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Urethane Highlights from Covestro Investors Call
November 3, 2025
Covestro AG (COVTY) Q3 2025 Earnings Call Transcript
Oct. 30, 2025 12:36 PM ETCovestro AG (COVTY) Stock, CVVTF StockCOVTY, CVVTF
Covestro AG (OTCPK:COVTY) Q3 2025 Earnings Call October 30, 2025 10:00 AM EDT
Company Participants
Ronald Kohler – Head of Investor Relations & Corporate Controlling
Christian Baier – CFO & Member of Management Board
Carsten Intveen – Investor Relations Director
Christian Baier
CFO & Member of Management Board
Thank you, Ronald, and good afternoon, everybody. I would like to start my presentation with some insights into a recent acquisition. Following the successful completion of the purchase of Pontacol in Q3 2025, Covestro has signed another value-accretive transaction, which is expected to close in Q1 2026, depending on regulatory approvals. This deal will also benefit our Solutions & Specialties segment with the acquisition of 2 HDI derivative production facilities from Vencorex in Rayong, Thailand and Freeport in the U.S.
This strategic move enhances Covestro’s global aliphatics production footprint in attractive growth regions, particularly the U.S. and Asia Pacific. Aliphatics isocyanates are essential raw materials for light stable coatings, paints and adhesives, primarily used in the mobility sector, but also in construction and furniture applications. The acquisition strengthens Covestro’s position in the coatings and adhesives market, expanding its capacity to meet customer demand across key regions.
After Solutions & Specialties, we now turn to the Performance Materials segment. Sales declined 16.2% year-over-year, driven by negative contributions of 9.8% from pricing, 3.3% from FX and 3.1% from volumes. The volume reduction was primarily attributable to production disruptions in TDI and basic chemicals stemming from the Dormagen incident. Quarter-over-quarter, sales declined in EMLA and North America, while APAC was flat. The Q3 ’25 EBITDA of EUR 174 million is higher year-over-year, mainly due to an increase and — mainly due to an insurance reimbursement and cost savings, while pricing delta, volume and FX all contributed negatively.
Sebastian Bray
Joh. Berenberg, Gossler & Co. KG, Research Division
I have 2, please. The first to come back on Dormagen. Is this done in January of ’26, the plant is fixed and everything goes back online? Or is it not quite that simple? And my second question was on the comments around September mark-to-market pricing for key products implying about EUR 750 million of EBITDA for the year FY ’25. And I’m looking at MDI, a little bit of polycarbonate and some other commodity prices, and these all appear to have deteriorated significantly in excess of raw material prices through October. If you were to perform the same analysis again with mark-to-market October prices, is EUR 700 million a more reasonable figure? Or does it not differ very much?
Christian Baier
CFO & Member of Management Board
Yes. Thank you, Sebastian, for your questions. Happy to address those. I think with respect to Dormagen, it is basically a multifold analysis that is being done. We already have ramped up parts of the various production entities. I think the key one was to restore relevant parts of the power supply in order to also ramp up trains on various of the subproducts. But just answering specifically your question, no early in January ’26, this is not all going to be fixed at that point of time, but we will be ramping up throughout that year on the key products in order to then basically come back to full TDI availability at that point of time, but we’re very confident together with the external partners that are important here also on that external fire incident to ramp up reasonably quickly at that point of time.
With respect to the September mark-to-market, yes, certainly, there is always some fluctuations between the various months, but we very much remain confident with the guidance range that we have narrowed today of this also being the relevant one to look at for the full year outlook also on the back of current trends that we see in the last couple of weeks.
Sebastian Bray
Joh. Berenberg, Gossler & Co. KG, Research Division
Could I just follow up on this? So we’re comparing Q4 versus Q3, I appreciate there are various bits and pieces of noise around semiconductor supply to automotive in Europe and so on. But it is notable how much some of these prices have declined, let’s say, October versus year average — versus quarter average for quarter 3. Is this because one who are ramping up further MDI supply? Is it entirely demand led? What is your own view on why prices are seemingly weak in October?
Christian Baier
CFO & Member of Management Board
Yes. Well, as we are not commenting then on competition, but what we basically see is some headwinds certainly on the products that you quoted. It’s in the end a combination of various factors that we see there. There certainly is demand development that also from a seasonal perspective is ramping in, providing some pressure. And given that we have seen some additional volumes in this year, hitting that demand situation, supply-demand certainly is something to be improving over time. But at the moment, that’s the balance that we see. And still, it’s consistent with our expectations for the full year.
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