Chemicals

Q1 2020

Sales¹ in the Chemicals segment were considerably lower than in the first quarter of 2019. The Petrochemicals division in particular saw a considerable decline in sales, while the Intermediates division recorded a slight decrease.

Sales development was driven by lower prices across all business areas in both divisions. This was attributable to weaker demand as a consequence of the corona pandemic, higher product availability on the market and lower raw materials prices.

Positive currency effects in both divisions had a slight offsetting effect.

Volumes were on a level with the prior-year quarter. Higher sales volumes in the Intermediates division, especially in Europe and Asia, were offset by lower volumes in the Petrochemicals division.

Income from operations (EBIT) before special items declined considerably compared with the first quarter of 2019. The considerable decrease affected both divisions, but in particular the Petrochemicals division, and was mainly attributable to lower margins and higher fixed costs.

In the Petrochemicals division, higher margins for steam cracker products in North America due to significantly lower raw materials prices were unable to compensate for the significantly lower margins in the ethylene and propylene value chains, especially in Europe and Asia. Fixed costs rose, mainly due to price-related impairment losses on inventories.

The Intermediates division recorded lower margins, particularly in the acids and polyalcohols business and in the butanediol and derivatives business. Fixed costs were higher as a result of the gradual startup of the new acetylene plant in Ludwigshafen, Germany.