Wacker Chemie (ETR:WCH) reported higher second-quarter sales and operating earnings as its cost-reduction program, pricing actions and improved operational performance offset subdued demand across several end markets.
Chief Executive Officer Christian Hartel said the company’s market environment remained difficult, citing uneven demand, geopolitical tensions and volatility in energy, raw-material and logistics costs. Still, group sales rose to €1.52 billion in the second quarter from €1.41 billion a year earlier.
“This was not a result of a broad market recovery,” Hartel said. “It was a result of actions within our control.”
PACE Program Drives Savings
Management attributed much of the earnings improvement to PACE, its cost-savings program, alongside higher volumes, pricing and better chemical-sector performance. PACE contributed about €45 million during the second quarter, while savings totaled €85 million in the first half.
Wacker said it has reduced spending through tighter budgets, procurement measures, lower technical spending and structural actions. The company also reached an agreement with its Workers’ Council to reduce 1,600 positions in Germany. The resulting personnel savings are expected to become mainly visible from 2027.
The company continues to target more than €300 million in savings by 2028. Cost of goods sold was flat year over year despite higher volumes, while selling, general and administrative expenses declined, according to Chief Financial Officer Tobias Ohler.
Net income reached €350 million, or €6.86 per share. The result included €243 million of non-operating effects related to the sale of Siltronic shares and the revaluation of Wacker’s remaining stake after Siltronic’s capital increase.
Chemicals Segments Improve, Construction Remains Weak
Silicones sales increased 6% year over year to €757 million, with higher volumes and prices more than offsetting currency effects. EBITDA rose to €123 million, supported by PACE savings, mix effects and pricing. Wacker raised its full-year outlook for the division and now expects mid-single-digit percentage sales growth and an EBITDA margin above the prior-year level.
Ohler said demand in electronics, healthcare, energy and coatings remained comparatively strong, while construction, industrial applications and consumer markets were more muted. Construction markets remained particularly weak in China, he said, with no turnaround visible from management’s perspective.
Polymers sales rose 12% to about €406 million, driven primarily by pricing, slightly higher volumes and an improved regional mix. EBITDA increased to €69 million, aided by PACE and a positive inventory valuation effect. Ohler said the effect represented a low-double-digit million-euro contribution and was not expected to repeat.
For Polymers, Wacker expects mid-single-digit percentage sales growth for 2026 and an EBITDA margin above the prior-year level. The company said it responded quickly to raw-material inflation with regional price adjustments, although it expects lower raw-material costs to require corresponding pricing adjustments later in the year.
Management cautioned that ordering patterns remain short term. Customers had pulled some orders into the first quarter following conflict in the Middle East, and the company expects typical European summer seasonality to weigh on third-quarter sales.
Polysilicon Focuses on Semiconductor Growth
Polysilicon sales rose 3% to about €226 million in the second quarter as higher semiconductor-grade volumes offset lower solar-grade prices. EBITDA was €11 million, with semiconductor demand and cost savings offset by weak solar pricing, higher energy costs and solar inventory destocking.
Wacker said semiconductor-grade polysilicon volumes increased roughly 10% in the first half and are expected to improve sequentially in the second half under its contract structure. Hartel said artificial-intelligence-related data-center investment is supporting semiconductor demand, though he noted that demand can take one to two years to flow through the supply chain.
Solar conditions remain difficult, marked by weak demand and low capacity utilization across the value chain. Wacker has reduced polysilicon inventory by 20% from a year earlier while operating its plants below efficient utilization, Ohler said.
Uncertainty surrounding U.S. Section 232 trade proceedings continues to limit visibility and customer purchasing decisions. Management said a decision could affect its long-term manufacturing footprint, but stressed that no pre-decision had been made regarding potential plant closures. Wacker expects polysilicon sales to rise by a high-single-digit percentage in 2026, with EBITDA close to the prior-year level.
Guidance Raised, Balance Sheet Remains Solid
Wacker raised its 2026 EBITDA guidance to between €625 million and €750 million, reflecting second-quarter operating performance, expected year-end seasonality and the pension accounting effect. The company expects EBITDA in its “Other” segment to be negative €15 million for the year, improved from prior guidance of negative €50 million.
Biosolutions sales increased 13% to €99 million, supported by pricing and biopharmaceutical project business. EBITDA was €7 million. Wacker maintained its outlook for high-single-digit percentage sales growth and EBITDA of around €30 million in the division.
At the end of June, Wacker had shareholder equity of €4.18 billion, liquidity of €1.57 billion and an equity ratio of 48%. Net financial debt stood at €722 million, and the company expects it to decline to around €500 million by year-end. Full-year capital expenditures are expected to total about €300 million, below depreciation as major expansion projects have been completed.
Wacker plans to present new group-level targets at its Capital Markets Day in London on Sept. 17.
About Wacker Chemie (ETR:WCH)
Wacker Chemie AG, together with its subsidiaries, provides chemical products worldwide. It operates through four divisions: Wacker Silicones, Wacker Polymers, Wacker Biosolutions, and Wacker Polysilicon. The Wacker Silicones division offers silanes, siloxanes, silicone fluids, silicone emulsions, silicone elastomers, silicone resins, and pyrogenic silica. The Wacker Polymers division provides binders and polymeric additives, such as dispersible polymer powder and vinyl acetate-ethylene dispersions, which are used in construction, paper, adhesive, paint, coating, and basic chemical industries.
