| Covestro AG income statement according to the German Commercial Code | ||
|---|---|---|
| 2024 | 2025 | |
| € million | € million | |
| Income from investments in affiliated companies – net | (28) | (98) |
| Interest expense – net | 108 | 48 |
| Other financial income – net | (5) | (5) |
| Net sales | 22 | 81 |
| Cost of services provided | (22) | (80) |
| General administration expenses | (103) | (68) |
| Other operating income | 2 | 2 |
| Other operating expenses | (1) | (1) |
| Income before income taxes | (27) | (121) |
| Income taxes | (28) | (16) |
| Net loss | (55) | (137) |
| Retained earnings brought forward from prior year | (124) | (179) |
| Withdrawal from other retained earnings | – | – |
| Net accumulated losses | (179) | (316) |
In fiscal 2025, Covestro AG generated a net loss of €137 million (previous year: €55 million). The change compared with the prior year was largely attributable to the net loss from investments in affiliated companies of €98 million (previous year: €28 million). The net loss from investments included the loss of €149 million absorbed under the control and profit and loss transfer agreement with Covestro Deutschland AG, which was partially offset by gains of €51 million from the control and profit and loss transfer agreement with Covestro First Real Estate GmbH.
In addition to interest expense of €35 million (previous year: €41 million) for the euro bonds issued, the interest result included mainly interest income of €111 million (previous year: €178 million) on loans extended to Covestro Deutschland AG. Interest expense of €29 million (previous year: €28 million) was incurred in the reporting year on external loans from third parties.
Other financial income and expenses mainly comprised bank fees totaling €5 million (previous year: €5 million). These included fees for providing the company lines of credit and the prorated reversal of the discount on the bonds issued.
Sales from services amounted to €81 million (previous year: €22 million) and resulted from services provided by the corporate center areas of Covestro AG to Covestro Group companies. The expenses incurred for the provision of the services by the corporate center areas were reported under cost of goods sold. The rise in sales was mainly attributable to intragroup transfers of costs amounting to €52 million incurred as part of the global STRONG transformation program. The associated expenses were recognized in cost of goods sold.
General administration expenses totaling €68 million (previous year: €103 million) mainly consisted of personnel expenses for the employees of the Group holding company and members of the Board of Management. General administration expenses went down in fiscal 2025, primarily due to lower expenses for consultancy services. There was also a reduction in expenses for variable compensation.
The result of operations was €–121 million (previous year: €–27 million) and led to income taxes of €16 million (previous year: €28 million). This resulted in a net loss for the year of €137 million (previous year: €55 million), which also represents the net accumulated losses for the reporting year. This amount is carried forward to new account.
Based on the forecast from the Annual Report 2024, net income for fiscal 2025 was expected to be significantly higher than the figure recorded in the previous year. However, with a net loss of €137 million for fiscal 2025, the result was significantly down on the prior-year figure. This was attributable to both a decline in the result from investments in affiliated companies and higher net interest expense. This decline arose in particular from expenses under the control and profit and loss transfer agreement entered into with Covestro Deutschland AG.