Sales and Earnings Forecast for the Segments

Sales in the Chemicals segment are expected to decrease slightly in 2023 due to lower prices in both operating divisions. This will be driven by pressure on prices caused by higher product availability overall as new production capacities come on stream and supply chain problems ease. An expected recovery in demand, especially in China, will lead to volume growth in the segment. This will presumably not be able to fully compensate for the negative price effects. The lower prices will also put pressure on margins. Consequently, we are forecasting a considerable decline in EBIT before special items in both operating divisions. In addition, earnings performance will be negatively impacted by significantly higher fixed costs, mainly from invest­ments in the construction of the new Verbund site in Zhanjiang, China, and in the expansion of the eth­ylene oxide plant in Antwerp, Belgium.

We are forecasting slight sales growth for the Materials segment. Given the continued volatile market environment, we anticipate higher prices driven by raw materials costs in the Monomers division. Slight volume growth overall will contribute to the sales increase. However, we are seeing diverging trends within the segment: The Performance Materials division will presumably record volume growth in all customer industries. By contrast, we anticipate slightly lower sales volumes in the Monomers division. We are forecasting a considerable decrease in the segment’s EBIT before special items due to earnings development in the Monomers division. The division’s EBIT before special items is expected to decline considerably as a result of lower margins, after strong margins in 2022. In the Performance Materials division, by contrast, we anticipate considerable growth in EBIT before special items due to the positive development of sales volumes amid stable margins.

Our planning for the Industrial Solutions segment assumes slightly lower sales in both divisions in 2023. The volume growth targeted for the Performance Chemicals division will only partially offset the effect on sales of the divestiture of the kaolin minerals business as of September 30, 2022, and expected price declines due to lower demand. The slight sales decrease in the Dispersions & Resins division will mainly reflect lower volumes on the back of softer demand. We are forecasting a slight decline in the segment’s EBIT before special items. This will primarily result from considerably lower EBIT before special items expected in the Dispersions & Resins division due to weaker margins. This will only be partially offset by considerable earnings growth in the Performance Chemicals division, mainly from higher volumes.

In the Surface Technologies segment, we are forecasting a slight sales decrease compared with 2022. This will primarily be driven by a significant decline in precious metal prices expected in the Catalysts division. Sales will be boosted by higher prices in the Coatings division and forecast volume growth in both divisions. The segment’s EBIT before special items is expected to decline slightly. We expect considerably higher EBIT before special items in the Coatings division as a result of higher margins and volumes. In the Catalysts division, by contrast, we anticipate a considerable decrease due to weaker margins caused by high raw materials prices and lower precious metal prices.

We expect sales in the Nutrition & Care segment to be at prior-year level. Prices are expected to be lower overall as a result of declining raw materials prices. This will be compensated by volume growth in both operating divisions due to improved product availability and an easing of global supply chains. The segment’s EBIT before special items should be slightly below the prior-year figure.

In the Agricultural Solutions segment, we expect slight sales growth in 2023. This will be mainly driven by higher prices while demand for agrochemicals and seeds will remain on a continuously high level. Based on the sales increase and a positive margin development, we are forecasting slightly higher EBIT before special items.

Sales in Other are expected to be slightly above the prior-year level in 2023. This should mainly result from higher sales from other activities, primarily driven by price increases. We anticipate a considerable decline in EBIT before special items compared with the previous year. This will largely reflect lower gains from hedging transactions, among other factors.