Tag Archives: COVID-19

Brenntag raises Operating EBITDA Forecast for FY 2021

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Continued positive Earnings Trend and good Prospects for the Rest of the Year are encouraging to German Distribution Group

Global chemical distributor Brenntag SE (Essen, Germany) last week decided to raise the forecast for operating EBITDA for the 2021 financial year previously published on 10. March 2021. Against a backdrop of strong results Q1-2021 and “the continuation of the postive earnings trend into the second quarter to date, as well as considering the prospects for the rest of the year, Brenntag said it expects an Operating EBITDA in the range of EUR 1’160 mn to EUR 1’260
mn for the financial year 2021 (previously: EUR 1’080 mn to EUR 1’180 mn).

Taking into account organic growth, the expected efficiency gains from the implementation of the transformation program “Project Brenntag” and the contribution to earnings from acquisitions which have already been closed, the new forecast is also based on the assumption that exchange rates will remain stable on the level of the announcement date. The forecast does not envisage any special items and comes with the usual caveat that it is “dependent on any further impact of the COVID-19 pandemic on both the macroeconomic environment and the Group not deviating significantly from the currently known extent.”

Source: Brenntag press release

HGE – DCG / 21.06.2021

Brenntag reports strong Q1-2021 Results despite challenging Market Conditions

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Good Start for recently established global Divisions of leading Distribution Group

Global chemical distributor Brenntag SE (Essen, Germany) has published the Q1-2021 results yesterday. Despite a marginal decline in sales to EUR 3’132.5 mn (down 2.5% from EUR 3’211.3 mn as reported, or +2.7% on a constant currency basis), the group is showing increases in Operating Gross Profit of 1.8% (7.4% on  a constant currency basis) from EUR 750.7 mn in Q1-2020 to EUR 764.5 mn last quarter and Operating EBITDA of 14.2% (20.7% on a constant currency basis) from EUR 263.0 mn in Q1 of the previous year to EUR 300.3 mn.

 

Profit before tax was down 10.8% at EUR 139.3 mn, Profit after tax down  12.9% at EUR 100.2 mn. This results in earnings per share attributable to Brenntag shareholders of EUR 0.63 per share (down from EUR 0.74 per share in Q1-2020). The reduction was mostly caused a “non-recurring, extraordinary increase in provisions related to a tax audit concerning past handling of alcohol taxes”, Brenntag said in the announcement.

 

Working capital increased by 14.8% to EUR 1’545.8 mn (up from EUR 1’346.6 mn at the end of  2020) mostly driven by an increase in Trade Receivables. At a level of EUR 75.6 mn, free cash flow was down significantly from the EUR 161.5 mn realised in Q1-2020.

 

With this quaterly set of data Brenntag for the first time provided feedback on the performance of the new global divisions, Brenntag Essentials and Brenntag Specialties that represent the the destinct market aproach the company switched to effective 01. January 2021.

 

Brenntag Essentials had what the announcement described as “outstanding results”, with an Operating Gross Profit of EUR 472.5 mn, up 1.4% as reported or +7.1% at a constant currency basis. This resulted in an Operating EBITDA of EUR 194.1 mn (representing 64.4% of the total in Q1-2021), up 22.6% as reported or +29.2% on a constant currency basis. Brenntag said that “all regions contributed to the positive performance … , with North and Latin America as well as Asia Pacific being particularly strong. EMEA showed slightly weaker growth rates compared to the very strong development of the recent quarters.”

 

Brenntag Specialties, which is focusing on six selected customer industries: Nutrition, Pharma, Personal Care / HI&I (Home, Industrial & Institutional), Material Science (Coatings & Constructions, Polymers, Rubber), Water Treatment and Lubricants, had an Operating Gross Profit of EUR 284.3 mn, up 1.7% as reported and +7.1% and a constant currency basis, resulting in a reported Operating EBITDA of 119.8 million EUR (+3.5% or + 9.2% on a constant currency basis. Here the regions EMEA and Asia Pacific showed a particularly strong performance across all industries, Brenntag said.

