Report on Economic Position – Results of Operations, Financial Position, and Net Assets of the Covestro Group

Net Assets

Total assets were down €292 million as compared with December 31, 2022, to €14,293 million as of June 30, 2023.

Noncurrent assets decreased by €249 million to €7,667 million (December 31, 2022: €7,916 million), largely due to a decline in property, plant and equipment and other intangible assets. At the same time, current assets were also down €43 million to €6,626 million (December 31, 2022: €6,669 million). This change is attributable in particular to the decline in cash and cash equivalents described in the “Financial Position” section. A rise in other current financial assets and in other receivables were the main offsetting factors.

• See “Financial Position.”

Equity decreased by €245 million to €6,877 million, compared with €7,122 million as of December 31, 2022. The main reasons for the decline are negative foreign exchange differences and the acquisition of treasury shares. Offsetting movements include in particular the return on plan assets and income after income taxes for the first half of 2023.

Noncurrent liabilities were up €65 million to €4,473 million as of June 30, 2023 (December 31, 2022: €4,408 million), mainly as a result of higher noncurrent financial liabilities. This was set against lower deferred tax liabilities and a decrease in provisions for pensions and other post-employment benefits.

The net defined benefit liability for post-employment benefits (provisions for pensions and other post-employment benefits less net defined benefit asset) was down by €47 million in the reporting year to €383 million (previous year: €430 million). This is above all due to the return on plan assets.

Current liabilities were down €112 million to €2,943 million as of the reporting date (December 31, 2022: €3,055 million). The main factor driving this development was a decline in trade accounts payable, while other provisions were higher than on December 31, 2022.