Polycarbonates

In the third quarter of 2020, core volumes sold in the Polycarbonates segment rose by 3.6% over the prior-year quarter. This was due to growth in volumes sold in the construction industry across all regions and in the electrical, electronics and household appliances industry thanks to increased demand in the APAC region. In contrast, lower demand in the automotive and transportation industry, primarily in the EMLA region, led to declines in volumes sold.

Sales in the Polycarbonates segment were down by 11.1% to €801 million in the third quarter of 2020 (previous year: €901 million). Changes in selling prices driven by lower raw material prices and exchange rate movements led to a decrease in sales of 8.2% and 3.4%, whereas higher total volumes sold had a positive effect on sales of 3.6%. Moreover, the portfolio effect from the sale of the European polycarbonate sheets business in the first quarter of 2020 caused sales to decline by 3.1% in the third quarter of 2020.

Sales in the EMLA region were down by 14.9% to €239 million (previous year: €281 million). Lower selling prices and the aforementioned portfolio effect had a significant negative impact on sales. In contrast, an increase in total volumes sold boosted sales slightly. Exchange rate movements had no notable effect on sales. In the NAFTA region, sales fell by 21.4% to €154 million (previous year: €196 million). The key drivers here were lower total volumes and exchange rate changes, which each drove sales down substantially. Lower average selling prices had an additional slightly negative effect on sales. The APAC region’s sales dropped 3.8% to €408 million (previous year: €424 million), primarily due to a substantial decline in selling prices. Furthermore, exchange rate movements resulted in a modest decrease in sales, but the change in total volumes pushed sales up sharply.

In the third quarter of 2020, EBITDA in the Polycarbonates segment rose by 12.1% from the prior-year quarter, increasing to €148 million (previous year: €132 million). Improved cost levels as a result of cost-cutting measures had a positive effect on earnings. Higher margins had a positive effect. These resulted from lower raw material prices, which were able to more than offset lower selling prices.

EBIT was up by 64.9% to €94 million in the third quarter of 2020 (previous year: €57 million).

Free operating cash flow grew to €170 million in the third quarter of 2020, an increase of 26.9% (previous year: €134 million). This was attributable to an upturn in EBITDA, an overall increase in funds freed up from working capital and a decrease in cash outflows for additions to property, plant, and equipment compared to the prior-year quarter.