LEVERKUSEN, Germany—German materials supplier Covestro A.G. has reported an increase in both earnings and sales for the second quarter of 2017 thanks to increasing demand for polymer materials.
In the period ending June 30, group sales were up 17 percent at about $4.08 billion, while core volumes were down by 1.6 percent, the company said in its July 25 report.
Higher utilization rates and strong demand also helped the Leverkusen, Germany-based company to increase earnings (EBITDA) by 56.5 percent about $988 million in the second quarter.
Net income more than doubled with a 110.4 percent growth to about $563.9 million during the period.
For the first half of 2017, Covestro said sales increased 20.8 percent to $8.16 billion. Earnings increased 61.3 percent to about $1.98 billion.
CEO Patrick Thomas said the firm anticipates on generating a cumulative total of about $5.83 billion in operating cash flow, which will be used for bolt-on acquisitions in the specialties segment if an opportunity arises.
Chief Commercial Officer Markus Steilemann said Covestro would further invest in its production plants and remove bottlenecks in the polyurethanes and polycarbonates segments. Core volumes in the polyurethanes segment dropped 2.3 percent, but earnings in that segment increased by 143.9 percent to about $647.8 million.
The decline in volumes was attributable primarily to the polyether polyols product group and constrained product availability in the MDI and TDI product groups.
To meet the high demand Covestro said in March that it would continue production of the rigid foam precursor MDI in Tarragona, Spain, for the time being. The company also is doubling its MDI capacity at its Brunsbuettel plant in northern Germany to around 400,000 metric tons per year by the end of 2018.