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Investing.com -- Shares of Solvay (EBR:SOLB) fell 2.4% today as the market reacted to the company’s fourth-quarter earnings report.
Despite the adjusted EBITDA for the quarter reaching €256 million, surpassing the Visible Alpha consensus of €241 million, investors appeared to focus on the softer performance in the Performance Chemicals segment and a conservative free cash flow guidance for the upcoming fiscal year.
The Belgian chemical company reported that its strong fourth-quarter earnings were primarily driven by a better-than-expected performance in its Basic Chemicals division. However, this was counterbalanced by weaker results in the Performance Chemicals division, leading to mixed sentiments among investors.
For the full year 2025, Solvay has guided an adjusted EBITDA of "€1.0-1.1 billion," which suggests a modest increase of around 1% compared to the current consensus of €1.04 billion. This forward-looking statement appears to have done little to sway investor confidence, as the guidance falls within a narrow range of the consensus.
Adding to the bearish sentiment, the company’s free cash flow (FCF) guidance for the fiscal year 2025 is projected to be around €300 million, which is significantly lower than the Visible Alpha consensus estimate of €387 million.
This conservative cash flow outlook may have raised concerns about the company’s ability to generate liquidity and fund its operations and investments.
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