July 23, 2020 / 9:07 AM / 19 days ago

Covestro says recovery continues in July thanks to polycarbonates

FILE PHOTO: The logo of German chemicals maker Covestro is pictured outside its headquarters in Leverkusen, Germany, July 26, 2019. REUTERS/Wolfgang Rattay

(Reuters) - German chemicals maker Covestro’s (1COV.DE) steady post-pandemic recovery has continued so far in July thanks to a strong performance of its polycarbonate division, the group’s finance chief said on Thursday.

The coronavirus crisis had hurt Covestro’s first-quarter numbers as key customers shut down factories, but demand picked up in June, allowing the company to beat consenus in preliminary second-quarter results released on July 9.

The recovery has carried through to July as declines in demand for polycarbonates from the automotive and transport industries were offset by a lower decline in volumes from the electrical, electronics, household appliances and construction industries, Chief Financial Officer Thomas Toepfer told Reuters.

Polycarbonates are a type of hard plastic that manufacturers use for car interiors, electronic equipment and toys.

The coronavirus pandemic had its strongest impact on Covestro in April and early May, when core volumes came in at 30% of the level the company was able to reach in June, Toepfer said.

Steady improvement in the company’s financial performance towards last year’s levels has been visible since mid-May, Toepfler said.

Covestro, whose main customers include the automotive industry and electronics manufacturers, reported final results broadly in line with the preliminary figures. It also confirmed the 2020 outlook it had announced in a profit warning on April 15.

Reporting by Anneli Palmer in Duesseldorf, writing by Zuzanna Szymanska in Gdansk; Editing by Tomasz Janowski

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