PCC SE: Chemicals group PCC SE celebrates anniversary: 25 years of value-driven growth

Group Headquarters of PCC SE in Duisburg, Germany (photo: PCC SE)

Duisburg (pta010/19.10.2018/10:15) - International chemicals group PCC SE celebrates 25th anniversary tomorrow. On October 20, 1993, Waldemar Preussner, Chairman of the Administrative Board and sole shareholder of PCC SE, founded the core of today's group of companies: Petro Carbo Chem commodity trading company (PCC) in Duisburg-Homberg. "We wanted to seize the new opportunities offered by market liberalization in Eastern Europe at the beginning of the 1990s," says Preussner (59) in recalling the company's early days. Born in Upper Silesia as the son of parents of German descent, the economics graduate was an experienced commodity trading manager and knew the region well by the time he ventured into self-employment. And it was a venture that paid off: PCC commenced business operations on January 1, 1994 and in its first year generated sales equating to Euro 59.4 million. Of the two current managing directors of PCC SE, Ulrike Warnecke was part of the original team, while Dr. Alfred Pelzer joined the company in 1995.

The PCC Group has since continued to enjoy strong growth through the acquisition of companies and participating interests coupled with substantial investments in the modernization and expansion of the associated production capacities. Today, it represents a broadly diversified, value-driven organization with more than 3,400 employees in 18 countries. Group sales in 2017 amounted to Euro 683.2 million, a good 20 percent more than in the previous year, with further growth in the pipeline: In all, PCC SE's total investment spend over the last five years has been in the region of Euro 577 million.

Corporate DNA: a healthy mix of experience and courage

The PCC Group is thus continuing to pursue the same original growth strategy: "From the very beginning, we have looked for investment opportunities in lucrative and less competitive submarkets where we really know our way around," says Preussner, "and once found, we go all out to make them work. You could say that it is this combination of experience and courage that makes up our DNA. We are resolute in our desire to continuously optimize our investment portfolio and create new value."

In the early years, rapid growth was initially achieved in the trading business with petrochemical and carbon-based commodities. This is still an important activity today; the founding company, now operating under the name PCC Trade & Services GmbH, remains the largest trading company in the Group. In 1997, PCC began its own processing of crude benzene in Ukraine, thus launching the Chemicals business - now its main source of sales and earnings.

Switch to joint-stock status and issue of the first corporate bond

In 1998, PCC GmbH was carved out to create PCC AG. The company headquarters became the PCC Villa, also in Duisburg's Homberg district. As a joint-stock corporation, PCC also issued its first bond. To this day, 20 years later, corporate bonds remain PCC's main source of funding as flexible financing instruments allowing independence from banks. In 2007, the Group adopted the legal form of a European corporation (Societas Europaea) in 2007: "Right from the outset, we have regarded Europe as our home market," explains Preussner. "The conversion to an SE is intended to underline our European identity."

PCC Rokita S.A. becomes part of the PCC Group - and then a listed company

The process of diversification began in the year 2000: The acquisition of shares in a Polish logistics company provided the beginnings of the Logistics division. And in 2002, even before the eastward expansion of the EU which, two years later, attracted the attention of many investors to the new markets in Eastern Europe, PCC AG bought a third of the shares in one of Poland's largest chemical groups, today's PCC Rokita SA. In the following year, the company acquired a majority stake in this former state-owned company based near the small town of Brzeg Dolny, some 40 kilometers from Wrocław.

Through a multi-year investment program, productivity was continuously increased and a flourishing chemicals concern was born. As a result, PCC Rokita SA developed into the strongest pillar of the PCC Group, due particularly to its position as a major producer of polyols and basic chemicals such as chlorine. To this day, the company is Poland's only producer of polyether polyols as important feedstocks for the manufacture of polyurethane foams. 2014 saw PCC SE acquire the remaining shares in PCC Rokita to become its sole owner. And also in 2014, PCC Rokita proved how far it had come with a successful IPO. Over the four years since its initial listing on the Warsaw Stock Exchange, the share price has risen more than 250 percent.

PCC SE had already previously floated minority interests in two other Group entities: The chemicals company PCC Exol SA has been listed on the Warsaw Stock Exchange since 2012. The company is Poland's only producer of surfactants, the basic ingredients used in particular for the formulation of cleaning, washing and personal care products. The container logistics company PCC Intermodal S.A. had already gone public in 2009. One of the leading providers of combined transport services in Poland, the PCC Intermodal has five modern container transshipment terminals in Poland and Germany.

The biggest investment sell-off to date

In the same year, 2009, PCC SE also succeeded in closing an exceptional investment sell-off: Deutsche Bahn AG took over PCC's Polish railway activities subgroup, which at the time was the largest business unit of the Logistics division alongside PCC Intermodal S.A. "With this sale," says Preussner, "we recorded the greatest success of our active investment portfolio management strategy to date."

In 2013, the Group adopted a diversified structure comprising eight segments. The Chemicals division is made up of the segments Polyols, Surfactants, Chlorine, Specialty Chemicals and Consumer Products. The Logistics division is dominated by PCC Intermodal S.A. And within the Energy segment, there are modern power generating facilities that serve to supply PCC's chemical plants in Poland, while in Southeast Europe, PCC operates a number of small environmentally compatible power plants.

Current and future projects of PCC SE

The Holding/Projects segment manages investment projects in the development and construction phases, including a multi-year project located in Iceland: In 2018, 25 years after the PCC was founded, the company was able to complete the construction - and commence the commissioning - of an advanced silicon metal production plant in the north of the Island. With an investment volume of around Euro 265 million, this has been the largest single project in the history of the Group to date. In addition, PCC SE is expanding in Russia through a joint venture to establish the production of high-purity aerosol-grade dimethyl ether (DME). And PCC Rokita SA has, in recent years, acquired shares in a Thai manufacturer of polyols and polyurethanes. The aim is to develop the markets of Southeast Asia, China and India and thus to further expand the PCC Chemicals division internationally.

About PCC:

Headquartered in Duisburg, Germany, PCC SE is an international chemicals group that is also active in the logistics and energy sectors. The Group was founded in 1993. With around 3,400 employees in 18 countries, the Group posted consolidated sales of some Euro 683.2 million in 2017. The majority of these revenues, around 86 percent, was generated by the five segments of PCC's Chemicals division - Polyols, Surfactants, Chlorine, Specialty Chemicals and Consumer Products - operating primarily at sites in Central and Eastern Europe, primarily in Poland. The largest Group company is PCC Rokita SA, which has one of Poland's biggest chemical plants near Wrocław. Among other things, it is a major chlorine producer and Eastern Europe's leading manufacturer of polyols. PCC Exol SA is Poland's biggest manufacturer of surfactants. In the Logistics segment, PCC container transport services connect international destinations, and within the Energy segment, PCC operates a number of modern power plants.

(Ende)