"We implemented measures early and consistently to protect as best as possible the health of our employees and at the same time maintain operations," said Christian Kullmann, chairman of the management board.
While Evonik is facing challenges in logistics and production, the company’s global network is paying off. Supply chains are intact and there are hardly any restrictions on production worldwide, except for a few government-ordered shutdowns at smaller sites.
At all sites, very high hygiene standards apply. Wherever possible for administrative posts, conditions were created within a very short time to enable working from home and existing flexible working-time models utilized.
"Our efforts in the last three years to cut costs and increase efficiency at the company are now paying off,” said CFO Ute Wolf. “We have a strong balance sheet and a good liquidity cushion.”
Lower volumes and selling prices were responsible for the decline in adjusted EBITDA in the first quarter. Additionally, weak demand and inventory impairments, due to the significantly lower oil price, burdened the Performance Materials segment. Accordingly, the adjusted EBITDA margin declined from 16.4% to 15.8%.
The effects of the coronavirus pandemic on Evonik’s sales and earnings remained modest in the first quarter. Since then it has become much clearer to what extent the pandemic will burden the global economy. That was not yet visible at the beginning of the year.
In light of this, Evonik is adjusting its outlook for the full year 2020. The company is now expecting sales between €11.5 billion and €13 billion and an adjusted EBITDA of between €1.7 billion and €2.1 billion. Previously Evonik was expecting stable sales of around €13.1 billion and adjusted EBITDA of between €2.1 billion and €2.3 billion.