Accompaniment (SEAE) of the Ministry of Finance and the Secretary of Economic Right (SDE) of the Ministry of Justice recommended the Administrative Council for Economic Defense (CADE) to approve, without restrictions, the investment agreement between Braskem and Petrobras announced last November.

The transfer of control process from Petroflex to Lanxess was also concluded in April, where Braskem sold its entire share in the company. The initiative reflects Braskem’s commitment to increasingly focus on its strategic markets.

With the inauguration of the Paulínia Unit on April 25, Braskem consolidated its leadership in the Latin American polypropylene market, increasing its production capacity for this resin to 1.1 million tons/year and confirming its competence in implementing new industrial units within the projected period and at competitive costs. "This capacity will be valuable for the success of new scheduled growth projects with the creation of value over coming years," says Grubisich.