 

With the split into two global divisons, the implementation of Project Brenntag has made good progress so far, the statement said. Designed to be a comprehensive transformation program, it has the main objectives to “expand Brenntag’s position as global market leader and position the company for sustainable organic earnings growth.” Step-by-step implementation of the program’s initiatives is underway and more than 50 of the around 100 site closures have already been completed to date. Since the initiation of the program, around 350 jobs have been reduced, out of approx. 1’300 planned over two years. Brenntag said it is using natural fluctuation, mutually agreed separations, and regular and early retirement schemes in order to realise the adjustments in a socially responsible manner.

 

Brenntag also said that the actions regarding crisis management remain in place as have proven to be effective. The company has successfully limited the impacts of the pandemic on its business and protected the health and safety of its employees and business partners.

 

Against the backdrop of a continued challenging environment and the results of Q1, Brenntag said it confirms its Operating EBITDA guidance to be in the range of EUR 1’080 to 1’180 mn for the full year, with both global division expected to contribute.

 

Source: Brenntag press release and quarterly report; DistriConsult analysis

 

HGE – DCG / 12.05.2021

Brenntag reports Results for an “extraordinary” Year 2020

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Operating EBITDA for the Group grows, despite Decline in Sales, particularly in North America

Global chemical distributor Brenntag AG (Essen, Germany) has published the annual results for 2020 today. Sales declined, but Operating Gross Profit for the group and in most geographic regions increased, except for North America. Earning per share remained constant at EUR 3.02 per share.  Brenntag is planning for an 8.0% increase of the dividend to EUR 1.35 per share. This is equivalent to a payout ratio of 44.7% of the Profit after Tax attributable to Brenntag’s shareholders. The dividend payment is subject to approval by the AGM in June.

Brenntag’s sales in 2020 were EUR 11’775.8 mn globally , -8.2% as reported and -6.0% on a constant currency basis, when compared with last year. (Operating) Gross Profit was EUR 2’850.4 mn, an increase of 1.0% as reported, and +3.3% on a constant currency basis. Overall, the group reported an Operating EBITDA of EUR 1’057.5 mn,  up 5.6% from the EUR 1’001.5 mn in 2019 as reported (an increase of 8.3 % on a constant currency basis). Both, Profit before Tax at EUR 663.3mn (EUR 633.4% in 2019) and Profit after Tax at EUR 473.8 mn (EUR 469.2 mn in 2019), remained virtually flat. This results in Earnings per Share attributable to Brenntag shareholders of EUR 3.02 per share, the same level as reached in 2019.

Net Working Capital decreased significantly from EUR 1’767.7 mn at the end of 2019 to EUR 1’346.6 mn at the end of last year. Based on this development, working capital turns improved from 7.0x to 7.3x during 2020. At a level of EUR 1’054.6 mn in 2020, free cash flow was up 26.0% from the EUR 837.3 mn realised in 2019, mostly driven by the reduction in Net Working Capital, Brenntag said.

Sales were impacted by a very challenging macro-economic environment and extraordinary economic conditions triggered by the COVID-19 pandemic. Brenntag said it went into “crisis management mode” early on in the pandemic and managed to maintain uninterrupted supply chains throughout 2020.

In EMEA sales declined by 4.0% (-2.7% on a constant currency basis) to EUR 5’027.5 mn. On the Operating EBITDA level, the EMEA region increased significantly by 17.1% as reported to EUR 475.9 mn (+19.0% on a constant currency basis). Well performing sectors were Personal Care, Cleaning, Pharma and Coatings & Construction, Brenntag said. 

North America suffered from soft demand, particularly in Oil & Gas and Lubricants, with sales declining by 12.5% (10.6% on a constant currency basis) to EUR 4’191.0. The region reported also a decrease of Operating EBITDA, -8.5% to EUR 434.4 mn (-6.6 % on a constant currency basis).

Latin America reached an Operating EBITDA of EUR 63.5 mn, up 13.5% as reported from EUR 55.9 mn (+26.9.0% on a constant currency basis), despite  declining sales at EUR 819.4 mn, down 4.1% as reported (+6.0% on a constant currency basis). 

Asia Pacific contributed an increased Operating EBITDA of EUR 123.8 mn, up 22.5% from the EUR 101.1 mn reported for 2019 (+25.9 % on a constant currency basis. Brenntag said that “after being hit by the pandemic early in the year, the Asia Pacific region recovered sequentially, with particularly China seeing a quick and strong recovery. Almost all countries and many industries contributed to the very good results.” 

