Company News
April 7, 2025
Change in Strategy
Covestro scraps energy usage targets in favour of improved efficiency
Article by Sam Baker
Covestro
GERMAN chemicals manufacturer Covestro has scrapped sustainability targets to reduce energy consumption and replaced them with production efficiency goals.
The company is targeting a 20% reduction in CO2 emissions per tonne of product by 2030 compared to the 2020 level. This replaces the goal of halving total energy consumption across main production sites by 2030 compared to 2005 levels.
Thorsten Dreier, CTO of Covestro, said the shift in focus from total energy consumption towards efficiency per tonne of product is because “there is currently not enough renewable energy available at affordable prices to even begin to cover demand”.
Covestro says they have reduced energy consumption by 40% since 2005. However, according to the company’s latest sustainability report, total energy consumption increased by 7% in 2024 to 15,266,000 MWh, with 8% of energy supplied by non-fossil fuel sources.
Dreier added: “We are on the right track, and I am confident that we will achieve our sustainability goals. The energy efficiency measures will make an important contribution to this.”
Covestro has retained both its targets of achieving carbon neutrality by 2035 and to reduce fossil fuel demand by 60% by 2030 and says that the new efficiency goal will amount to a reduction of 550,000 tCO2e. The company’s total scope 1 and 2 emissions in 2024 were 4.85m tCO2e, down 5% on the 2023 figure. However, total emissions, including “downstream” scope 3 contributions, were 23.39m tCO2e, a 9% increase on 2023. While Covestro aims to achieve net-zero scope 3 emissions by 2050, the company also expects them to rise by 3.6m tCO2e by 2035.
Geraint Evans, a Fellow of IChemE and chair of the institution’s clean energy special interest group, said he was “encouraged” by the broad climate-neutrality goal. However, he called for a “stronger recognition of clean energy use within these new targets related to both climate change and impacts on air, land and water”.
Evans added: “We support the need for companies to regularly review their climate action targets to monitor progress, to keep them relevant and achievable, and to continuously improve.”
Plant improvements
The changes to Covestro’s sustainability targets were accompanied by an upgrade to Europe’s biggest toluene diisocyanate (TDI) production plant in Dormagen, Germany, which the company says will now use 80% less energy than the conventional process. Covestro claims emissions at the new plant will be reduced by 22,000 tCO2e per year.
The upgrades to the plant include a new reactor that uses generated reaction energy for steam production to power further manufacturing.
Christine Mendoza-Frohn, Covestro’s head of materials sales performance in Europe, the Middle East and Africa, said: “With the successful modernisation, we can now offer our customers TDI with an even better carbon footprint.
“This supports our customers in achieving their own sustainability goals and strengthens our position as a reliable partner for climate-neutral and circular solutions.”
April 3, 2025
Bassett Furniture Outlook Post Tariffs
Bassett Furniture manufactures living, dining, bedroom, outdoor and upholstered furniture in Virginia and North Carolina.
Bassett builds profitability in Q1; CEO talks price plan in wake of tariffs
Bobby Dalheim //Senior Editor of Case Goods and Global Sourcing//April 3, 2025
BASSETT, Va. – Bassett Furniture reported consolidated first quarter sales of $82.2 million, a decrease of 5.1% from last year. However, when considering that last year’s quarter had an extra week, sales increased 2.2%.
The company reported positive operating income of $2.5 million, compared to a loss last year of $2.4 million. This marks the second consecutive quarter of profitability, which followed five straight quarters of losses previously.
Improved wholesale margins in the quarter drove company gross margin to 57%, a 170 basis point increase over the prior year, and marking some of the highest levels ever seen, according to the company.
Considering the extra week, wholesale sales climbed 4.2% to $52.9 million. Margins grew 250 basis points due to gains in Bassett Custom Upholstery and manufacturing efficiency gains.
In retail, with the extra week considered, sales increased 6.8% to $53.3 million. Gross margin in the segment fell 80 basis points due to lower margins in in-line and clearance goods, as the company said it became more aggressive in cycling through unproductive inventory.
“We had a strong December and January, due in part to the shorter time frame between Black Friday and Christmas,” said Rob Spilman, CEO. “The sales environment was a little more challenging in February.”
Tariffs were, of course, a talking point on the earnings call.
“Tariffs have been top of mind for several months and especially since 4 p.m. yesterday,” Spilman said. “Although 79% of our wholesale shipments in the first quarter were manufactured or assembled in the U.S., many materials used in the process, like fabric and plywood, will now be exposed to tariffs, as will the remaining 21% of our product.
“The entire industry is working with outside experts to gain clarity on this unusual situation. We will determine what this means for our pricing structure on goods that are affected over the next several days. We’re thinking about everything. We’ve been reaching out to our best customers.
“If it stays like it is, we’re going to have to increase prices at some level.”
