In Finland, oil company Neste has announced a performance improvement program that includes deemphasizing renewable chemicals. The company cites a significantly changed market environment and weakened financial performance for the strategic shift. “Our current financial performance is weak and not sustainable,” said Neste’s President and CEO Heikki Malinen in a press statement. “Therefore, we must take urgent action to reset various parts of our company. Adjustments to our cost structure and development portfolio are necessary to meet the current and foreseeable market realities.”
Neste said it will continue to strengthen its competitive advantage by developing its current raw material base, novel vegetable oils sourcing and lignocellulosic raw materials research. In Renewable Products, Neste is planning to streamline its renewable and circular polymers and chemicals activities, focusing on renewable fuels.
The company will also simplify its commercial models and sales channels for renewables. The program targets a total of €350 million (US$366 million) EBITDA run rate improvement by the end of 2026, of which €250 million from operational costs.