Brenntag SE (BNTGF.PK), a leading German chemical producer, announced a decrease in third-quarter profit attributable to shareholders, reporting €118.2 million compared to €176.3 million during the same period last year. Earnings per share declined to €0.82 from €1.18, influenced by one-time effects primarily associated with the divestment of Raj Petro Specialties in India.
Operating EBITA experienced a 7.1% decline to €281.1 million, while the operating EBITA margin decreased to 27.6% from the previous year's 30.3%. The company implemented various pricing initiatives and cost containment strategies, yet these measures were insufficient to counterbalance the rise in volume-related expenses and inflationary pressures.
Despite the overall challenging business climate, operating gross profit increased by 1.9% to €1.02 billion, supported by pricing strategies in both divisions. Quarterly sales saw a slight decline of 0.5%, totaling €4.069 billion compared to €4.088 billion the previous year. In constant currency terms, sales reflected a minor increase of 0.7%.
Looking forward to fiscal 2024, Brenntag maintains its expectation for operating EBITA to be between €1.10 billion and €1.20 billion. This forecast takes into account the company's successful cost-reduction efforts and a positive start to the fourth quarter, despite the anticipation of persistent geopolitical, macroeconomic, and operational challenges throughout the remainder of 2024.
For 2024, the firm is targeting savings between €50 million and €60 million, with plans to approximately double these savings by 2025. Moreover, the company has articulated a clear strategy to achieve an annual cost reduction of €300 million by 2027.
