Topsoe decarbonisation solutions in high demand

March 7, 2022

Revenue increased by 1% to DKK 6,225 million in line with the guidance we provided at the beginning of the year. Strong demand for Topsoe’s renewable fuels solutions offset negative impact from COVID-19.
Topsoe’s share of revenue linked to the energy transition has increased from 2% in 2019, 6% in 2020 and now to 16% in 2021.
EBIT before special items grew by 6% to DKK 903 million.
Net profit increased by 85% to DKK 890 million, driven by operational improvement, the successful divestment of Topsoe’s shares in Faradion in 2021 and one-offs in 2020.
Strong progress on executing on Topsoe’s new vision and strategic transformation to become the ‘go-to’ company for carbon emission reduction technologies.

“We have delivered solid financial results, with earnings – EBIT before special items – up 6%. I am encouraged to see the strong interest in our offerings, not least within our renewable fuels business. Furthermore, we see keen interest in our Power-to-X solutions from companies that wish to support the energy transition by developing green hydrogen, green ammonia, green methanol, or eFuels. Topsoe is one of very few companies that can deliver insights, technology and solutions along the entire value chain for low-carbon emission fuels and chemicals, so we are uniquely positioned to help our customers and the society in the battle against climate change,” says Roeland Baan, CEO at Topsoe.

Solid financial results in 2021 – strong demand for Topsoe’s renewable fuels solutions
COVID-19 had a negative impact on Topsoe’s business during 2021, as many refinery and technology projects were delayed due to low demand and market uncertainty. This was especially the case in the first half of 2021, where our revenue declined by 9%. However, due to general improvements in the market environment combined with strong demand for our renewable fuel offerings, we have been able to deliver 11% revenue growth in the second half of 2021.

In 2021, Topsoe’s earnings (EBIT before special items) amounted to DKK 903 million, up 6% compared to 2020. This was driven by lower operational costs as a result of the organizational restructuring implemented in the fourth quarter of 2020. In addition, Topsoe’s gross margin increased by 1%-point, primarily driven by optimization within operations. Topsoe continues to invest in R&D to support its future vision. In 2021, we increased our R&D costs to 9% of revenue, up from 8% in 2020.

Topsoe’s net profit grew by 85% to DKK 890 million. The high increase was driven by organic growth of the business combined with the successful divestment of our shares in the UK-based battery technology company Faradion. It should also be seen in the light of significant one-off costs in 2020, which resulted in a decrease in net profit compared to the year before.

Driving customers’ decarbonization
Already today, Topsoe provides chemical and fuel producers with technology, catalysts, and solutions for energy-efficient production. These offerings remain highly relevant, while also allowing for our newer technologies to accelerate a responsible transition to renewable energy sources. Our strategy to meet market needs is based on three pillars: Driving our customers’ transition toward carbon emission reduction technologies, building a leadership position in Power-to-X, and optimizing our traditional business.

“We have successfully executed on our strategy. By building on our strong legacy of developing technology, supplying catalysts, and improving energy efficiency for the chemical and refining industries, we have grown our expertise in these areas for decades, and they constitute an essential platform from which we are building our new green solutions. Our share of revenue linked to the energy transition has increased from 2% in 2019, 6% in 2020 and now to 16% in 2021,” says Roeland Baan.

Committed to reducing our own carbon emissions
As part of our contribution to fight climate change, we are committed to reducing our own carbon footprint and to setting ambitious reduction targets in line with climate science. In February 2021, wecommitted to the Science Based Targets initiative (SBTi) and follow SBTi’s methodology when accounting for and setting targets for reduction of greenhouse gas (GHG) emissions. In 2021, our own carbon footprint was 23% lower than in 2019. Our ambition is to achieve net zero operations before the end of this decade, and we are working on finalizing our net zero ambition for our entire value chain.

Major decarbonization events in 2021

December 31: Topsoe announced the divestment of its ownership share in Faradion. Topsoe will continue focusing on LNMO battery technology and will build a pilot plant. Partnership with Morrow established.
December 2: Topsoe’s ClearView™ solution chosen by DCM Shriram Ltd for digitalizing its ammonia facility at Kota, India.
October 31-November 12: Topsoe participated at COP26 and delivered insights on how to decarbonize the hard-to-abate sectors including aviation.
October 18: Topsoe chosen as supplier for blue ammonia technology at Air Products’ $ 4.5 billion clean energy complex in Louisiana, USA.
October 14: Topsoe put demonstration plant into operation for production of sustainable methanol from biogas.
October 12: Partnership announced between Dow and Topsoe to turn waste plastics into circular plastics.
August 10: Phillips 66 started producing renewable diesel based on Topsoe’s HydroFlex^TM solution.
August 5: Marathon Petroleum Corp. started producing renewable diesel in North Dakota, USA, based on Topsoe’s HydroFlex^TM solution.
July 22: Air Products chose Topsoe’s low-carbon SynCOR^TM technology for a blue hydrogen energy complex in Canada.
July 13: Topsoe took final investment decision on building a catalyst plant in Texas, USA, to meet customer demand.
June 25: Topsoe and partners received support from the Danish Energy Technology Development and Demonstration Program (EUDP) for the world’s first industrial-scale dynamic green ammonia demonstration plant.
May 17: CEO Roeland Baan met with a delegation from the US Department of State to discuss innovation to combat climate change.
March 18: Topsoe and Aquamarine announced Memorandum of Understanding with the purpose of building a 100 megawatt green ammonia facility based on SOEC electrolysis.
March 4: Topsoe announced its intention to build a 500 megawatt production facility to produce SOEC electrolyzers supporting the company’s Power-to-X business.
February 22: Topsoe committed to the Science Based Targets initiative and set short-term targets to reduce carbon emissions.