Evonik significantly increased its earnings in the second quarter of 2024 despite a persistently difficult economic environment. The final figures confirm the preliminary data announced on July 15: adjusted EBITDA rose by 28 per cent to €578 million compared to the previous year. Free cash flow was clearly positive at €217 million, following a cash outflow of €203 million a year earlier.

“We are cutting our costs and doing our homework - and it shows,” says Chief Executive Officer Christian Kullmann with regard to the ongoing restructuring programs. “We have to rely primarily on ourselves at the moment, as there is no real tailwind from the economy.”

Group sales in the second quarter rose by 1 per cent to €3.93 billion compared to the same period last year. Prices fell by 2 per cent, partly due to the passing on of lower raw material costs. By contrast, prices in the Animal Nutrition business continued to recover. Evonik was able to increase sales volumes by 5 percent. The positive volume development in Specialty Additives stood out, boasting double-digit growth rates. In addition to continued strict cost discipline, lower production costs also contributed to the improvements. The adjusted EBITDA margin rose by 3.1 percentage points to 14.7 per cent.

“We are headed in the right direction, and the improvements in our key financial figures compared to the previous year are really encouraging,” says Chief Financial Officer Maike Schuh. “However, the current recovery compares to a very weak 2023, and we are still a long way from reaching our goals.”

On July 15, Evonik raised its outlook for adjusted EBITDA in 2024. The company now expects the measure in a range between €1.9 billion and €2.2 billion (previous range: €1.7 billion to €2.0 billion). The outlook for the other key financial figures remains unchanged: Sales should reach between €15 billion and €17 billion. Evonik anticipates a cash conversion rate of around 40 percent and a significantly higher ROCE. For the third quarter, Evonik expects adjusted EBITDA to be on par with the second quarter.

The Evonik Tailor Made efficiency program will contribute initial savings from the end of this year. Negotiations on the framework for socially responsible job cuts in Germany have been concluded. Evonik recognized provisions of €238 million in the second quarter to implement these reductions. Excluding the provisions, general administrative expenses in the first half of the year were already down 5 percent compared to the previous year. The provisions are also largely responsible for the negative net income of € -5 million for the second quarter. In the same quarter of last year, the net loss amounted to € -270 million.

Evonik continues to develop its product portfolio in a clear direction. The inauguration of the world's first plant for sustainable biosurfactants on an industrial scale in Slovakia shows how Evonik is driving the green transformation in the cleaning, beauty and personal care industry. Evonik wants to be a leader in this market segment, which has a long-term sales potential of €1 billion. The plant in Slovenská Ľupča is expected to be operating at full capacity by the end of 2026. 

The sale of the superabsorbents business is expected to be completed in the current third quarter. Two of the three business lines that used to form the Performance Materials division will then have a new owner.