Business Development by Segment

Coatings, Adhesives, Specialties

Key data Coatings, Adhesives, Specialties

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4th quarter 20181

 

4th quarter 2019

 

Change

 

20181

 

2019

 

Change

 

 

€ million

 

€ million

 

%

 

€ million

 

€ million

 

%

1

Reference information was not restated, see bote 2.1 “Financial reporting standards applied for the first time in the reporting period.”

2

Reference values calculated on the basis of the definition of the core business effective March 31, 2019.

Core volume growth2

 

–2.2%

 

+6.2%

 

 

 

+2.3%

 

–1.0%

 

 

Sales

 

534

 

533

 

–0.2

 

2,361

 

2,369

 

+0.3

Change in sales

 

 

 

 

 

 

 

 

 

 

 

 

Volume

 

+0.3%

 

+0.1%

 

 

 

+3.5%

 

–2.1%

 

 

Price

 

0.0%

 

–4.2%

 

 

 

+0.6%

 

–1.1%

 

 

Currency

 

+0.6%

 

+1.9%

 

 

 

–2.6%

 

+2.3%

 

 

Portfolio

 

0.0%

 

+2.0%

 

 

 

0.0%

 

+1.2%

 

 

Sales by region

 

 

 

 

 

 

 

 

 

 

 

 

EMLA

 

240

 

224

 

–6.7

 

1,117

 

1,052

 

–5.8

NAFTA

 

129

 

129

 

0.0

 

519

 

562

 

+8.3

APAC

 

165

 

180

 

+9.1

 

725

 

755

 

+4.1

EBITDA

 

63

 

62

 

–1.6

 

464

 

469

 

+1.1

EBIT

 

39

 

32

 

–17.9

 

371

 

352

 

–5.1

Operating cash flows

 

107

 

170

 

+58.9

 

309

 

349

 

+12.9

Cash outflows for additions to property, plant, equipment and intangible assets

 

36

 

55

 

+52.8

 

106

 

158

 

+49.1

Free operating cash flow

 

71

 

115

 

+62.0

 

203

 

191

 

–5.9

In the 2019 fiscal year, core volumes in Coatings, Adhesives, Specialties were down 1.0% from the prior year. This development was driven primarily by weaker automotive industry demand for coating precursors.

At €2,369 million, the Coatings, Adhesives, Specialties segment’s sales remained stable year over year (previous year: €2,361 million). A decrease in total volumes sold and lower selling prices had negative effects on sales of 2.1% and 1.1%, respectively. In contrast, exchange rate movements had a positive impact of 2.3%. The step acquisition of shares and subsequent full consolidation of Japan-based DIC Covestro Polymer Ltd. also gave sales a 1.2% boost.

Sales in the region dropped by 5.8% to €1,052 million (previous year: €1,117 million) as a result of a sharp decline in total volumes sold. Changes in average selling prices and exchange rates collectively had no notable effect on sales. In the region, sales grew by 8.3% to €562 million (previous year: €519 million). The growth in total volumes sold and higher selling price levels resulted in a slight improvement in sales. In addition, exchange rate fluctuations had a significant positive impact on sales. Sales in the region increased by 4.1% to €755 million (previous year: €725 million). A modest positive effect from total volumes sold and exchange rate movements compensated for the minimal decrease in average selling prices. Moreover, the portfolio effect from the step acquisition of shares and subsequent full consolidation of Japan-based DIC Covestro Polymer Ltd. improved sales slightly.

Coatings, Adhesives, Specialties
quarterly sales

€ million

Coatings, Adhesives, Specialties Quarterly sales (bar chart)

Coatings, Adhesives, Specialties
quarterly EBITDA

€ million

Coatings, Adhesives, Specialties Quarterly EBITDA (bar chart)

1 Reference information was not restated, see note 2.1 “Financial reporting standards applied for the first time in the reporting period.

was up by 1.1% from the prior-year period to €469 million (previous year: €464 million). Lower selling prices were not balanced out by a decline in raw material prices and therefore cut into margins. Lower volumes likewise adversely influenced EBITDA. Conversely, exchange rate effects and the portfolio effect of the step acquisition of shares of Japan-based DIC Covestro Polymer Ltd. improved sales. In addition, the one-time gain from the remeasurement of shares of DIC Covestro Polymer Ltd. in Japan previously accounted for under the equity method had a positive effect on EBITDA of €19 million.

sank by 5.1% to €352 million (previous year: €371 million).

decreased by 5.9% to €191 million (previous year: €203 million). The main reason for this was the increase in cash outflows for additions to property, plant and equipment, which stood in contrast to the overall lower funds tied up in working capital.

EMLA
Comprises all countries in Europe, the Middle East, Africa and Latin America (excluding Mexico) in which Covestro is active
NAFTA
Region comprising the United States, Canada and Mexico in which Covestro is active
APAC
Comprises all countries in the Asia and Pacific region in which Covestro is active
EBITDA/earnings before interest, taxes, depreciation and amortization
EBIT plus depreciation and amortization of property, plant, equipment, and intangible assets
EBIT/earnings before interest and taxes
Income after income taxes plus financial result and income tax expense
FOCF/free operating cash flow
Operating cash flows (pursuant to IAS 7) less cash outflows for additions to property, plant, equipment and intangible assets