29 June 2017
VIEW COVESTRO PRESENTATION JUNE 2017 PART 1
VIEW COVESTRO PRESENTATION JUNE 2017 PART 2
DETAILS
At its Capital Markets Day in London today,
Covestro underlines its commitment to further
creating value.
The Germany-based chemical company
has significantly outgrown its industry since its IPO in 2015,
recording core volumes expansion of 10.4%
between 2014 and 2016 and
higher free operating cash flow of +73% in the same period.
From 2017 onwards, Covestro expects to grow in line
with its industries that are forecasted
to grow above global GDP.
These prospects are expected to result in
continued strong cash generation:
the company anticipates generating
a cumulative free operating cash flow
of EUR 5 billion over the next five years.
On the use of this cash,
CEO and interim CFO
Patrick Thomas
“We see three basic ways:
firstly, we remain committed to
our attractive dividend policy of paying an increasing
or at least stable dividend.
Secondly, we look at bolt-on acquisitions
to boost our specialty businesses.
Lastly, we have no reason to hoard liquidity
if no significant external investment opportunity arises.
We intend to return excess cash to our shareholders
after 24 months without significant M&A activity.
This return could be done via
share buybacks or special dividends.”
In order to support its continued organic growth ambitions,
Covestro follows a smart capex approach
that is set to bring back capex spending
above depreciation and amortization in the mid-term,
from its current position.This includes a number of
* debottlenecking projects as well as
* brown-field investments.
Meanwhile, the company’s portfolio should be
increasingly geared towards differentiated products.
Already today,
more than 50% of sales and around 70% of earnings
are generated with resilient businesses,
based on FY 2016 numbers. Covestro is working on
further detaching its business from cyclicality,
partly through close collaborations
with customers and tailored innovations,
Dr. Markus Steilemann
Chief Commercial Officer and future CEO
“To outpace global growth
we need to innovate and work closely with our value chain
to anticipate and fulfill its needs.
We are well prepared to develop tailored solutions
and become even more customer-centric.
In addition we are continuously looking for new ways
to embed sustainability in our products and processes.”
Alternative resources
are one focus the company has in this regard.
* Biomass for coatings,
* CO2 instead of oil-based feedstock for polyols,
* and bio-based aniline
are three major milestones that Covestro achieved recently.
So the company is well positioned
to create value by supplying
innovative and leading material solutions
that help to solve the world’s challenges
– constantly pushing boundaries
to make the world a brighter place.
Covestro AG
Communications
51365 Leverkusen
Germany
Contact
Lars Boelke
Telephone +49 214 6009 4206
Email lars.boelke @covestro.com
Contact
Markus Kleine-Beck
Telephone +49 214 6009 6697
Email markus.kleine-beck @covestro.com
WWW.CHEMWINFO.COM BY KHUN PHICHAI