As part of the comprehensive transformation program dubbed “Project Brenntag”, which was launched by CEO Christain Kohlpaintner in mid-2020, the company has started to follow a new operating model based on two global divisions named Brenntag Essentials and Brenntag Specialties. Amongst other things, the project comprises programs for the site network optimisation (a reduction of the number of sites globally by 100, of which 30 were closed already in 2020) and a workforce reduction initiative (headcount reduction in 2020 was ca. 200 FTEs).  These, as well as other efficiency measures, are expected to generate a total increase of EUR 220 mn in Operating EBITDA by FY2023, ramping up year by year. In 2020 the initial contribution was approx. EUR 15 mn. 

Providing an outlook for 2021, Brenntag said it expects an Operating EBITDA for the current year between EUR 1’080 and 1’180 mn, assuming  that exchange rates remain stable. The group sees itself operating in a macroeconomic environment of considerable uncertainty, particularly in the first half of the year. The outlook also includes expected efficiency gains from the restructuring measures being currently implemented as part of Project Brenntag and full-year contributions from several acquistions closed during 2020, the announcement said. 

Additional details can be obtained via the links below:

https://www.brenntag.com/corporate/en/media/news/brenntag-shows-strong-performance-in-the-extraordinary-year-2020-that-underlines-the-resilience-of-its-business-model.html

https://www.brenntag.com/corporate/documents/investor-relations/2021/gb-ar2021/brenntag_annualreport_2020.pdf

Source: Brenntag press release, earnings call and annual report; DistriConsult analysis

HGE – DCG / 10.03.2021

Fecc postpones 2021 Congress by a Year

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Series of virtual Meetings planned for original Congress Date 20. May 2021

According to a note on its website, Fecc, the European Association of Chemical Distributors (Brussels, Belgim) has announced that “after careful consideration of the current COVID-19 situation and the uncertainties that remain for the coming months, the Fecc Board has made the decision to postpone our annual event to 2022”. The exact date is still to be confirmed.

 

Fecc Director General Dorothée Arns and her staff are working on a series of virtual meetings to be held on the originally scheduled main congress day 20. May 2021, which will include accompanying sessions for the Assembly of National Associations, Company Members and the General Assembly Plenary. In the announcement Fecc said, the plans is also to “invite inspirational speakers who will give talks on the state of the world and of distribution.”

 

Source: Fecc website

 

HGE – DCG / 05.02.2021

 

 

Brenntag releases new Forecast for FY2020

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Operating EBITDA expected to be comparable with FY2019 or marginally higher

Following yesterdays meeting of its Board of Management, global chemical distributor Brenntag AG (Essen, Germany) has published a new forecast for 2020. Due to the uncertainty associated with the COVID-19 pandemic,  the original forecast published in the 2019 annual report was suspended in April.

Brenntag says it has achieved “sound earnings growth in the first half of 2020”, despite the adverse impact of the COVID-19 pandemic on general economic performance,  a result it attributes to “the resilience of its business model”.

With current business performance in line with the Board of Management’s expectations and an operating EBITDA in July and August 2020 slightly above the prior-year figure on a constant currency basis, Brenntag now expects operating EBITDA for FY2020 to reach a level of EUR 1’000 mn and EUR 1’040 mn. This compares to EUR 1’001.5 mn reached in 2019.

 

Brenntag said its new forecast is based on the assumption “that there will be no further significant government measures to contain the pandemic and related negative effects on the economy”. “[The] forecast does not envisage any special items or significant changes in current exchange rates in the further course of the year. It includes the contributions to earnings from acquisitions” the statement said.

The interim report for the results of Q3-2020 is scheduled to be published on 04. November 2020.

 

Source: Brenntag press release

 

HGE – DCG / 16.09.2020

Hawkins, Inc. reports Fourth Quarter and FY2020 Results

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Hawkins with lower Sales but higher Adjusted EBITDA

United States chemical distributor Hawkins, Inc. (Roseville (Minneapolis), MN, United States) yesterday published results for Q4-FY2020 and Fiscal 2020. Sales for the three months ended on 31.3.2020 were USD 132.4 mn, virtaully flat when compared wth the same period in fiscal 2019 at USD 133.1. Adjusted EBITDA was USD 13.1 mn, an increase of 10.3% compared to the USD 11.9 mn realised in Q4-FY2019.

