Jim Ratcliffe Ineos halts dividends for five years to cut debt and fund Belgium plant

Sir Jim Ratcliffe’s Ineos petrochemicals empire is under significant financial pressure after a spree of acquisitions led to soaring debt and forced the company to axe dividend payouts until at least 2030. Ineos, long known for rewarding its owners with substantial yearly dividends, stopped the payments after posting losses in 2024. Net finance costs rose above €1 billion following acquisitions totalling approximately €2.7 billion across the United States, Europe, and Asia.

Credit ratings agency Fitch expects Ineos to delay dividends for five years so the company can focus on reducing its debt burden and invest heavily in a new ethylene plant in Belgium. Group net leverage has ballooned to around eight times earnings this year. Management is determined to bring this down to a target of three times before resuming any shareholder payouts.

Ratcliffe, aged 72, hailing from Failsworth near Manchester, has also been making tough financial decisions at Manchester United. Cost-cutting strategies there have resulted in around 450 job losses. He warned insolvency was a real risk for the football club without dramatic savings. Despite the cutbacks, Ratcliffe has injected over £230 million in fresh investment at United.

Ineos said it is under no obligation to pay dividends, preferring instead to deploy capital into its own operations during periods of market weakness. The reduction in payouts is being touted as evidence of financial discipline and prudent management. Ratcliffe and his co-owners Andy Currie and John Reece, through a parent company in the Isle of Man, have previously benefited from dividends ranging between €23 million and €2.1 billion each year for more than a decade, aside from the pandemic-hit 2020.

Recently the group launched a new debt issuance, marketing a €650 million secured bond to help finance Project One, its ambitious ethylene plant in Belgium. The state-of-the-art plant is set to convert ethane into ethylene for a wide range of products including plastics, textiles, and detergents. With a projected annual capacity of 1.45 million tonnes, Project One is expected to contribute over £600 million to Ineos earnings when operational.

The company continues to streamline its global footprint, closing less profitable assets such as its Grangemouth refinery in Scotland and the Gladbeck phenol facility in Germany, the latter slated for closure by 2027. Credit ratings agencies, including Fitch and Moody’s, have downgraded Ineos’s debt, citing weak global chemical markets, high capital expenditure for Project One, uncertain demand, and volatile pricing across major business areas. The sector remains challenged by oversupply, soft demand, especially in Asia, and persistently high energy costs in Europe.