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By ICN GroupChemical, July 18, 2018

Evonik exceeds half-year expectations

Sales increased to €3.9 billion in the second quarter (prior-year: €3.6 billion), largely due to higher sales volumes and higher selling prices.

Evonik has increased adjusted EBITDA to €742 million in the second quarter of 2018 (prior-year: €640 million). All three chemical segments contributed with excellent operational business development: All three segments were able to increase their adjusted EBITDA as well as EBITDA margin compared to the same quarter of the previous year.

Sales increased to €3.9 billion in the second quarter (prior-year: €3.6 billion), largely due to higher sales volumes and higher selling prices. Adjusted net income was €354 million, which corresponds to adjusted earnings per share of €0.76. The adjusted EBITDA margin rose to 19.2 percent, 1.5 percentage points higher than in the same period of the previous year.

The adjusted EBITDA and adjusted earnings per share are significantly above current market expectations (analyst consensus: €691 million, €0.70 per share). Evonik is therefore obligated to publish preliminary numbers. The group present its final results on August 2, 2018.

“We are continuing to consistently execute our strategy,” says Christian Kullmann, Chairman of the Executive Board. “This is more and more reflected in our operational business development as well. In addition to the continuing strong demand in our growth engines, our strong quarterly results are showing the first signs of success from our efficiency program in administration and sales."

In the first half of the year, Evonik generated sales of €7.5 billion and an adjusted EBITDA of €1.4 billion. Compared to the first half of 2017, sales rose by 4 percent, and adjusted EBITDA by 15 percent. The adjusted EBITDA margin rose from 17.0 to 18.8 percent.

Evonik is well on track in terms of free cash flow development: In contrast to the previous year (H1 2017: -€135 million), free cash flow was positive in the first half of 2018.

Outlook increased

Based on its excellent performance in the first half of the year, Evonik has increased its outlook for the fiscal year 2018 and is now expecting an adjusted EBITDA between €2.60 and €2.65 billion. The company had previously projected an adjusted EBITDA between €2.4 and €2.6 billion.

The outlook for free cash flow has also been increased. Evonik projects a notably higher free cash flow for the fiscal year 2018 compared to prior year. The company had so far forecasted a free cash flow slightly above the level of 2017.

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