Covestro Group benefited from a strong global demand and buoyant earnings in 2021 as a whole with an increase in sales up 48.5 percent to EUR 15.9 billion (previous year EUR 10.7 billion), the highest ever level in company's history.

Core volumes sold increased by 10 percent year on year, mainly due to additional volumes from the Resins & Functional Materials (RFM) business acquired from DSM. In particular, the rise in selling prices on the back of high demand meant that Group sales increased by 48.5 percent.

EBITDA more than doubled year over year and was EUR 3.1 billion in fiscal 2021 (previous year EUR 1.5 billion), in particular as a result of far higher margins.

Net income more than tripled year over year to EUR 1.6 billion (previous year EUR 459 million), while the free operating cash flow (FOCF) was EUR 1.4 billion and likewise well up on the previous year’s figure of EUR 530 million. The return on capital employed (ROCE) grew to 19.5 percent (previous year 7 percent).

“In the past year we successfully undertook further steps towards a circular economy. Our very good results in fiscal 2021 underscore once more that we are on the right track with our new strategic setup,” said Dr. Markus Steilemann, CEO, Covestro.

“Now we are taking the next steps on our path to a profitable and climate neutral future. After all, one thing is clear: Without our products, the Paris Agreement’s 1.5 degrees target cannot be achieved,” added Steilemann.

Given its very good performance in fiscal 2021, Covestro plans to propose a dividend of EUR 3.40 per share to the Annual General Meeting on April 21, 2022. That is equal to a payout ratio of 41 percent. Covestro redefined its dividend policy last fiscal year. It envisages a payout ratio between 35 and 55 percent of net income in order to create a stronger link to the Group’s overall business situation.

“We can look back on an extremely successful year marked by high demand. Not least, that is reflected in the fact that we were virtually sold out over large stretches of 2021,” said Dr. Thomas Toepfer, CFO, Covestro.

In light of the successful business development, Covestro's Board of Management has also resolved on a share buyback program with a total volume of approximately EUR 500 million over the next two years.

“Major acquisitions are not Covestro's focus at the moment; instead, we believe investing in our own shares is the best investment," added Toepfer.

Covestro is making systematic advances on its path to circular plastics production and has set bold climate targets. The Group is striving to become climate neutral and achieve net zero emissions by 2035. On the path to achieving that, Covestro has already reduced its specific greenhouse gas emissions per metric ton of product produced by 54 percent in 2021 compared to 2005, achieving its sustainability target for 2025 already today.

The company plans to cut greenhouse gas emissions from its own production operations (scope 1) and from external energy sources (scope 2) by 60 percent to 2.2 million metric tons by 2030. In the long run, Covestro aims to use renewable energies only, such as wind power and solar energy, as well as alternative raw materials such as biomass, waste, CO2 or hydrogen within its production processes. In addition, a reduction target for the long-term reduction of indirect greenhouse gas emissions from upstream and downstream processes in the value chain (scope 3) is to follow in 2023.

Covestro also achieved further successes last fiscal year in gradually switching its production sites to green electricity. The company operates cooperation models with energy suppliers who generate onshore and offshore wind power and solar energy so that it can keep on cutting its greenhouse gas emissions. To enable that, the Group signed multiple Power Purchase Agreements for its sites in Belgium, China and Germany in 2021.