The following forecast for the 2025 fiscal year is based on the business development described in this Annual Report and takes into account the potential opportunities and risks.
In view of the continuing challenging economic conditions, the Board of Management of Covestro AG expects the key management indicators to change as presented below.
| Forecast for key management indicators | ||
|---|---|---|
| 2024 | Forecast 2025 | |
| EBITDA1 | €1,071 million | Between €1,000 million and €1,600 million |
| Free operating cash flow2 | €89 million | Between 0 million and €300 million |
| ROCE above WACC3, 4 | –7% points | Between –6% points and –2% points |
| Greenhouse gas emissions5 (CO2 equivalents) |
4.9 million metric tons | Between 4.2 million metric tons and 4.8 million metric tons |
1 EBITDA: EBIT plus depreciation, amortization, and impairment losses; less impairment loss reversals on intangible assets and property, plant and equipment.
2 Free operating cash flow (FOCF): cash flows from operating activities less cash outflows for additions to property, plant, equipment and intangible assets.
3 ROCE: ratio of EBIT after imputed income taxes to capital employed. Imputed income taxes are calculated by multiplying an imputed tax rate of 25% by EBIT.
4 WACC: weighted average cost of capital reflecting the expected return on the company’s equity and debt capital. A figure of 7.3% has been taken into account for the year 2025 (2024: 8.1%).
5 Greenhouse gas (GHG) emissions (Scope 1 and Scope 2, GHG Protocol) of all Covestro’s environmentally relevant sites. Until the year 2024, the GHG emissions at main production sites (responsible for more than 95% of our energy usage) were projected.
For the Covestro Group’s EBITDA, we project a figure between €1,000 million and €1,600 million. Covestro anticipates that the Performance Materials segment’s EBITDA will be €400 million to €800 million. In the Solutions & Specialties segment, we expect EBITDA to be sligthly higher than the amount of the year 2024 (€740 million).
The Covestro Group’s FOCF is forecast between €0 million and €300 million.
ROCE above WACC is anticipated in a range between –6% points and –2% points.
The GHG emissions of all the Covestro Group’s environmentally relevant sites, measured as CO2 equivalents, are projected to be between 4.2 million metric tons and 4.8 million metric tons.
The earnings of Covestro AG, as the parent company of the Covestro Group, largely comprise the earnings of that company’s subsidiaries. As a result of the profit and loss transfer agreement with Covestro Deutschland AG, net income of Covestro AG is particularly impacted by that company’s income from equity investments in Germany and abroad. Since we anticipate that income from investments in affiliated companies will be substantially up on the year 2025 compared with the previous year, we assume that Covestro AG will generate significantly higher net income (previous year: net loss) than in fiscal 2024.