 

Sales for the full fiscal year 2020 were 540.2 mn, a decline of 2.9% when compared with the USD 556.3 mn realised in FY2019. Hawkins said the The decrease in sales was driven primarily by lower pricing due to lower costs of one of the major commodities, offset by increased volumes sold of certain manufactured, blended and re-packaged products. Sales in the Industrial segment were USD 275.2 mn, down USD 6.7 mn or 2.4%. Sales in Water Treatment increased USD 10.4 mn or 7% to USD 159.9 mn. Sales in Health and Nutrition decreased by USD 19.9 mn or 15.9% to USD 105.1mn

 

Gross Profit in FY2020 was USD 100.9 mn (equivalent to 18.7% of sales), an increase of USD 5.0 mn over the USD 95.9 mn or 17.2% of sales in FY2019. Adjusted EBITDA was USD 65.3 mn (12.9% of sales), which compares with USD 60.7 mn or 9.8% of sales achieved in FY2019.

 

Net Income was USD 28.4 mn or USD 2.66 per diluted share. This compares with a figures of USD 24.4 mn and USD 2.29 for fiscal 2019, respectively. 

 

Hawkins said it has used USD 25 mn from the record operating cash flow of USD 58.9 mn for the full year to pay down debt. The company now has a debt level of USD 55.7 mn, resulting in a leverage ration below 1.0x.

 

Regarding COVID-19, the company notes that the “pandemic has created tremendous uncertainty in the economy. The financial impact … has been mixed, as sales to certain end-markets such as Food, Bottled Bleach and Health & Nutrition have benefited [certain] reporting segments, while decreased sales to other end-markets such as Ethanol, Pools & Resorts have negatively impacted them. As uncertainty continues with this pandemic, the company expects mixed results to continue for the foreseeable future.”

 

Source: Hawkins press releases

 

HGE – DCG / 21.05.2020

DKSH elects Marco Gadola as new Chairman at Ordinary General Meeting

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Shareholders vote by Proxy at re-schedulded OGM and approve Dividend Payment

Market expansion services provider (and speciality chemicals  and ingredients distributor) DKSH AG (Zurich, Switzerland)  yesterday held its Ordinary General Meeting. Shareholders approved all motions by a large majority, including distribution of a dividend of CHF 1.90 per share and the election of Marco Gadola as Chairman of the Board of Directors. Due to the restrictions triggered by the COVID-19 pandemic, the shareholders could only vote by independent proxy. DKSH said 84.2 percent of the total share capital were represented that way.  The meeting had been re-scheduled from its earlier, original date in mid-March due to restrictions imposed by the Swiss Federal Government at the time.

The company also said it had recorded “solid results in the first four months of 2020 due to its resilient business model”, but did not elaborate on details. As it was not possible to assess the potential impact of COVID-19 on the busines, the full-year 2020 outlook was withdrawn.  DKSH plans to report its half-year results on 15. July and will hold a Capital Markets on 21. September. 

Source: DKSH press release

HGE / DCG – 14.05.2020

Univar Solutions reports Q1-2020 Results

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U.S. based Distributor shows Growth in all Regions except EMEA and is pleased with its Performance

Global chemical distributor Univar Inc. (Downers Grove, IL – United States) yesterday reported the financial results for the first quarter 2020. Consolidated net sales were USD 2’211.2 mn, up 2.4%  (+3.6% at constant currency) compared with USD 2’160.0 mn in Q1-2019.  Growth in the USA of 3.8%, Canada of 4.4% and particularly in LATAM (= Latin America) of 12.9%, was partially offset by declining sales in the EMEA (=Europe, Middle East & Africa) region (-4.8%). Univar attributes the growth in sales partially to the effects of the Nexeo acquition, but also to a higher demand for products in what the group calls “essential end markets” (= “products and services that are esssential for maintaining clean drinking water, waster water treatment, home, industrial and health care facility sanitization, and that are used in the manufacturing of food and pharmaceuticals”).  

Adjusted EBITDA came in at  USD 161.6 mn, up 0.9% (+2.6% at constant currency) from the USD 160.1 mn realised in the first quarter of last year. EBITDA growth was particularly strong in LATAM at +45.6%, followed by the Canada at +25.8. Int he USA profit was essentially flat at -0.5% while EMEA showed a decline at -4.3%.

