Annual Report 2023

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Creating tomorrow’s solutions

Executive Board Statement on Business Development and on the Group’s Economic Position

WACKER saw its year-over-year sales and earnings decline significantly in 2023 due to the ongoing weak market environment. This decline was prompted primarily by lower prices and volumes. There were hopes early in the year for a recovery in customer demand, but it did not materialize. And Germany’s persistently high energy prices further impacted our business. Sales declined in our chemical divisions as well as in the polysilicon business. Sales at WACKER BIOSOLUTIONS were on a par with the previous year.

EBITDA fell in every business division year over year. and was markedly lower year over year at WACKER SILICONES, WACKER BIOSOLUTIONS and WACKER POLYSILICON. But WACKER recorded decreases in polymer products, as well. Lower prices particularly for standard products, lower volumes of specialty products and reduced plant-utilization rates had a negative impact on EBITDA at WACKER SILICONES. At WACKER POLYMERS, the year-over-year decline was primarily due to significantly lower selling prices and volumes. By contrast, the fall in raw-material prices had a positive impact on EBITDA. The decrease at WACKER BIOSOLUTIONS was mainly attributable to integration and upfront costs at the León and Halle sites. At WACKER POLYSILICON, lower volumes and prices for solar-grade polysilicon – these declines being for production-related reasons – and persistently high energy prices in Germany had a negative impact. WACKER’s ROCE was down significantly year over year as well.

Personnel expenses declined year over year. Although WACKER was able to leverage efficiency gains to reduce the cost of goods sold, high energy costs, coupled with low plant-utilization rates as a result of the decline in sales volumes, reduced the gross margin considerably overall. The cost-of-sales ratio rose from 74 percent to 83 percent year over year. Depreciation and amortization remained on par with the previous year.

At €4.58 billion, Group equity was down slightly year over year, mainly due to the lower net income for the year. The equity ratio dropped from 53.5 percent to 51.7 percent. Net financial debt totaled €-83.7 million as of December 31, 2023. Capital expenditures increased significantly year over year and, at €709.6 million, were higher than depreciation/amortization. Net cash flow, at €165.6 million, was still firmly in positive territory, but less than the high figure of the previous year.

Even though the economic environment remains demanding in 2024, WACKER’s business prospects continue to be positive in the medium-to-long term.