Polyurethanes
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1st quarter 2019 |
1st quarter 2020 |
Change |
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€ million |
€ million |
% |
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Core volume growth1 |
–0.2% |
–3.6% |
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Sales |
1,476 |
1,274 |
–13.7 |
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Change in sales |
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Volume |
+3.0% |
–2.5% |
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Price |
–29.4% |
–10.8% |
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Currency |
+2.1% |
+0.7% |
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Portfolio |
0.0% |
–1.1% |
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Sales by region |
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EMLA |
669 |
589 |
–12.0 |
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NAFTA |
411 |
395 |
–3.9 |
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APAC |
396 |
290 |
–26.8 |
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EBITDA |
157 |
50 |
–68.2 |
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EBIT |
57 |
(51) |
. |
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Operating cash flows |
4 |
(86) |
. |
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Cash outflows for additions to property, plant, equipment and intangible assets |
102 |
84 |
–17.6 |
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Free operating cash flow |
(98) |
(170) |
+73.5 |
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In the first quarter of 2020, core volumes in Polyurethanes declined by 3.6% from the prior-year quarter. The major contributing factors here were a downturn in volumes in the electrical, electronics and household appliances sector and the automotive industry.
Sales in the Polyurethanes segment were down by 13.7% to €1,274 million in the first quarter of 2020 (previous year: €1,476 million). Changes in average selling prices resulted in sales falling 10.8%, while total volumes sold were responsible for a 2.5% dip in sales. The drop in prices was primarily attributable to increased competitive pressure worldwide compared with the previous year. Exchange rate fluctuations gave sales a 0.7% boost. Moreover, the portfolio effect from the sale of the European systems house business in the fourth quarter of 2019 negatively affected sales by 1.1%.
In the EMLA region, sales fell 12.0% from the prior-year quarter to €589 million (previous year: €669 million), mainly due to a significant decline in average selling prices. Total volumes saw a modest increase, although the previously mentioned portfolio effect depressed sales slightly. Exchange rate fluctuations had no notable overall impact on sales. The NAFTA region’s sales were down 3.9% to €395 million (previous year: €411 million) on account of significantly lower selling prices. In contrast, higher total volumes and exchange rate movements increased sales slightly. In the APAC region, sales slid by 26.8% to €290 million (previous year: €396 million) chiefly due to the effects of the coronavirus pandemic. A significant drop in both total volumes and average selling prices affected sales adversely. In contrast, exchange rate changes improved sales slightly.
EBITDA in the Polyurethanes segment decreased 68.2% from the prior-year quarter, falling to €50 million in the first quarter of 2020 (previous year: €157 million). Lower selling prices cut deeply into margins despite a decline in raw material prices. A downturn in volumes also had a negative effect on EBITDA.
EBIT was down to minus €51 million in the first quarter of 2020 (previous year: €57 million).
In the first quarter of 2020, free operating cash flow fell by 73.5% to minus €170 million (previous year: minus €98 million), mainly due to the decline in EBITDA.