Evonik Targets Unveils Next Phase of Strategic Growth, Targeting €1 Billion EBITDA Increase by 2027
Evonik Targets At its recent Capital Markets Day in Essen, Evonik, a global leader in specialty chemicals, laid out an ambitious blueprint for its future, signaling a significant step forward in its strategic transformation. The company’s leadership emphasized a sharpened focus on four core pillars: a differentiated portfolio structured into two new segments, pioneering sustainable innovations, a balanced and diversified regional presence, and fostering a culture grounded in mutual respect coupled with a strong performance orientation.
Evonik Targets This strategic recalibration is designed not only to sharpen Evonik’s competitive edge but also to drive substantial operational and financial improvements by 2027. Central to this ambition is the company’s goal to elevate its return on capital employed (ROCE), a key indicator of financial health and operational efficiency, to approximately 11 percent. Concurrently, Evonik aims to boost its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) by a substantial €1 billion over its 2023 baseline figures, reflecting a balanced approach between growth and cost optimization.
Balanced Growth and Cost Optimization: Two Sides of the Same Coin
Evonik Targets CEO, Christian Kullmann, succinctly framed the company’s dual approach: “We are working consistently on two sides of the same coin – on our growth opportunities and on our costs.” The company’s strategic pivot builds on lessons learned from the economic challenges faced in 2023, transforming adversity into an opportunity to refine its strategic roadmap and set clear, measurable objectives for the future.
“Evonik Targets Our goals are ambitious but grounded in the quality of our business and the clear opportunities we see ahead,” Kullmann noted. Among these opportunities are potential benefits arising from economic stimulus initiatives currently being rolled out in Germany and throughout Europe, which could further accelerate demand for Evonik’s specialty chemical solutions.
Driving Growth Through Innovation and Market Expansion
Evonik Targets anticipates that approximately half of the targeted €1 billion EBITDA increase—about €500 million—will stem from growth initiatives. These initiatives focus on ramping up capacity utilization at newly commissioned plants and accelerating sales of innovative products developed within the company’s three key Innovation Growth Areas.
Evonik Targets These growth areas position Evonik in specialized, high-value niches that are both resilient and poised for expansion. Examples include fully biodegradable biosurfactants, which respond to the increasing global demand for environmentally friendly and sustainable ingredients, advanced catalysts that enhance biodiesel production efficiency, and innovative membrane technologies offering superior performance in filtration and separation processes.
Evonik Targets This portfolio focus aligns with global trends emphasizing sustainability, circular economy principles, and cleaner energy solutions—markets where Evonik’s products can deliver differentiated value and help customers meet stringent regulatory and environmental standards.
Cost Efficiency: Enhancing Profitability Through Optimization
Evonik Targets On the other side of the equation, Evonik is committed to generating the remaining €500 million of EBITDA improvement through rigorous cost optimization programs. Many of these measures are already underway, underscoring the company’s proactive stance on enhancing operational efficiency.
Evonik Targets One flagship initiative is “Evonik Tailor Made,” a comprehensive program aimed at streamlining production processes, reducing waste, and improving overall productivity across multiple business units. This is complemented by targeted efficiency drives within specific segments such as Animal Nutrition, Silica, and High Performance Polymers—each leveraging tailored strategies to eliminate redundancies and optimize resource use.
Additionally, the “ePro” procurement program is expected to contribute meaningfully by enhancing purchasing efficiency and supplier negotiations, thereby lowering input costs without compromising quality or supply chain resilience.
Financial Discipline and Shareholder Value
Maike Schuh, Evonik’s Chief Financial Officer, emphasized the company’s disciplined financial approach, highlighting the importance of executing growth, cost, and portfolio strategies in tandem to bolster key financial metrics. “Through 2027, our focus will be on these core areas to improve returns and strengthen our balance sheet by reducing debt,” Schuh stated.
Evonik Targets Currently, Evonik plans to refrain from acquisitions, allowing the company to concentrate fully on internal initiatives and organic growth. However, Schuh pointed out that the solid cash flow generated and successful portfolio execution will likely create room for future shareholder-friendly actions, including share buybacks.
“Evonik Targets The strong cash flow and the successful execution of portfolio measures will make additional distributions to our shareholders an option in the coming years,” she noted, underscoring Evonik’s commitment to balancing reinvestment in growth with rewarding shareholders.
Commitment to Sustainability and Innovation Leadership
Evonik Targets Beyond financial targets, Evonik is steadfastly advancing its sustainability agenda, setting two ambitious environmental and innovation goals for 2030.
First, the company aims to increase the proportion of its revenue derived from “Next Generation Solutions”—products with verifiable sustainability benefits—to 50 percent by 2030, up from 45 percent in 2024. This milestone reflects Evonik’s commitment to delivering value that not only meets but exceeds customers’ environmental performance expectations.
Second, Evonik pledges to reduce its own greenhouse gas emissions (Scope 1 and Scope 2) by 25 percent within the same timeframe. These efforts are embedded in the company’s broader sustainability strategy, which integrates responsible resource use, energy efficiency improvements, and investment in clean technologies.
Importantly, the company’s Executive Board remuneration will be tied to these financial and sustainability targets, aligning leadership incentives with Evonik’s long-term value creation and environmental stewardship goals.
A Vision for the Future: The “Superforce” in Sustainable Chemistry
Christian Kullmann summarized Evonik’s vision with a compelling metaphor: “At Evonik, we already stand for sustainable innovation and thus for the green transformation. But we want to achieve even more in the future: We want to be the Superforce in our customers’ products and enable them to offer even more efficient and sustainable products with tailor-made solutions—in all market areas.”
This vision captures Evonik’s ambition to serve as an indispensable innovation partner for its customers, helping them meet evolving market demands and regulatory requirements through cutting-edge specialty chemicals and customized solutions.
The “Superforce” concept also reflects Evonik’s aspiration to deepen customer relationships, leverage its technical expertise, and expand its footprint across diverse end markets, including automotive, agriculture, healthcare, construction, and consumer goods.
Regional Diversification and Cultural Strength
In addition to innovation and sustainability, Evonik’s strategy emphasizes a balanced regional footprint designed to reduce risks associated with geopolitical and economic fluctuations. By diversifying its global presence, the company aims to capitalize on growth opportunities in emerging markets while maintaining strong positions in established regions.
Internally, Evonik is nurturing a culture of mutual respect and performance orientation, recognizing that its people are a critical driver of success. Initiatives focused on talent development, diversity and inclusion, and agile working practices aim to foster engagement and empower employees to deliver on the company’s ambitious goals.