Overall this resulted in net earnings of USD 55.9 mn or earning per diluted share of USD 0.33, which compares with net loss of USD 63.9 mn and earnings per diluted share of USD -0.43 in Q1-2019, respectively. Adjusted net income was USD 52.3 mn, compared to USD 49.7 mn in Q1-2019  and adjusted earnings per diluted share decreased slightly to USD 0.31 in the quarter from USD 0.33 in the first quarter of the prior year.

The Leverage Ratio increased to 3.7x at the end of March 2020, up from 3.3x at the end of December 2019, but lower that the 3.9x posted on 31. March 2019. Drivers were a sesonal increase in working capital, partially offset by “working capital efficiency”, Univar Solutions said. Capital expenditure plans have been reduced, from a previously anticipated level of USD 120 to 130 mn to a range of USD 95 to 115 mn. Univar stated that is has sufficient liquidity of ca. USD 750 to 800 mn in cash and available lines of credit at the end of Q2-2020. This position is expected to increase by end of the year.  The company also stressed that it has no significant debt maturities until 2024 is in full compliance with its credit agreements. 

Univar has withdrawn its full year guidance for Adjusted EBITDA a few weeks ago. The company plans to provide an update “as appropriate”, once it has obtained greater clarity regarding the impalications of COVID-19 and the impact this pandemic will have on its future business. It is monitoring the situation and will take expense reduction measures beyond some already initiated, if needed. 

Fore further details see the following link:

https://investors.univarsolutions.com/investors/investor-news/investor-news-details/2020/Univar-Solutions-Reports-Solid-2020-First-Quarter-Financial-Results-Maintains-Strong-Balance-Sheet-and-Liquidity/default.aspx

Source: Univar press release

HGE – DCG / 12.05.2020

Brenntag reports solid Q1-2020 Results and makes Progress on Holistic Analysis of Business

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Operating Gross Profit and Operating EBITDA increase despite flat Sales

Global chemical distributor Brenntag AG (Essen, Germany) has published the Q1-2020 results, showing increases in Operating Gross Profit of 8.3% (7.1% on  a constant currency basis) from EUR 688.2 mn in Q1-2019 to EUR 745.2 mn and Operating EBITDA of 10.1% (8.7% on a constant currency basis) from EUR 238.8 mn in Q1 of the previous year to EUR 263.0 mn. Sales was “flat” at EUR 3’206.1 mn, +0.7% (-0.3% on a constant currency basis), not really different from the EUR 3’182.3 mn realised in Q1-2019. 

Profit before tax was up 8.9% at EUR 156.6 mn, Profit after tax up 9.3% at EUR 115.0 mn This results in earnings per share attributable to Brenntag shareholders of EUR 0.74 per share (up from 8.8% from EUR 0.68 per share). Working capital decreased slightly to EUR 1’752.8 mn (down from EUR 1’767.7 mn at the end of  2019). At a level of EUR 161.5 mn, free cash flow was down slightly from the EUR 166.3 mn realsied in Q1-2019.

In EMEA the company experienced a good quarter with increased demand, as most of the company’s customers were able to maintain business operations, despite COVID-19 related issues. Sales were up 3.3% as reported and on constant currency basis to EUR 1’391.9 mn. On the Operating EBITDA level, the EMEA region increased by 20.9% as reported to EUR 406.3 mn (+21.2% on a constant currency basis).

North America remained difficult territory for the company. The region even reported an decrease of the Operating EBITDA, -1.7% to EUR 110.1 mn (-4.6 % on a constant currency basis). Sales were down -2.5% (-5.2% on a constant currency basis) to 1’146.5 mn. Despite positive trends in some industry segement, Oil & Gas with it’s “clear declines in business” drove earnings down, the company said.

Latin America reached an Operating EBITDA of EUR 13.8 mn, up 20.0% as (+25.1% on a constant currency basis), despite  what Brenntag described as “a continued volatile and difficult market environment” in the region”. Sales in the region were EUR 217.1 mn, up 3.1% or 6.4% on a constant currency basis.

