Leverkusen, Germany – Weak global demand hit Covestro’s performance in 2023, with group sales falling 20% to €14.4bn, down from €18.0bn the previous year. EBITDA fell by 33.2%, from €1.6bn in 2022 to €1.1bn last year. Net income remained in negative territory, although it rose to -€198m from -€272 a year earlier.
The company said that geopolitical crises had had a lasting negative impact on both global demand and selling prices, and costs for both energy and raw materials remained well above the historical average, particularly in Europe. Sales fell in the light of lower-than-average selling prices and reduced volumes.
Fourth quarter sales dropped by 15.6% to €3.3bn, down from €4.0bn in the 2022 quarter. This was attributed primarily to declining selling prices. EBITDA improved to €132m in the last quarter of 2023, up from the quarterly loss of €38m a year earlier.
In the Performance Materials business segment, a 24% decline in full-year sales from €9.1bn in 2022 to €6.9bn in 2023 was largely attributed to lower selling prices and volumes. Lower margins impacted EBITDA, with last year’s €576m representing a 39% drop on 2022’s €951m.
The decline in sales in the Solutions & Specialties segment was less steep, falling by 15% from €8.6bn in 2022 to €7.3bn in 2023. EBITDA fell by just 1%, from €825m to €817m, largely as a result of improved margins, with lower raw material and energy prices more than compensating for the drop in selling prices. Lower fixed costs and the sale of the additive manufacturing business also had a positive effect.