Borealis announces EUR 104 million Q3 net profit

• Borealis announces third consecutive quarter of improved profits and

EUR 64 million increase versus third quarter of 2005
• EUR 200 million investment in 330,000 tonne state-of-the-art Borstar® polypropylene (PP) plant in Burghausen, Germany, on track for completion at the end of 2007
• Borouge, Borealis’ joint venture in the Middle East, announces the establishment of a new innovation centre in the United Arab Emirates

Key figures and ratios (Quarter ending September 30, 2006)		3Q 2006	3Q 2005	1-3Q 2006	1-3Q 2005
Sales revenue	EUR M	1,533	1,232	4,319	3,550
Operating profit / (loss)	EUR M	111	26	245	191
Net profit / (loss) after tax	EUR M	104	40	227	174
Reduction / (increase) in net interest- bearing debt	EUR M	38	21	(77)	(81)
Gearing	%			44	40

Borealis, a leading supplier of innovative plastics solutions, further improved its financial performance in the third quarter, announcing a net profit of EUR 104 million, compared to EUR 92 million in the previous quarter, and EUR 40 million for the same period last year. Net interest-bearing debt fell by EUR 38 million, and the gearing ratio dropped to 44%. These strong third quarter results were underpinned by the successful continued execution of the company’s Value Creation through Innovation strategy.

During the period, Borealis launched innovative plastic solutions for the infrastructure, automotive and advanced packaging markets, including:

• BorECO™ - a highly developed polypropylene for sewerage pipes providing easy installation in winter conditions

• A one-material body interior automotive solution for BMW that has been ecognised with a Society of Plastics Engineers award

• BorForm™ - a complete packaging solution addressing the needs throughout the frozen food industry’s value chain

Borealis reports that the 330,000 tonnes per year (t/y) expansion of its polypropylene (PP) facilities in Burghausen, Germany, based on its proprietary Borstar® technology, is progressing according to plan with completion scheduled for the end of 2007. This EUR 200 million investment will enable Borealis to assert its leading position in providing innovative plastics solutions for the fast-growing advanced packaging markets.

During the quarter, Borouge, the joint venture with the Abu Dhabi National Oil Company (ADNOC) in the United Arab Emirates, announced the creation of an Innovation Centre based in Abu Dhabi. Fully operational in 2009, the centre will concentrate on the development of innovative solutions for polyethylene applications and represent a significant investment in Borouge’s customer-focused research capabilities in the Middle East and Asia Pacific regions.

Looking ahead, Borealis Chief Executive John Taylor comments: “Our strong performance affirms our ability to provide value creating solutions to our customers and creates a sound base for profitable growth.”

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