Covestro (1COV) Q3 2025 earnings summary

Executive summary

• Q3 2025 sales declined 12% year-over-year to €3.2 billion, mainly due to lower prices, adverse FX, and the Dormagen fire, with volumes down 1.5%.

• EBITDA reached €242 million, down 15.7% year-over-year but at the upper end of guidance, supported by cost savings.

• Net income dropped to €33 million, with EPS at €0.17.

• Strategic acquisitions included Pontacol AG and Vencorex sites in the U.S. and Thailand, expanding global production and specialty capabilities.

• The XRG transaction is progressing, with closing expected before December 2, 2025.

Financial highlights

• Q3 2025 sales: €3,171 million (-12.0% YoY); EBITDA: €242 million (-15.7% YoY); EBIT: €25 million (-67.1% YoY).

• Free operating cash flow for Q3 was €111 million; 9M 2025 FOCF at -€370 million due to lower EBITDA and higher CapEx.

• Net financial debt increased by €393 million to €3,011 million as of September 30, 2025; net debt/EBITDA ratio at 3.8x.

• Gross financial debt rose to €3,632 million, mainly from increased bank liabilities and commercial paper.

• Net income for Q3 2025 was €33 million; EPS at €0.17.

Outlook and guidance

• FY2025 EBITDA guidance narrowed to €700–800 million, reflecting Dormagen incident and market headwinds.

• Free operating cash flow guidance set between -€400 million and -€200 million.

• Sales for FY2025 estimated at €13.0–14.0 billion.

• ROCE above WACC projected at -9 to -8 percentage points.

• Gradual ramp-up of Dormagen production expected through 2026, with full TDI availability as chlorine supply improves.