Solvay, the Belgian chemical company, has announced that its third-quarter profit and sales have fallen, falling short of analysts' expectations. The company attributes this decline to weak demand, as well as decreasing volumes and prices.
Net profit for the quarter decreased to €220 million ($233.7 million), compared to €451 million in the previous year. Net sales also saw a significant decrease of 24% to €2.75 billion. These figures are lower than the market's forecast of €271 million in net profit and €3.03 billion in net revenue, according to the company-provided consensus.
Furthermore, earnings before interest and taxes (EBIT) for the quarter were reported at €365 million, marking a 31% decrease from the prior year. This result is also below analysts' expectations of €396 million.
Factors Affecting Performance
During the quarter, Solvay experienced a 15% decline in volumes, while prices dipped by 5%. The company had already anticipated this impact in the second quarter when it warned of weak demand affecting volumes.
The company plans to pay an interim gross dividend of €1.62 per share on January 17, 2024. This dividend represents 40% of the total dividend for the year 2023.
Outlook for the Future
Despite the challenging results for Q3, Solvay maintains its outlook for the remainder of the year. The company projects its earnings before interest, taxes, depreciation, and amortization (EBITDA) to be at the lower end of its expected range, which includes a decline of 5% to a growth of 2%.