Performance Materials
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3rd quarter 20201 |
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3rd quarter 2021 |
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Change |
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1st nine months 20201 |
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1st nine months 2021 |
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Change |
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€ million |
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€ million |
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% |
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€ million |
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€ million |
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% |
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Core volume growth2 |
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–11.6% |
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+0.7% |
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Sales (external) |
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1,436 |
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2,186 |
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+52.2 |
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3,874 |
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5,883 |
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+51.9 |
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Intersegment sales |
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334 |
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768 |
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>100 |
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882 |
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1,954 |
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>100 |
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Sales (total) |
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1,770 |
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2,954 |
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+66.9 |
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4,756 |
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7,837 |
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+64.8 |
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Change in sales |
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Volume |
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–6.9% |
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+2.0% |
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Price |
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+57.6% |
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+52.5% |
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Currency |
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+1.5% |
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–2.6% |
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Portfolio |
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0.0% |
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0.0% |
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Sales by region |
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EMLA |
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655 |
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994 |
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+51.8 |
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1,813 |
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2,839 |
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+56.6 |
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NA |
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344 |
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565 |
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+64.2 |
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1,007 |
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1,344 |
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+33.5 |
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APAC |
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437 |
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627 |
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+43.5 |
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1,054 |
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1,700 |
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+61.3 |
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EBITDA3 |
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288 |
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755 |
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>100 |
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458 |
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2,053 |
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>300 |
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EBIT3 |
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145 |
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614 |
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>300 |
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29 |
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1,629 |
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. |
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Cash flows from operating activities |
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372 |
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410 |
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+10.2 |
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367 |
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1,263 |
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>200 |
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Cash outflows for additions to property, plant, equipment and intangible assets |
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126 |
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116 |
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–7.9 |
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329 |
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319 |
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–3.0 |
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Free operating cash flow |
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246 |
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294 |
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+19.5 |
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38 |
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944 |
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. |
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In the third quarter of 2021, core volumes sold in the Performance Materials segment were 11.6% lower than in the prior-year quarter. This was chiefly the result of a drop in core volumes sold in the furniture and wood processing industry as well as the construction industry, especially in the EMLA and APAC regions. Global demand was solid, but limited product availability due to the effects of unplanned production stoppages affected our ability to meet it. This restricted the potential for growth.
Sales in the Performance Materials segment were up 52.2% to €2,186 million in the third quarter of 2021 (previous year: €1,436 million). Driven by higher prices for raw materials and energy and a still advantageous competitive situation, average selling prices increased sales by 57.6%. The change in exchange rates had a positive effect on sales of 1.5%. Total volumes sold, however, had a negative effect of 6.9%.
In the EMLA region, sales grew by 51.8% over the prior-year quarter to €994 million (previous year: €655 million) on account of a strong increase in average selling prices. Exchange rate movements were neutral overall in terms of sales. In contrast, a decline in total volumes sold reduced sales considerably. In the NA region, sales were up 64.2% to €565 million (previous year: €344 million). This was mainly attributable to higher average selling prices, which resulted in a strong increase in sales. Exchange rate changes again remained neutral overall with respect to sales, but lower total volumes sold had a slightly negative effect on sales. Sales in the APAC region climbed by 43.5% to €627 million (previous year: €437 million), primarily due to an increase in selling price level, which gave sales a strong boost. Exchange rate changes had a slightly positive effect on sales. However, a decline in total volumes sold reduced sales considerably.
EBITDA in the Performance Materials segment grew over the prior-year quarter to €755 million in the third quarter of 2021 (previous year: €288 million). This was mainly due to a significant increase in margins, which resulted in part from intersegment business. Higher selling prices more than compensated for the countereffect of higher raw material prices. However, higher provisions for variable compensation had a negative effect on earnings.
In the third quarter of 2021, EBIT increased to €614 million (previous year: €145 million).
Free operating cash flow was up 19.5% to €294 million in the third quarter of 2021 (previous year: €246 million), chiefly as a result of the increase in EBITDA. Cash was tied up in working capital, whereas in the prior-year quarter funds had been freed up from working capital, which had a negative effect in the quarter under review.