Coatings, Adhesives, Specialties
|
|
|
|
|
|
|
|||||||||
|
2nd quarter 2019 |
2nd quarter 2020 |
Change |
1st half 2019 |
1st half 2020 |
Change |
|||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
€ million |
€ million |
% |
€ million |
€ million |
% |
|||||||||
|
|||||||||||||||
Core volume growth1 |
–4.7% |
–25.3% |
|
–2.4% |
–15.2% |
|
|||||||||
Sales |
621 |
443 |
–28.7 |
1,248 |
1,015 |
–18.7 |
|||||||||
Change in sales |
|
|
|
|
|
|
|||||||||
Volume |
–4.5% |
–25.8% |
|
–1.7% |
–16.4% |
|
|||||||||
Price |
–0.4% |
–3.2% |
|
+0.6% |
–3.5% |
|
|||||||||
Currency |
+2.2% |
+0.3% |
|
+2.6% |
+0.7% |
|
|||||||||
Portfolio |
+1.4% |
0.0% |
|
+0.7% |
+0.5% |
|
|||||||||
Sales by region |
|
|
|
|
|
|
|||||||||
EMLA |
277 |
188 |
–32.1 |
571 |
467 |
–18.2 |
|||||||||
NAFTA |
144 |
101 |
–29.9 |
288 |
240 |
–16.7 |
|||||||||
APAC |
200 |
154 |
–23.0 |
389 |
308 |
–20.8 |
|||||||||
EBITDA |
150 |
60 |
–60.0 |
296 |
190 |
–35.8 |
|||||||||
EBIT |
120 |
28 |
–76.7 |
238 |
128 |
–46.2 |
|||||||||
Operating cash flows |
38 |
94 |
>100 |
50 |
134 |
>100 |
|||||||||
Cash outflows for additions to property, plant, equipment and intangible assets |
40 |
29 |
–27.5 |
64 |
54 |
–15.6 |
|||||||||
Free operating cash flow |
(2) |
65 |
. |
(14) |
80 |
. |
|||||||||
Second quarter of 2020
In the second quarter of 2020, the Coatings, Adhesives, Specialties segment saw core volumes decline by 25.3% from the prior-year quarter. The coronavirus pandemic led to considerably weaker demand from our main customer industries. This is primarily reflected in the negative development of volumes sold in the automotive and transportation industry and in the furniture and wood processing industry as well.
Sales in the segment dropped by 28.7% to €443 million (previous year: €621 million). A decline in total volumes had a negative effect on sales of 25.8%, while lower average selling prices reduced sales by 3.2%. Exchange rate fluctuations increased sales by 0.3%.
In the EMLA region, sales decreased by 32.1% to €188 million (previous year: €277 million), mainly on account of a sharp drop in total volumes sold. In addition, lower selling prices pushed sales down slightly. Exchange rate fluctuations had no material effect on sales. Sales in the NAFTA region dropped by 29.9% to €101 million (previous year: €144 million) as a result of a steep decline in total volumes sold. At the same time, average selling prices reduced sales somewhat, whereas changes in exchange rates had a slight positive effect on sales. In the APAC region, sales were down 23.0% to €154 million (previous year: €200 million). A considerable drop in total volumes and a significantly lower level of selling prices each reduced sales. Exchange rate movements had no noticeable effect on sales.
Coatings, Adhesives, Specialties
Quarterly Sales
€ million
Coatings, Adhesives, Specialties
Quarterly EBITDA
€ million
EBITDA in Coatings, Adhesives, Specialties fell by 60.0% to €60 million in the second quarter of 2020 (previous year: €150 million). This was mainly attributable to reduced volumes and lower margins, which negatively affected EBITDA performance.
EBIT declined by 76.7% to €28 million (previous year: €120 million).
In the second quarter of 2020, free operating cash flow rose to €65 million (previous year: minus €2 million). EBITDA declined, while freed-up working capital increased.
First half of 2020
In the first half of 2020, core volumes in the Coatings, Adhesives, Specialties segment were 15.2% lower than in the prior-year period. The drivers of this development were considerably weaker demand from our main customer industries, especially due to negative performance of volumes sold in the automotive and transportation industry as well as in the furniture and wood processing industry.
Sales in the Coatings, Adhesives, Specialties segment dropped by 18.7% in the same period to €1,015 million (previous year: €1,248 million). Negative effects on sales of 16.4% and 3.5% stemmed from total volumes sold and lower selling prices, respectively. At the same time, exchange rate changes increased sales by 0.7%, and the portfolio effect from the step acquisition of shares and subsequent full consolidation of Japan-based DIC Covestro Polymer Ltd. in the second quarter of 2019 gave sales a 0.5% boost.
In the first six months of 2020, EBITDA decreased by 35.8% compared to the prior-year period, coming in at €190 million (previous year: €296 million). This was primarily due to the drop in total volumes sold and lower margins.
EBIT was down by 46.2% to €128 million (previous year: €238 million).
In the first half of 2020, free operating cash flow increased to €80 million (previous year: minus €14 million). A lower level of cash tied up in working capital more than compensated for the decline in EBITDA.