Solvay (SOLB) Q1 2025 earnings summary

Executive summary

• Q1 2025 net sales were €1,122 million, down 6–6.6% year-over-year, mainly due to lower soda ash volumes, while other businesses showed resilience.

• Underlying EBITDA was €250 million, down 5.7–6% year-over-year, with a stable margin of 22.3%, supported by a one-off €10 million gain from a patent dispute.

• Structural cost savings delivered €27 million in Q1, totaling €137 million since early 2024.

• Free cash flow to shareholders was €42 million, reflecting normal seasonality and €70 million in Capex.

• Safety initiatives continued, with no reportable high-severity injuries in Q1 and declining injury rates.

Financial highlights

• Net sales declined 6–6.6% year-over-year, primarily due to a 6.3% drop in volumes, partially offset by a 0.6% price increase.

• EBITDA margin improved slightly to 22.3% year-over-year.

• Capex for Q1 was €70 million, in line with the annual target of €300 million.

• Net financial debt increased to €1.7 billion, mainly due to dividends and new lease liabilities; leverage ratio at 1.7x.

• ROCE stood at 17.2%, down from 19.8% year-over-year.

Outlook and guidance

• 2025 underlying EBITDA guidance confirmed at €1.0–1.1 billion, with expectations for the lower half if current conditions persist.

• Free cash flow guidance for 2025 is €300 million, with most generation in H2 due to seasonality.

• Capex target for 2025 set at €300 million, focusing on essential and high-return projects.

• Cost savings target of €200 million by end-2025, with €90 million expected to contribute to 2025 EBITDA.

• Q2 2025 net sales expected stable sequentially, but EBITDA to decline due to absence of Q1 one-off gain and higher stranded costs.