Press releases

The CIECH Group summed up the first quarter of 2020: increase in the margin in the soda segment, results due to the issues not related to operating activities

The CIECH Group generated solid results in the first quarter of 2020: the EBITDA margin (Z)[1] was maintained at 17%, and in the case of the basic soda segment, it increased to 23% despite the production stoppage in Romania and the weakening economic situation. The EBITDA (Z) result amounted to PLN 142.1 million, compared to PLN 159.6 million in 2019. In addition to lower revenues from the suspension of production in Romania, the EBITDA (Z) and net result was affected by issues not related to core operations, including negative valuation of financial instruments. The Group has taken a number of initiatives to secure liquidity and reduce operating costs in subsequent quarters.

  • The CIECH Group's consolidated revenue for the first quarter of 2020 amounted to PLN 854.4 million compared with PLN 953 million in the same period last year. The decrease was mainly due to the shutdown of the plant in Romania.
  • EBITDA (Z) amounted to PLN 142.1 million against PLN 159.6 million, and net profit was PLN 39.4 million against PLN 61.4 million. The results were affected by costs related to the shutdown of the production plant in Romania, higher coal prices under the new contract for supplies of this raw material, adjustment related to the hedge accounting (approx. PLN -8.8 million) and a provision for an incentive program for the Group's managers (PLN -3.9 million).
  • Margins in the core business segments increased on an annual basis and amounted to 23.2 percent for the soda segment, 9.7 percent for organic, and 15.9 percent for silicates and glass.
  • The impact of the COVID-19 pandemic in the first quarter was visible in the Group's smaller businesses: foam and silicate production. Other businesses in the period January-March operated without significant disruption.
  • The CIECH Group has taken many initiatives to secure its liquidity in the face of the economic slowdown caused by the pandemic and at the end of the first quarter it had funds of PLN 694 million. In the second quarter, further actions were launched to improve working capital management and further reduce fixed costs.
  • The net debt to EBITDA ratio remained at a safe level of 2.6 (calculated for the needs of credit covenants before IFRS 16 was introduced).

- In the demanding market environment, first quarter results are stable - operationally all segments recorded higher margins than a year ago. The result was largely influenced by issues not related to the core business. During the pandemic, the plants in Poland and Germany are running smoothly. We actively monitor the situation both among suppliers and our customers. Since February, we have been preparing our Group for a possible economic slowdown and taking initiatives aimed at increasing liquidity and reducing costs, as well as ensuring the safety of employees and maintaining the continuity of production – says Dawid Jakubowicz, President of the Management Board of CIECH SA.


In the main segment - soda, which accounts for nearly 70% of revenues and over 80% of EBITDA (Z) - the margin generated turned out to be higher than the year before and amounted to 23%. (increase by 2 p.p.). The factories in Poland and Germany worked smoothly, serving customers from various industries, mainly glass production, detergents or chemical industry. Both the plants in Poland and Germany had high efficiency in the first quarter and significantly reduced production stoppage.


In the salt sector, work was underway on the construction of a new salt production plant in Germany with an annual capacity of 450,000 tonnes. Analyses of the impact of the pandemic on the timing of the launch of the investment, which may be delayed due to the situation of subcontractors associated with the effects of the pandemic, are currently ongoing. The production plant operations may ultimately increase the Group's EBITDA result by approximately EUR 25 million per year.


In the organic area, AGRO's business generated significant annual growth, both on the revenue and EBITDA (Z) sides. This was the result of a change in trade policy, among other things. CIECH Sarzyna recorded an increase in the market share of plant protection products and cereal herbicides in Poland, which amounted to 4.3% and 5.6% respectively (against 2.3% and 2.1% last year) [2]. At the end of the first quarter, the impact of the pandemic became apparent in the Pianki business, where there was a temporary reduction in production. Separation of the Żywice business from the beginning of 2020 as a separate company enabled more effective management of the businesses operating in Nowa Sarzyna (CIECH Sarzyna, CIECH Żywice). Żywice business in the first quarter of 2020 achieved a much better EBITDA result compared to the previous year. This was mainly due to the intensive commercialization of more marginalized products, expanding cooperation with existing and new customers and more efficient supply and production chain management.


The reduction in customer demand for silicates, which resulted from the decline in the demand for precipitated silica from the industries, also resulted in reduced production at CIECH Vitrosilicon plants, while the good start of the year allowed for stable results on an annual basis for the entire segment of silicates and glass.


- Based on preliminary economic data from the second quarter, we see a slowdown in industrial production and economic activity, although it is still difficult to assess their impact on business in subsequent quarters. We see also a slowdown in economic activity in the sectors of our clients, including those served by the soda sector. Therefore, we continue our efforts to increase product and geographical diversification, increase the share of specialist products and actively monitor the situation on the markets in Poland and Europe in the dynamically changing economic environment. We also put emphasis on further cost reduction – says Dawid Jakubowicz.


The table below presents basic data on the CIECH Group's results for the first quarter of 2020.


[mln PLN]1Q20201Q2019Y/Y
EBITDA margin17.0%16.8%0.2 p.p.
EBITDA (Z)142.1159.6-11.0%
EBITDA margin (Z)16.6%16.7%-0.1 p.p.
Net result39.461.8-35.0%



Mirosław Kuk, CIECH Group Press Officer, tel. +48 723 66 86 86.


CIECH to międzynarodowa, rozwijająca się grupa chemiczna z silną pozycją na rynkach europejskich i globalnych oraz ze stabilnym inwestorem strategicznym (Kulczyk Investments). Firma eksportuje swoje produkty do ponad 100 krajów całego świata, sodę kalcynowaną, sodę oczyszczoną, sól, środki ochrony roślin, żywice epoksydowe i poliestrowe, pianki poliuretanowe oraz krzemiany i opakowania szklane. CIECH wytwarza produkty o najwyższej, światowej jakości, z których powstają artykuły niezbędne w codziennym życiu ludzi na całym świecie. Łączy przy tym nowoczesne podejście do biznesu z tradycją produkcji sięgającą 1882 roku. Od 2005 roku spółka notowana jest na Giełdzie Papierów Wartościowych w Warszawie oraz, od 2016 roku, na jednej z największych giełd w Europie - Börse Frankfurt. Więcej informacji znajduje się na stronie


[1] (Z) a normalized indicator, i.e., cleared of one-off events, representing the Group's ability to generate repeatable results from its core business.

[2] PAMS data for the first quarter of 2020.

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