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Investing.com -- Brenntag AG ’s (ETR:BNRGn) stock traded over 2% higher on Wednesday following its full-year 2024 earnings, which showed results broadly in line with expectations, despite a miss on earnings per share.
Analysts at Morgan Stanley (NYSE:MS) described the company’s operational performance as stable, with its guidance for 2025 aligning with consensus forecasts.
Brenntag reported full-year revenue of €16.24 billion, which met market expectations, while operating gross profit of €4.03 billion also landed in line with consensus estimates.
However, operating EBITA came in at €1.1 billion, about 1% below analyst projections, reaching the lower end of the company’s guided range of €1.1-1.2 billion.
The EBITA shortfall was attributed to a slightly weaker fourth quarter, in which operating EBITA stood at €268 million, falling short of the €277 million consensus.
Operating EBITDA totaled €1.46 billion, in line with estimates, while the dividend per share remained unchanged at €2.10, implying a payout ratio of 57%.
The company faced some financial headwinds, with net income declining year-over-year to €893 million due to higher special items, including losses on asset disposals and legal provisions. EPS also missed expectations, dropping 22% to €3.71, a roughly 6% shortfall compared to consensus estimates.
On a divisional level, the Specialties segment saw EBITA fall by 11.9% year-over-year, affected by elevated costs, while the Essentials division declined by 14.1%, weighed down by acquisition-related expenses, transportation costs, and DiDEX implementation costs.
However, volume trends in Essentials improved sequentially throughout 2024, leading to a stabilization of gross profit per tonne by the end of the year.
In Specialties, pricing remained strong, with some business units seeing double-digit growth in the fourth quarter, though volume momentum was slower.
Brenntag has set an operating EBITA guidance range of €1.1-1.3 billion, with the midpoint of €1.21 billion aligning with current market expectations.
The outlook assumes continued volume momentum, albeit at a slower pace than in 2024, alongside a second-half improvement in pricing.
The company also anticipates a modest foreign exchange tailwind of €20-30 million, based on an exchange rate of €/$1.05, and expects to include €30-40 million in contributions from mergers and acquisitions.