Strategy of the WACKER Group
WACKER’s five overarching strategic goals have not changed. The focus is on profitable growth and on holding a leading competitive position in most of our business fields. In achieving this, we orientate our activities toward sustainable development.
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WACKER’s ongoing strategic business goals are to:
- Expand our production capacities, with capital expenditures below depreciation/amortization
- Generate higher growth than the average rate for the chemical industry
- Focus strongly on sustainability
- Achieve attractive margins throughout the economic cycle
- Increase our cash inflow from operating activities
Investment spending is focused on region-specific plants for intermediate and downstream production. They have a lower capital intensity than full-scale plants for upstream products.
We want to grow faster than the chemical-sector average by deploying new capacities, by expanding in emerging markets and regions, by innovating, and by substituting competitors’ products with WACKER products. In doing so, we intend to increase the proportion of specialty products in our portfolio. Our focal regions and countries for further growth remain unchanged: China, Southeast Asia, India, the Middle East and Brazil. We also see opportunities to expand our chemical business in our established markets in Europe and the USA.
Our Wacker Operating System (WOS) is focused on curbing raw-material consumption and raising process efficiency at our plants, the goal being to further lower specific operating costs. Additionally, we are developing a wide range of new, sustainable products to lower CO2 emissions. For example, we supply polysilicon as a starting material for solar installations and for diverse products used in today’s resource-saving construction sector.
Our aim is to achieve attractive margins with our products, with a target EBITDA margin for the chemicals divisions of >16 percent.
To finance investments ourselves, we aim to generate positive cash flow and steadily increase cash inflows from operating activities.
The aim of our Shape the Future program, launched in late 2019, is to cut costs and enhance efficiency. Our business divisions and corporate departments are reorganizing themselves and, in the process, streamlining their workflows and structures. At the same time, we are strengthening the responsibility of our regional entities. By the end of 2022, WACKER intends to save a total of €250 million. This includes cutting more than 1,000 jobs, mainly in Germany.
Digitalization is another topic affecting all our business processes. In 2017, we launched a digitalization program encompassing all core business processes – from logistics, production control and maintenance through to our distribution systems and new business models. Since December 2019, the program’s individual projects have been making progress in the corporate sectors responsible.