Polyurethanes

Second Quarter of 2021

In the second quarter of 2021, core volumes sold in the Polyurethanes segment grew by 27.8% over the prior-year quarter, which had been heavily affected by the coronavirus pandemic. Core volumes sold were up in all main customer industries across the three regions. This was particularly evident in the construction industry as well as in the automotive and transportation industry. In contrast, the consequences of the unplanned weather-related production stoppages in the NA region in the first quarter of 2021 continued to be felt well into the second quarter of 2021. This led to limited product availability and impaired our growth potential.

The Polyurethanes segment’s sales more than doubled over the prior-year quarter to €1,841 million (previous year: €913 million). Key drivers of this development were an increase in average selling prices, which lifted sales by 78.5%, and especially a favorable competitive situation. Growth in total volumes sold also had a positive effect on sales of 29.1%. In contrast, exchange rate developments had a negative impact on sales of 6.0%.

The EMLA region’s sales more than doubled to €874 million (previous year: €359 million). Higher selling prices and growth in total volumes sold contributed substantially to the increase in sales. However, exchange rate changes had a slightly negative effect on sales. In the NA region, sales were up by 71.8% to €457 million (previous year: €266 million). This was the result of a massive rise in average selling prices and strong increase in total volumes sold, both factors which positively affected sales. In contrast, the development of exchange rates pushed sales down significantly. Sales in the APAC region were up by 77.1% to €510 million (previous year: €288 million). A higher selling price level and positive trend in total volumes sold each had a substantially positive effect on sales. Exchange rate movements had a slightly negative impact on sales.

In the second quarter of 2021, the Polyurethanes segment’s EBITDA rose over the prior-year quarter, increasing to €452 million (previous year: €–24 million). The main drivers of this development were the increase in selling prices, which offset the contrasting effect of higher raw material prices and led to higher margins, and the growth in total volumes sold. However, higher provisions for variable compensation reduced earnings.

EBIT advanced to €348 million (previous year: €–130 million).

Free operating cash flow climbed to €175 million (previous year: €–77 million). This was mainly due to the sharp rise in EBITDA, which stood in contrast to an increase in funds tied up in working capital and higher cash outflows for additions to property, plant and equipment.

First Half of 2021

Core volumes sold in the Polyurethanes segment increased by 13.7% in the first half of 2021 in contrast to the prior-year period, which had been adversely affected by the coronavirus pandemic. This development was attributable to the growth in core volumes sold in all main customer industries, especially the automotive and transportation industry as well as the construction industry, particularly in the EMLA and APAC regions. However, the aforementioned effects of the unplanned weather-related production stoppages in the NA region limited product availability and growth potential during the first half of 2021.

In the same period, the segment’s sales were up by 60.3% to €3,506 million (previous year: €2,187 million). Higher selling prices attributable to an advantageous competitive situation and growth in total volumes sold had positive effects on sales of 53.8% and 12.3%, respectively. Exchange rate changes reduced sales by 5.8%.

In the first half of 2021, EBITDA increased to €895 million (previous year: €26 million). Higher selling prices more than compensated for the rise in raw material prices and increased margins. Likewise, the increase in total volumes sold had a positive effect on EBITDA. However, higher provisions for variable compensation had a negative effect on earnings.

EBIT rose to €688 million (previous year: €–181 million).

Free operating cash flow was up, amounting to €306 million (previous year: €–247 million), largely due to the improvement in EBITDA. This increase stood in contrast to greater funds tied up in working capital and higher cash outflows for additions to property, plant, equipment and intangible assets.