Brenntag (BNR) Q3 2024 earnings summary

Executive summary

• Q3 2024 sales reached EUR 4.1 billion, up 1% year-over-year, with operating gross profit up 3% to EUR 1.02 billion, but operating EBITA declined 5% to EUR 281 million and EPS dropped to EUR 0.82 from EUR 1.18.

• Free cash flow for Q3 was EUR 247 million, down 44% year-over-year, reflecting lower operating performance and higher investment outflows.

• The business environment remained highly competitive, with weak consumer confidence and ongoing geopolitical challenges.

• For the first nine months of 2024, sales declined 4.9% to EUR 12,247.7 million and operating EBITA fell 14.5% to EUR 837.9 million.

• Full-year 2024 operating EBITA guidance is confirmed at EUR 1.1–1.2 billion.

Financial highlights

• Operating gross profit margin expanded sequentially to 25% in Q3; for 9M 2024, operating gross profit was EUR 3,031.5 million, down 0.5% year-over-year on a constant currency basis.

• Operating EBITDA for Q3 2024 was EUR 370.8 million, down 2.7% year-over-year; operating EBITA margin fell to 27.6% from 30.3%.

• Net income for Q3 2024 was EUR 120 million, down from EUR 178 million in Q3 2023; EPS declined to EUR 0.82 from EUR 1.18.

• Special items negatively impacted results by EUR 58 million in Q3, including a EUR 42 million loss from the Raj Petro sale.

• Net finance costs rose to EUR 48 million due to higher net financial liabilities.

Outlook and guidance

• Full-year 2024 operating EBITA guidance is confirmed at EUR 1.1–1.2 billion, with expectations toward the lower end of the range.

• Challenging business environment and subdued demand are expected to persist, with continued pressure on industrial chemical prices.

• Cost-out program targets EUR 50–60 million in 2024, doubling in 2025, and reaching EUR 300 million annual savings by 2027.

• Tax rate guidance for 2024 is 26%–28%, expected to normalize around 28% in 2025; CAPEX planned at ~EUR 350 million.