Brenntag announces PAT decline to €295 million in H1 2024

Brenntag Group sales for H1 2024 were €8,178.9 million, down 6.9% year-on-year and 6.6% at constant exchange rates. The decline was due to lower selling prices, which were not offset by higher volumes.

In H1 2024, Group operating profit was €2,012.3 million, down 2.6% year-on-year and 2.3% at constant exchange rates. Despite slightly higher volumes in the Brenntag Specialties division, overall operating profit fell slightly due to lower unit operating profit. A similar situation was seen in the Brenntag Essentials division. Despite strong volume growth in the division, unit operating profit fell significantly compared to a strong reference period.

The Brenntag Group's operating EBITDA for H1 2024 was €727.6 million, down 12.3% year-on-year and 11.9% at constant exchange rates. Depreciation of property, plant and equipment and right-of-use assets amounted to €170.8 million in the first half of 2024 (first half of 2023: €152.8 million). Acquisitions were the main driver of this growth. In addition, investments in logistics businesses in North America and EMEA led to organic growth.

In the first half of 2024, the Brenntag Group achieved operating EBITA of €556.8 million. As a result, Brenntag's profit was 17.8 percent lower than in the previous year, which, at constant exchange rates, meant a 17.3 percent decline in earnings.

The overall decline in both divisions was due to lower unit operating margins, higher costs and volume effects.

Expenses for strategic projects amounted to €22.5 million in the first half of 2024. These mainly include consulting fees and severance costs related to the planning of the legal and operational separation of the two divisions Brenntag Specialties and Brenntag Essentials, which will contribute to the achievement of the cost reduction targets.

In the first half of 2024, a further charge of €19.7 million was recognized for legal risks arising from the sales of talc and similar products in North America, due to a sharp increase in the number of lawsuits filed.

Profit after tax in the first half of 2024 was €295 million (first half of 2023: €406.2 million).