Finance
Covestro trims 2024 profit target again in a tough economy
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(Reuters) -German chemicals maker Covestro lowered the upper end of its full-year core
(Reuters) -German chemicals maker Covestro lowered the upper end of its full-year core profit forecast range on Tuesday for the second time this year, citing lacklustre global demand in a challenging economic environment.
The company, whose main products include foam chemicals used in mattresses, car seats and insulation for buildings, now expects its annual core profit to come between 1 billion and 1.25 billion euros ($1.08 billion-$1.35 billion).
Covestro had previously forecast its 2024 earnings before interest, tax, depreciation and amortisation (EBITDA) at 1 billion to 1.4 billion euros.
“Global demand is intact but remains at a low level. We continue to face challenges in various industries and regions,” CFO Christian Baier said in a statement.
The company’s EBITDA rose 3.6% to 287 million euros during July-September, but slightly missed analysts’ average estimate of 292 million euros in a company-provided consensus.
Last week, Abu Dhabi’s ADNOC said the acceptance period for its voluntary public takeover offer for Covestro of 14.7 billion euros has started, with an end date of Nov. 27.
Covestro’s third-quarter sales came in at 3.60 billion euros, up 1% from last year, but below the consensus of 3.68 billion euros.
($1 = 0.9250 euros)
(Reporting by Bartosz Dabrowski in Gdansk; Editing by Sherry Jacob-Phillips and Subhranshu Sahu)
EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. It is a financial metric used to evaluate a company's operating performance.
Core profit refers to the profit a company makes from its primary business operations, excluding any income from non-operational activities.
Foam chemicals are substances used to create foam products, such as those found in mattresses, car seats, and insulation materials.
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