Germany’s Covestro (Leverkusen; www.covestro.com) has joined the ranks of plastics producers benefiting from resin shortages and the associated sometimes astronomical polymer prices in the first quarter of 2021. The Leverkusen-based group announced a year-on-year sales increase of 18.8% to EUR 3.3 bn despite opposing currency effects. At EUR 743m, EBITDA almost tripled from the year-earlier period. Net profit of EUR 393m was more than an order of magnitude higher than last year’s figure of EUR 20m, which suffered from the beginning of the coronavirus outbreak (see Plasteurope.com of 07.05.2020).

Since the pandemic initially hit business in Asia, the recovery effects there were particularly pronounced. Production restrictions due to the winter storms in the US (see Plasteurope.com of 10.03.2021) slowed down the generally good business development at best. “Our start to the year was very successful,” said Covestro CEO Markus Steilemann.

In terms of growth rates, the polyurethane business posted the greatest success. Aided by the sometimes extreme shortage of polyols and isocyanates and the associated price increases, sales soared 30.7% to EUR 1.66 bn. EBITDA jumped to EUR 443m, almost nine times the figure from the previous year, but higher provisions for variable remuneration and a brief increase in production costs even had a negative impact on earnings.

The polycarbonate business was a little less turbulent, but still dynamic. Increased sales volumes and sales prices drove sales up by 21.3% to EUR 889m, and EBITDA more than doubled to EUR 222m.

The third group segment, Coatings, Adhesives Specialties, failed to keep pace with the results from polyurethanes and polycarbonates. Revenue rose 4% to EUR 595m on increased sales volumes and slightly higher prices, but EBITDA fell 12.3% to EUR 114m due to higher provisions for variable remuneration.

“We are optimistic about the year as a whole,” Steilemann said. Even before the quarterly figures were published, management had raised the forecasts for the year as a whole (see also Plasteurope.com of 20.04.2021), with Q2 EBITDA estimated at EUR 730m to EUR 870m.

The company plans to use the high momentum to implement a new strategy, Steilemann said. Covestro wants to continue promoting a circular economy, and the company wants to transfer its activities to seven operational business units on 1 July. According to Covestro, these should be “set up according to the respective success factors and tailored to individual customer needs and market requirements”.