Brenntag recorded a solid performance in the second quarter 2023 broadly in line with expectations. In a challenging market environment, the results of Brenntag Specialties continued to be impacted by negative volume developments in combination with falling sales prices. Brenntag Essentials performed well despite adverse conditions but also showed slower performance compared to last year, which is mainly driven by lower volumes. The results of both divisions compare to the record high quarter of the previous year. The again very high free cash flow demonstrates the strong cash generation capability of the business.

 

In the second quarter 2023, Brenntag generated sales of 4,256.6 million EUR which is 13.7% below the Q2 2022 results. Operating gross profit reached 1,020.8 million EUR, 8.5% below the record high prior year quarter. Operating EBITA came in at 332.2 million EUR, a decline of 25.8% compared to Q2 2022. The free cash flow was very high with 431.7 million EUR (Q2 2022: 157.6 million EUR, +173.9%). This adds up to almost 900 million EUR of free cash flow for the first half of 2023, the highest free cash flow ever recorded in a first 6-month period, and again demonstrates the strong cash generation capability of the business. Earnings per share stood at 1.23 EUR (Q2 2022: 1.86 EUR).

 

Christian Kohlpaintner, Chief Executive Officer of Brenntag SE: “Due to our resilient business model, we saw a solid operational and financial performance of Brenntag in the second quarter of 2023. Given the continued challenging and adverse market environment and compared to the record-high levels of the prior-year quarter, the results are broadly in line with our expectations. In light of the sequential volume recovery seen since the beginning of the year as well as indications that inventory control measures on our customer side are bottoming out, we are confident that the volumes in the second half of 2023 will exceed the volumes in the first six months. Besides our operational efforts, we made good progress in implementing our strategic growth initiatives. With the new divisional setup, we create incrementally more independent, autonomous, and market-leading businesses to accelerate the implementation of our ‘Strategy to Win’.”

 

In March 2023, Brenntag presented a guidance range for the full year of 1.3 billion EUR to 1.5 billion EUR for operating EBITA. As 2023 is further progressed, the company confirms this guidance and specifies it more precisely at 1.3 billion EUR to 1.4 billion EUR of operating EBITA for the full year 2023, thus being at the lower range of the original guidance, driven by overall highly challenging market environment and unfavorable foreign exchange effects.

 

For the second half of 2023, Brenntag expects a continuously tough operating environment, characterized by geo-political concerns, macroeconomic challenges but also a sequentially recovering demand. Due to the sequential volume recovery seen since the beginning of the year as well as indications that inventory control measures on customer side are bottoming out, the company is confident that the second half of 2023 will generate volumes exceeding the first six months of the year.