Solvay Raises Earnings Guidance as Second-Quarter Profits Jump

By Ed Frankl

Solvay SA on Thursday raised its full-year earnings outlook after higher prices and strong demand led to bumper second-quarter profits.

The Belgian chemicals company said it expects full-year earnings before interest, taxes, depreciation and amortization to grow 14%-18%, from mid-to-high-single-digit growth expected under previous guidance.

It also increased its 2022 free cash flow outlook to 750 million euros ($764.8 million) from EUR650 million previously.

Solvay said the updated guidance already takes into account "modest declines in demand consistent with the generally negative economic outlook," though it assumes no significant supply issues of natural gas.

Earlier in July, the Brussels-based company said it would raise its 2022 guidance for the second quarter in a row, after it said its second-quarter performance was boosted by higher volumes and pricing, helping to overcome cost inflation.

Solvay reported second-quarter net profit of EUR470 million, well up from EUR276 million in the same period last year.

Sales rose 41.5% on a reported basis to EUR3.48 billion, driven by prices that were 26% higher and volumes that rose by 6%, it said.

The company's quarterly Ebitda was EUR864 million, up 43% from a year earlier, while its free cash flow was EUR257 million, Solvay said.

Write to Ed Frankl at [e-mail]

(END) Dow Jones Newswires

July 28, 2022 01:14 ET (05:14 GMT)

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