Asia Pacific contributed an Operating EBITDA of EUR 26.3 mn, up 22.3%  (+20.1 % on a constant currency basis) This increase is due in particular to the acquisition of Tee Hai Chem Pte. Ltd., closed during 2019, Brenntag said in the statement. 

As Brenntag said earlier in the year, it is currently examining its internal structures, processes and organisational forms along the value chain, where it sees potential for improvement in harmonisation and standardisation. This initiative, dubbed “Project Brenntag” is making good progress, the CEO later said in the earnings call.

Source: Brenntag press release, earnings call and quarterly report; DistriConsult analysis

HGE – DCG / 08.05.2020

Brenntag to switch to a “virtual” Format for General Meeting of Shareholders in June

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German Distributor keeps Date for General Meeting of Shareholders and confirms Payment of Dividend

Global chemical distributor Brenntag AG (Essen, Germany) announced  General Shareholders’ Meeting of Brenntag AG will take place as planned on 10. June 2020. However, due to the spread of COVID-19, this year’s meeting will be held as a purely virtual event, without the physical presence of shareholders, the company said.


Brenntag’s Board of Management and the Supervisory Board also confirm their intention to pay out the proposed dividend of 1.25 EUR per share for the financial year 2019 in full, subject to the approval of the shareholders.

 

Source: Brenntag press release

 

HGE – DCG / 30.04.2020

Univar Solutions to hold “virtual-only” Annual Meeting

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U.S. based Distributor keeps Date for upcoming Annual Meeting of Stockholders

Global chemicals and ingredients distributor Univar Solutions, Inc. (Downers Grove, IL – United States) announced on Monday that its upcoming 2020 Annual Meeting of Stockholders (“Annual Meeting”) will be held in a virtual only format on 07. May 2020, at 08:30 CDT. Univar said this decision has been made in light of public health concerns regarding the coronavirus (COVID-19) pandemic.

In a separate announcement Univar said the results for Q1-2020 will be reported on 11. May 2020.

 

Source: Univar press release(s)

HGE – DCG / 09.04.2020

IMCD brings Q1-2020 Update forward to mid-April and postpones AGM

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General Meeting of Shareholders planned for 07. May is being postponed

Specialty Chemicals distributor IMCD N.V. (Rotterdam, The Netherlands) today announced that the group will bring foward its Q1-2020 trading update by more than two weeks to 20. April 2020, publication will take place before market opening. There will be an analyst conference call with the CEO and the CFO later in the day.

 

The group will also postpone its General Meeting of Shareholders, which was originally scheduled for 07. May 2020, due to the developments triggered by the global COVID-19 pandemic. A new date will be announced at the time of the trading update, IMCD said.

 

IMCD also said it did not observe a material adverse impact on its first quarter results caused by COVID-19. With the situation developing rapidly, and the duration of the COVID-19 crisis being unpredictable, the company said “it is difficult to quantify the impact in the months to come. IMCD continues to monitor market conditions and the impact of COVID-19 on its business closely.”

 

Source: IMCD press release

 

HGE / DCG – 07.04.2020

 

 

Brenntag suspends 2020 Forecast for COVID-19 Reasons

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Business Performance in Q1-2020 not significantly impacted by the Pandemic

Global chemical distributor Brenntag AG (Essen, Germany) has taken the decision to suspend the forecast for financial year 2020 published in the 2019 annual report due to “the considerable uncertainty about the future effects of the COVID-19 pandemic on global economic performance.”

According to the announcement, “Brenntag’s business performance in the first quarter was not significantly impacted by the pandemic. With a few exceptions, the Brenntag sites are currently fully operational. At the present time, however, it is not possible to give a reliable estimate of Brenntag’s business performance over the further course of the year due to the current spread of the pandemic in Europe and North America in particular and the containment measures decided by governments. Since the report on expected developments was prepared at the beginning of March 2020, the uncertainty around the expected effects has increased considerably.
The forecast will be updated as soon as it appears that the pandemic has been contained and the effects on Brenntag’s further business performance in 2020 can be reliably determined.”

Brenntag stressed that the company “has taken extensive measures to protect employees and business processes. The Group has a robust, diversified business model, a high level of liquidity and access to extensive, contractually agreed credit facilities.”

Source: Brenntag press release

HGE – DCG / 07.04.2020