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

The weak market environment meant that WACKER closed 2025 with sales and earnings below prior-year levels. The declines were mainly due to lower capacity-utilization rates in all divisions, lower volumes and prices in some cases, as well as negative currency effects.

EBITDA was significantly lower than the prior year. This decrease was due not only to lower volumes and prices, but also to lower plant-utilization rates. Energy costs in Germany remain uncompetitive by international standards, which had a negative impact too. In addition, earnings were negatively impacted by restructuring expenses of €102.6 million as part of the company’s ongoing PACE cost-saving project.

Sales and EBITDA in Silicones were down in the reporting period. EBITDA was impacted by negative volume/mix and currency effects as well as by low plant-utilization rates. Sales and EBITDA in Polymers were down year over year, too, mainly due to lower volumes, negative currency effects and lower sales prices. Biosolutions, too, fell short of the prior-year figures for both sales and EBITDA. Reasons for the decline included a reduction in biopharmaceutical customer offtake, and low plant-utilization rates. Sales and EBITDA declined in Polysilicon as well. Reasons for this decline included, in particular, lower solar-grade polysilicon volumes sold, currency effects as well as a very low plant-utilization rate. By contrast, the business with hyperpure semiconductor-grade polysilicon performed very well.

In the reporting year, ROCE was -3.1 percent (2024: 5.0 percent). The decline is due to lower EBIT combined with a slight increase in capital from €5.42 billion to €5.74 billion in the reporting year.

In 2025, a number of adjustments put pressure on the annual result, which came to €-804.9 million. In total, the adjustments that took effect at the end of 2025 came to approximately €600 million. Of this amount, €308 million is attributable to an adjustment relating to the shares in Siltronic AG, whose share price was consistently below the carrying amount. €195 million relates to deferred tax assets in Germany, which are no longer recoverable. €89 million results from the impairment of goodwill associated with the acquisition of ADL Biopharma.

Personnel expenses declined year over year. The cost of goods sold remained on par with the prior year. Despite the efficiency measures that were implemented, persistently high energy costs, coupled with low plant-utilization rates as a result of the decline in sales, had a negative impact on the gross margin, which declined. The gross margin was also hit by inventory-reduction measures. The Group’s cost-of-sales ratio rose accordingly to 88 percent (2024: 83 percent).

At €3.76 billion, Group equity was down considerably as against the previous year bringing the equity ratio to 44.9 percent. Net financial debt totaled €-885.7 million as of December 31, 2025. Capital expenditures were down considerably year over year to €465.9 million. Net cash flow in 2025 improved and was, at €-3.6 million, almost balanced (2024: €-326.0 million). The main reason for the improvement was the significant reduction in inventories.

Even though the economic environment remains demanding in 2026, WACKER’s business prospects are positive in the medium to long term.