Covestro Accelerates Strategic Transformation Amidst Market Challenges
At the 2025 Annual General Meeting (AGM) of Covestro AG, held virtually on April 17, shareholders approved all resolutions proposed by the Board of Management and Supervisory Board, reaffirming their confidence in the company’s strategic direction. The AGM was broadcast live, allowing shareholders and their proxies to engage actively by submitting questions via video link, emulating the interactive nature of in-person meetings.
Navigating a Challenging Fiscal Year
In his address, CEO Dr. Markus Steilemann reflected on the hurdles faced during fiscal year 2024, marked by persistent market weakness, intense competition, and geopolitical uncertainties. Despite these challenges, Covestro remained steadfast in its commitment to transforming into a circular economy-driven company. “We leveraged our strong foundation and unswervingly implemented the transformation of our company to the circular economy,” Steilemann stated, emphasizing the company’s resilience and strategic focus.
Strategic Focus Areas
Covestro has refined its strategy to align with current market needs, concentrating on four key areas: ongoing transformation, sustainable growth, digitalization and innovation, and the systematic implementation of ambitious sustainability targets. This strategic realignment involves a comprehensive review of the company’s structures and processes to identify and implement efficiency potentials and growth opportunities. “We are now even more agile, leaner, and more targeted in our approach,” Steilemann noted, highlighting the company’s proactive stance in rethinking its operations.
Cost Reduction and Efficiency Goals
A significant component of Covestro’s transformation strategy is the goal to reduce annual costs by €400 million by 2028. This objective will be achieved through performance enhancements and structural improvements, including the targeted management of global production capacities and investments in innovative, sustainable materials. The company is also focusing on expanding key sites to strengthen its competitiveness in advanced markets.The Machine Maker
Advancements in Sustainability and Digitalization
Covestro is making strides in its transition to a circular economy by increasing the use of renewable energies and developing innovative recycling technologies. Digitalization plays a crucial role in this transformation, with efforts to streamline processes and uncover new growth opportunities across the entire value chain. These initiatives are aimed at reducing the company’s ecological footprint and enhancing operational efficiency.
Partnership with XRG
The AGM also highlighted the importance of Covestro’s partnership with XRG, a move seen as pivotal for the company’s future. The transaction, expected to close in the second half of 2025, is anticipated to provide Covestro with additional opportunities to expand its market position as an independently managed company and bolster its contribution to the green transformation. “This is the right step at the right time,” Steilemann remarked, underscoring the strategic significance of the alliance.Covestro AG
Supervisory Board Elections
Shareholders confirmed the reelection of five members of the Supervisory Board for a further two-year term: Dr. Christine Maria Bortenlänger, Lise Kingo, Dr. Richard Pott, Regine Stachelhaus, and Patrick W. Thomas. These individuals bring extensive expertise in capital markets, sustainability, corporate governance, and industry. Dr. Richard Pott was reelected as Chair of the Supervisory Board, continuing his leadership role.
Financial Performance and Dividend Policy
CFO Christian Baier presented the financial results for 2024, noting that while targeted measures led to increased production volumes worldwide, declining selling prices resulted in a 1.4% decrease in sales to €14.2 billion. Higher impairments on property, plant, and equipment contributed to a net loss of €198 million. In line with Covestro’s dividend policy, which ties dividends to the company’s financial situation, no dividend will be distributed for fiscal year 2024.
Covestro remains committed to its strategic transformation, focusing on cost leadership, efficiency, and innovation to shape a sustainable future. “We face major challenges, but under our strategy, we’re driving our transformation with a clear plan,” Steilemann concluded, expressing confidence in the company’s direction and its role as a pioneer in the circular economy.
