Evonik Industries AG

Adjusted EBITDA was EUR 630 million in Q2 2026, up 24% year over year, driven by 7% contribution from higher volumes and 7% from higher prices. Management said Q2 was the best quarterly result in 4 years and noted the first-half adjusted EBITDA totaled EUR 1.1 billion. Free cash flow and cash generation improved significantly year over year, and the company reiterated full-year cash conversion guidance of around 40%. For the full year, management said it has raised the midpoint of the adjusted EBITDA outlook by EUR 250 million. On the call, management also said Q3 should be similar to Q2 with “maybe even a slightly more upside than downside,” but expects some normalization in Q4.

Christian Kullmann framed the quarter as evidence that Evonik is executing on structural change, not just benefiting from a strong cycle. He emphasized cost reduction, portfolio optimization, innovation reorganization and tighter cash discipline, while saying the company has “more potential” and is actively trying to realize it. On tone, he was upbeat about the quarter and methionine, but also cautious about the second half because visibility remains subdued and Q4 should normalize.

Michael Rauch highlighted that adjusted EBITDA rose to EUR 630 million, with higher volumes and prices each contributing 7%, and said Advanced Technologies, crosslinkers, polymers and C4 all helped. He said cash generation improved significantly, working capital was under control, and lower bonus payments plus advance customer payments and higher noncash provisions supported free cash flow. He reiterated around 40% cash conversion for the year and said the seasonal increase in net financial debt should be less pronounced than in prior years because of stronger cash and lower dividend payments. On capital allocation, he said there is still a sizable amount of net debt, so cash will first fund the business and a reasonable dividend, while buybacks are not currently on the agenda.

Analysts pressed hard on methionine, asking how long the price strength can last and whether 2027 could bring a sharp reversal. Management said methionine strength should continue into Q3, with pricing effects now coming through and a good amount of volume already booked; Christian Kullmann also said he expects a shakeout to start in 2027, which could affect markets next year. Questions on Custom Solutions focused on why guidance was only stable; Michael Rauch said additives are normalizing to pre-war levels, catalysts are broadly stable, and Care is pressured by weaker base-ingredient markets. The call also covered the new restructuring program, with management saying the split is likely to be about 60% administrative and 40% business-related roles, and that a EUR 50 million Witten site-closure adjustment was booked in Q2.