Business Review
At a glance
- Sales growth of 41.7% to €15,214 million, mainly driven by higher prices
- EBIT before special items of €2,418 million; considerable increase as a result of higher earnings in both divisions
The Materials segment increased sales to third parties by €4,478 million year on year to €15,214 million in 2021. This was due to considerable sales growth in both divisions. The Monomers division increased sales by €2,821 million to €7,922 million. At €7,292 million, sales in the Performance Materials division were €1,657 million above the prior-year figure.
|
Materials |
Performance Materials |
Monomers |
|---|---|---|---|
Volumes |
12.0% |
14.1% |
9.6% |
Prices |
30.0% |
16.2% |
45.2% |
Portfolio |
0.7% |
0.6% |
0.9% |
Currencies |
–0.9% |
–1.5% |
–0.3% |
Sales |
41.7% |
29.4% |
55.3% |
Sales growth was due mainly to significantly higher prices resulting from strong demand alongside low product availability and increased prices for raw materials. Production and supply chain disruptions associated with extreme weather conditions and raw material shortages negatively impacted product market availability. The Monomers division achieved higher prices primarily in isocyanates and polyamides, while the Performance Materials division raised price levels mainly in polyurethane systems and engineering plastics.
Volumes rose significantly as a result of strong demand and contributed to sales growth. The Performance Materials division recorded higher sales volumes in the transportation and consumer goods industries, especially in Asia Pacific and Europe. In the second half of 2021, volume development was however negatively impacted by the semiconductor shortage in the automotive market and the resulting production outages. Overall, sales volumes in the construction industry were slightly above the prior-year level. Higher volumes in Europe more than compensated for lower volumes in North America. The Monomers division increased volumes, especially of polyamide 6.6 following the slight recovery in automotive production in 2021 after the weak prior year due to the pandemic. Sales volumes of methylene diphenyl diisocyanate (MDI) were also higher.
Portfolio effects from the acquisition of the integrated polyamide business from Solvay, which closed as of January 31, 2020, had a slightly positive impact on sales.
Currency effects, primarily relating to the U.S. dollar, had a slightly negative impact on sales development in both divisions.
|
|
2021 |
2020 |
+/– |
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sales to third parties |
|
15,214 |
10,736 |
41.7% |
||||||||||
of which Performance Materials |
|
7,292 |
5,635 |
29.4% |
||||||||||
Monomers |
|
7,922 |
5,101 |
55.3% |
||||||||||
Intersegment transfers |
|
1,250 |
720 |
73.6% |
||||||||||
Sales including transfers |
|
16,464 |
11,456 |
43.7% |
||||||||||
Income from operations before depreciation, amortization and special items |
|
3,208 |
1,714 |
87.2% |
||||||||||
Income from operations before depreciation and amortization (EBITDA) |
|
3,162 |
1,556 |
103.2% |
||||||||||
EBITDA margin |
% |
20.8 |
14.5 |
− |
||||||||||
Depreciation and amortizationa |
|
817 |
1,665 |
–50.9% |
||||||||||
Income from operations (EBIT) |
|
2,345 |
–109 |
. |
||||||||||
Special items |
|
–73 |
–944 |
92.3% |
||||||||||
EBIT before special items |
|
2,418 |
835 |
189.6% |
||||||||||
Return on capital employed (ROCE) |
% |
22.8 |
–1.1 |
− |
||||||||||
Assets |
|
11,286 |
9,118 |
23.8% |
||||||||||
Investments including acquisitionsb |
|
709 |
1,957 |
–63.8% |
||||||||||
Research and development expenses |
|
193 |
182 |
6.1% |
||||||||||
|
||||||||||||||
Materials – sales
By division
Income from operations (EBIT) before special items rose by €1,583 million compared with 2020 to €2,418 million. Both divisions considerably increased EBIT before special items. Earnings growth in the Monomers division was primarily due to higher margins in isocyanates and polyamides. In the Performance Materials division, EBIT before special items was above the prior-year level, mainly driven by positive volume development.
EBIT rose by €2,454 million year on year to €2,345 million. Special items amounted to –€73 million in 2021, after –€944 million in 2020. The special charges in the previous year were primarily attributable to impairments.
Divisions |
Europe |
North America |
Asia Pacific |
South America, |
Total |
|---|---|---|---|---|---|
Performance Materials |
36% |
20% |
39% |
5% |
7,292 |
Monomers |
47% |
19% |
29% |
5% |
7,922 |