Spilman said on an earnings call that it’s not feasible to bring the remaining 21% of the company’s product to the U.S. to be made domestically.
“We can certainly emphasize the domestic product more prominently if we choose to do so,” Spilman said. “But we have some nice selling imported product that’s really making a difference for us. We have to study that. We do have some flexibility with our five U.S. factories, and we’re not totally reliant on imports.”
Spilman gave his overall outlook:
“Our strategic plan for 2025 was designed to weather another year of tepid demand and to keep us disciplined and focused on growth. Our management team is running with a leaner mindset.
“We plan for housing sales to remain slow and we’re moving to react quickly to the ups and downs and economic data and changes from Washington. Last week’s report that consumer confidence is plummeting is disconcerting, but we believe the steps we’ve taken will help us run efficiently and get through this tough furniture economy.”
April 2, 2025
L & P Sells Aerospace Segment
Leggett & Platt Sells Its Aerospace Products Group for $285M
- Leggett & Platt (NYSE:LEG) said on Wednesday that it has signed an agreement to sell its Aerospace Products Group to affiliated funds managed by Tinicum Incorporated for a cash purchase price of $285M.
- The after-tax cash proceeds are expected to be approximately $240M.
- The Aerospace Products Group is a supplier of complex, highly engineered tube and duct assemblies for use primarily in commercial and military aircraft platforms and space launch vehicles.
- The business comprises seven manufacturing facilities located in the U.S., UK, and France and approximately 700 employees with net trade sales of $190M in 2024.
- This divestiture is part of the ongoing strategic business review, aimed at determining which businesses are the right long-term fit for the company.
March 27, 2025
IPDI Force Majeure
Evonik Declared Force Majeure for IPDI Supply
PUdaily | Updated: March 27, 2025
On March 24,2025, Evonik declared force majeure for the supply of product VESTANAT® IPDl with immediate effect. Due to unforeseeable and unavoidable technical problems at oursupplier, production is significantly impacted with immediate effect.
Evonik therefore will not be able to supply the confirmed or ordered or otherwise requested quantities of VESTANAT® IPDl tentatively within the next weeks. As of now,Evonik unfortunately cannot determine how long the situation will last and will keep you informed.
March 20, 2025
Klaussner Revival
Klaussner’s Leonardo is a six-piece sectional.
Investment fuels a new chapter for Klaussner, with a North Carolina factory and showroom planned
Cindy W. Hodnett //Executive Editor of Brand Development//March 19, 2025
HIGH POINT — When Klaussner Home Furnishings abruptly closed its doors in 2023, numerous retailers were left in the lurch, including John Garg, CEO of Jennifer Furniture.
At the time, Garg told Furniture Today that the sudden shutdown was a “worse situation than COVID for me” and one that was a “major loss we’re taking for making no mistakes in our business.”
Fast forward to 2025, and not only has Garg weathered the storm that followed Klaussner’s closing, he is actually leading the team that is reintroducing the Klaussner brand to the industry and consumers. Following his purchase of the U.S. market trading rights last year, Garg debuted Klaussner upholstery at retail in five Jennifer Furniture stores in November, and the strong response is fueling continued growth and investment.
Noting that Jennifer Furniture is up 25% year-over-year in sales and more than 40% this month, Garg explains that the time is right for expanding the Klaussner line, adding that the strategy implementation toward future growth is already underway.
“We are not just relaunching a brand; we are redefining American-made furniture with innovation, quality and craftsmanship at its core,” Garg said. “With the support of Jennifer Furniture, Klaussner is set to reclaim its position as a top national brand, offering a diverse range of motion furniture, sleepers, sectionals and stationary frames.”
A multifaceted “game plan” is in place with numerous strategies, including the spring opening of a state-of-the-art production facility in North Carolina that will focus on stationary and slipcover frames and the expansion of a distribution network of key warehouse collaborations in 40 states. Additionally, Garg and his team are focused on strengthening the company’s e-commerce partnerships with Wayfair, Amazon, Costco and others, while also preparing to open a to-the-trade flagship showroom in High Point by the fourth quarter of this year.
“We’re planning a 30,000-square-foot showroom in High Point, and we’ll be finalizing that deal sooner rather than later,” Garg said.
In addition to the physical growth, Garg and his team launched the Klaussner.com website earlier this month, and the early response has been strong, underscoring his belief in the brand as well as multiplatform marketing and social media.
Acknowledging that there are currently notable challenges in the home furnishings industry, Garg added that he also feels there is a lot of opportunity for U.S. companies. Consequently, to ensure continued growth against a backdrop of geopolitical economic uncertainty, he said he plans to follow sound business practices such as controlling expenses, working with the right partners and coaching the sales team to tell the story of a quality product.
“The American furniture market is never going to go away, and we want to support that and build furniture for middle-class American consumers who just want to have a better product,” said Garg. “People are craving the right mix of style, color and quality, and we’re creating it.”
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