Second-quarter 2025 results

In a second quarter marked by weak demand and macroeconomic and geopolitical uncertainties, Arkema delivered a resilient EBITDA margin at the good level of 15.2% and a solid cash generation.

Sales of €2.4 billion, down 2.3% year-on-year at constant exchange rates:
- Volumes slightly down 1.3% in a demand environment broadly disappointing in Europe and the United States, and positively oriented in Asia
- Weak demand in most end-markets, however growth in several attractive sectors such as sports, batteries, efficient buildings and 3D printing, benefiting from the Group's innovation focus
- Negative 2.5% price effect reflecting market conditions, the geographical mix and the evolution of certain raw materials
EBITDA down at €364 million (€451 million in Q2’24) and a solid EBITDA margin at 15.2% (17.8% in Q2’24):
- Good resilience of High Performance Polymers and Adhesive Solutions
- Significant decline in Coating Solutions and Intermediates
- Weakening of the US dollar and several other currencies against the euro
- Strengthening of cost saving initiatives
Adjusted net income of €118 million (€214 million in Q2’24), representing €1.56 per share (€2.87 in Q2'24)
Recurring cash flow of €111 million (€132 million in Q2’24), reflecting the strict management of working capital in response to market conditions
Net debt and hybrid bonds of €3,580 million at end-June 2025, including the dividend payment (€272 million) last May
Adjustment of the annual EBITDA guidance to take into account continuing weakness in demand, geopolitical uncertainties and the evolution of exchange rates. The Group expects to achieve EBITDA of between €1.3 billion and €1.4 billion in 2025. Recurring cash flow should adjust accordingly to between €300 million and €400 million. Cost-cutting efforts will be strongly reinforced, with Arkema doubling its target for fixed and variable cost savings to €100 million for the year.

Chairman and CEO Thierry Le Hénaff said:

"The macroeconomic environment remained difficult in the second quarter, marked notably by the wait-and-see attitude of customers in response to tariffs and by the unfavorable evolution of exchange rates. Arkema's teams continue to adapt with agility and commitment, as they have done in the past in similar contexts, and to work simultaneously across both short- and long-term time horizons.

In the short term, cost and cash management actions are being significantly strengthened. Furthermore, operating with a long-term perspective, the Group is pursuing its strategy of development centered on innovative materials with the execution of its major projects and its innovation dynamic focused on its large growth platforms such as batteries, sustainable consumer goods or efficient buildings.

The ramp-up of our bio-based polyamide plant and the announcement of a new Rilsan^® Clear transparent polyamide unit on our Singapore platform, where we gathered a large number of clients and the local authorities in mid-July, as well as the start-up of our additives plant for refining and biofuels in Texas are all assets which are serving this strategy.”

Outlook

The start of the second half of the year follows the trend of recent months, within a macroeconomic environment marked by continuing weakness in demand, geopolitical uncertainties and unfavorable evolution of exchange rates relative to the euro. In this context, Arkema is focusing as a priority on the elements that are within its control, and is significantly strengthening its cost-cutting initiatives, aiming to achieve €100 million of fixed and variable cost savings over the year, i.e., double the original target. Cash will continue to receive a particular attention, notably through strict management of working capital and capital expenditures.

The Group will also rely on the ramp-up of its major projects in high value-added innovative applications and in fast growing regions. Their additional EBITDA contribution is now expected to reach around €50 million in 2025 compared to 2024, with the Group also reaffirming its target of over €400 million in 2028.

Furthermore, Arkema anticipates a limited direct impact from the increase in tariffs thanks to its industrial footprint close to customers in the three major regions of the world but will nevertheless remain vigilant about their indirect impact on the macroeconomic environment and the wait-and-see attitude of customers.

Based on these elements, the Group now expects to achieve EBITDA of between €1.3 billion and €1.4 billion in 2025, including an unfavorable impact linked to the evolution of exchange rates of around €50 million compared to last year. Recurring cash flow should adjust accordingly to between €300 million and €400 million.

Finally, beyond the short-term priorities, Arkema will also continue to implement its strategic roadmap, notably its innovation focus and the development of high-performance solutions for a less carbon-intensive and more sustainable world, in close partnership with its customers. Relying also on its balanced geographical footprint, the Group will thus reinforce its positioning and its resilience, while benefiting from numerous growth opportunities.

Further details concerning the Group's second quarter 2025 results are provided in the "Second quarter 2025 results and outlook" presentation and the "Factsheet", both available on Arkema's website at: www.arkema.com/global/en/investor-relations/