Coatings, Adhesives, Specialties
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1st quarter 2020 |
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1st quarter 2021 |
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Change |
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€ million |
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€ million |
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% |
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Core volume growth1 |
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–5.2% |
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+7.1% |
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Sales |
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572 |
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595 |
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+4.0 |
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Change in sales |
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Volume |
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–7.1% |
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+5.6% |
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Price |
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–3.9% |
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+2.4% |
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Currency |
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+1.1% |
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–4.0% |
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Portfolio |
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+1.1% |
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0.0% |
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Sales by region |
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EMLA |
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279 |
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268 |
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–3.9 |
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NA |
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139 |
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127 |
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–8.6 |
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APAC |
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154 |
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200 |
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+29.9 |
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EBITDA |
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130 |
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114 |
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–12.3 |
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EBIT |
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100 |
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85 |
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–15.0 |
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Cash flows from operating activities |
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40 |
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45 |
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+12.5 |
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Cash outflows for additions to property, plant, equipment and intangible assets |
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25 |
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23 |
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–8.0 |
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Free operating cash flow |
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15 |
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22 |
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+46.7 |
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In the first quarter of 2021, core volumes sold in the Coatings, Adhesives, Specialties segment rose by 7.1% over the prior-year quarter, which had been adversely affected by the coronavirus pandemic, especially in the APAC region. Volumes grew in all main customer industries, especially the furniture and wood processing industry. The main contributor to this trend was positive volume growth in the APAC region. At the same time, raw material bottlenecks in the Coatings, Adhesives, Specialties segment in the quarter under review led to reduced availability of products and curtailed growth opportunities.
In the first quarter of 2021, sales in the Coatings, Adhesives, Specialties segment rose by 4.0% to €595 million (previous year: €572 million). An increase in total volumes sold and higher selling prices had a positive effect on sales of 5.6% and 2.4%, respectively. This stood in contrast to a change in exchange rates, which reduced sales by 4.0%.
Sales in the EMLA region were down by 3.9% to €268 million (previous year: €279 million), chiefly due to a slight decrease in total volumes sold. In contrast, higher average selling prices modestly improved sales. Exchange rate movements were neutral overall in terms of sales. In the NA region, sales dropped by 8.6% to €127 million (previous year: €139 million). Changes in exchange rates, which put significant downward pressure on sales, was the main contributor to this development. In addition, a slight negative effect was exerted on sales by the decline in total volumes sold. The development of the selling price level lifted sales somewhat in contrast. Sales in the APAC region rose by 29.9% to €200 million (previous year: €154 million), mainly because of a considerable increase in total volumes sold. Moreover, higher average selling prices caused sales to rise slightly. However, the change in exchange rates brought down sales substantially.
EBITDA in the Coatings, Adhesives, Specialties segment declined by 12.3% from the prior-year quarter to €114 million in the first quarter of 2021 (previous year: €130 million). Higher provisions for variable compensation and a temporary increase in cost of goods sold, mainly due to unplanned production bottlenecks, resulted in a reduction in earnings. In contrast, a higher selling price level and a positive volume effect contributed to increasing earnings.
In the first quarter of 2021, EBIT dropped by 15.0% to €85 million (previous year: €100 million).
Free operating cash flow grew by 46.7% to €22 million in the first quarter of 2021 (previous year: €15 million). The decrease in funds tied up in working capital compared to the prior-year quarter and lower cash outflows for additions to property, plant and equipment had a positive effect on free operating cash flow. This stood in contrast to a decline in EBITDA, which had a negative effect.