Covestro increased its volumes sold, in particular in the APAC and EMLA regions, year on year in the second quarter of 2024. Group sales remained stable at € 3.7 billion (previous year: EUR 3.7 billion) due to the fact that selling price levels were lower for demand-related reasons.

EBITDA at Group level fell by 16.9 percent to € 320 million (previous year: EUR 385 million), corresponding to the middle of the previously forecast range of between € 270 million and € 370 million. Lower raw material prices only partially offset the demand-related decline in average sales prices. Net loss in the second quarter of 2024 was € 72 million (previous year: net income of € 46 million), while the free operating cash flow (FOCF) was € –147 million (previous year: € –10 million).

“The market environment remains very challenging,” says Dr. Markus Steilemann, CEO of Covestro. “Our sharp rise in volumes sold shows that we’re prepared for the market recovery. In addition, our transformation program STRONG is creating the necessary conditions for us to further expand our leading position in the global market and secure our competitiveness.”

In view of a rapidly changing market environment, Covestro launched the global transformation program STRONG in June 2024. The Group is therefore making itself even more effective and efficient and is systematically driving its digitalization. As part of STRONG, Covestro is planning to realize global annual savings in material and personnel costs of EUR 400 million by 2028, of which EUR 190 million will be in Germany.

Meanwhile, Covestro expects a narrowed earnings guidance for full-year 2024. Covestro continues to expect challenging economic conditions in the remainder of the year. Covestro has therefore narrowed its guidance for EBITDA and ROCE above WACC and adjusted its forecast for the free operating cash flow for fiscal 2024.

The company now anticipates EBITDA between € 1 billion and €1.4 billion (previously: between €1 billion and € 1.6 billion). Covestro now expects a free operating cash flow of between € –100 million and € 100 million (previously: between € 0 million and € 300 million). For ROCE above WACC, Covestro now anticipates a range between –7.0 percentage points and –4.0 percentage points (previously: between –7.0 percentage points and –2.0 percentage points).

Covestro projects that GHG emissions measured as CO2 equivalents will still be between 4.4 million metric tons and 5.0 million metric tons. The Group anticipates EBITDA for the third quarter of 2024 will be € 250 million to € 350 million.

“We were able to keep our sales stable in the second quarter and reached the middle of our EBITDA guidance. That’s positive news and proof of our resilience,” says Christian Baier, CFO of Covestro. “In view of the continuing challenging economic environment, we have narrowed our earnings guidance for the year as a whole accordingly."