By Matteo Castia
Solvay S.A. on Wednesday reported a fall in second-quarter net profit as the pandemic hurt demand in several sectors and said it expects a challenging third quarter before trading starts to improve in the fourth quarter.
The Belgian chemical company posted a net profit of 109.0 million euro ($127.7 million), compared with EUR318.0 million in the year-earlier period. A consensus estimate compiled on FactSet had expected the company to post a net profit of EUR42.2 million.
First-half net profit came in at EUR345.0 million, down from the EUR608.0 million reported the previous year.
Earnings before interest, taxes, depreciation and amortization--one of the company's preferred metrics which strips out exceptional and other one-off items--was EUR439.0 million for the second quarter, down from EUR624.0 million in the same period last year. Ebitda for the first half was EUR1.01 billion, down from EUR1.20 billion a year earlier.
The company said the pandemic has hurt demand in its aero, auto, oil and gas, and construction markets, while performance has been more resilient in healthcare, food, home, electronics and personal care sectors.
In June, Solvay warned that market headwinds increased significantly during the quarter. It said Wednesday that trading will start improving during the fourth quarter, after an expectedly challenging third quarter.
Still, the company said it expects to deliver EUR300.0 million of cost savings through the full year.
In May, Solvay said it expected a restructuring charge of EUR30 million during the second quarter.
Write to Matteo Castia at email@example.com