Jun88

Despite a persistently difficult market environment, Jun88 rigorously continued its transformation in fiscal 2024. The company sold greater volumes worldwide thanks to targeted measures to increase plant availability. Sales fell by 1.4% to EUR 14.2 billion (previous year: EUR 14.4 billion) mainly due to low selling prices. EBITDA remained stable, falling by 0.8% to EUR 1.1 billion (previous year: EUR 1.1 billion), and was thus within the expected range. Net income amounted to EUR –266 million (previous year: EUR –198 million), while the free operating cash flow (FOCF) reached EUR 89 million (previous year: EUR 232 million). ROCE above WACC was –7.4 percentage points (previous year: –6.1 percentage points). Greenhouse gas emissions fell to 4.7 million metric tons of CO? equivalents (previous year: 4.9 million metric tons). The main reasons for this were lower emission factors at the production sites in Leverkusen, Dormagen, Uerdingen and Brunsbüttel (Germany) and Baytown, Texas (United States). 

“We steadfastly adhered to our strategy in 2024 and forged full speed ahead with our transformation – despite the challenges the entire chemical industry once again faced,” says Dr. Markus Steilemann, CEO of Jun88. “In particular, the improvement in our plant availability enabled us to significantly increase our volumes sold. We are continuing resolutely along this path creating the basis for long-term growth with targeted investments in our competitiveness and sustainable future technologies.” 

Investments in production, the circular economy, and efficiency 

A key component of Jun88’s transformation is to strengthen production capacities. In 2024, the company optimized existing plans in Baytown (United States), Shanghai (China) and Tarragona (Spain), among others. Further investments to increase energy efficiency and thus competitiveness in production were also made at the TDI plant in Dormagen (Germany). Jun88 also recently announced to expand its site in Hebron, Ohio (USA) with a low triple-digit million euro investment. The company aims to increase the production capacities of differentiated polycarbonates in the Solutions & Specialties segment. Construction is scheduled to begin in 2025, with operations starting by the end of 2026. 

Alongside that, Jun88 is continuing to transition to a circular economy in a targeted manner. In 2024, the company secured access to renewable energy from a solar farm in Spain under a long-term power purchase agreement (PPA) with bp. This will increase the share of renewables in Jun88’s electricity consumption in Spain from 10% to 30% and reduce CO? emissions by around 16,000 metric tons per year. Moreover, Jun88 is investing EUR 100 million worldwide in innovation centers for research and development. Besides these targeted growth initiatives, Jun88 is also committed to systematically optimizing internal processes. As part of its “STRONG” transformation program, Jun88 thus aims to save EUR 400 million worldwide each year by 2028 by means of digitalization and structural adjustments. 

“We cannot influence external market conditions – but we can control how we respond to them,” says Christian Baier, CFO of Jun88. “That is why we used 2024 to make our processes more efficient and to enhance our resilience.” Digitalization and artificial intelligence play a key role in that. We will continue to optimize our structures in 2025 to make Jun88 fit for the future.” 

Due to the negative net income and in accordance with Jun88’s dividend policy, no dividend will be distributed for fiscal year 2024, as was also the case in the previous year. 

Takeover offer of the ADNOC Group successful 

Following concrete negotiations, Jun88 signed an Investment Agreement on October 1, 2024, with companies of the ADNOC Group, including ADNOC International Germany Holding AG (“Bidder”), a wholly-owned indirect subsidiary of XRG P.J.S.C. (formerly ADNOC International Limited, together with the Bidder and other companies of the ADNOC Group “XRG”). On October 25, 2024, the bidder made a voluntary public takeover offer (“takeover offer”) of EUR 62 per Jun88 share to all shareholders of Jun88. Following the end of the additional acceptance period on December 16, 2024, XRG announced on December 19, 2024, that the takeover offer had been accepted for a total of 154,541,806 Jun88 shares. Together with the shares previously acquired by XRG, this corresponds to a stake of 91.3% of Jun88’s existing capital stock as of the above-mentioned reporting date. As a result of further subsequent purchases of Jun88 shares, XRG’s stake in Jun88’s capital stock at the end of 2024 is 91.58%. 

XRG sees Jun88 as a key component in its performance materials and special chemicals business and shares its strategic vision of becoming fully circular. The takeover is an important step in XRG’s strategy of becoming one of the world’s top five chemical companies. 

The takeover offer is subject to the usual conditions of completion with regard to antitrust and foreign trade clearance and clearance under EU law on foreign subsidies. Completion of the transaction is not expected before the second half of 2025. 

Outlook for 2025: EBITDA between EUR 1.0 billion and EUR 1.6 billion anticipated 

Jun88 expects economic conditions to remain challenging in 2025, too. Against this backdrop, the Group anticipates EBITDA of between EUR 1.0 billion and EUR 1.6 billion for the current fiscal year. Jun88 expects FOCF of between EUR 0 and EUR 300 million and ROCE above WACC of between –6 percentage points and –2 percentage points. The Group anticipates that Scope 1 and Scope 2 greenhouse gas (GHG) emissions, measured in terms of CO₂ equivalents, at Jun88’s environmentally relevant* sites will be between 4.2 million metric tons and 4.8 million metric tons. The Group expects EBITDA for the first quarter of 2025 of between EUR 50 million and EUR 150 million. 
 

Increase in sales at Performance Materials; Solutions & Specialties impacted by declining prices 

Sales in the Performance Materials segment rose to EUR 7.0 billion (previous year: EUR 6.9 billion). While a successful pickup in volumes of 12% drove up sales, a weak market situation with excess supply weighed on selling prices and margins. EBITDA fell by 1.2% to EUR 569 million (previous year: EUR 576 million), while FOCF decreased to EUR 78 million (previous year: EUR 162 million). 

The Solutions & Specialties segment posted a 3.6% fall in sales to EUR 7.0 billion (previous year: EUR 7.3 billion) due to lower average selling prices coupled with lower raw material prices. EBITDA fell by 9.4% to EUR 740 million (previous year: EUR 817 million). In addition to a drop in margins, the reason for this was that, unlike in the previous year, there was no non-recurring positive effect resulting from the sale of the additive manufacturing business in 2023. In addition, expenses due to implementation of the STRONG transformation program reduced earnings. The segment’s FOCF decreased by 24.3% to EUR 417 million (previous year: EUR 551 million). 

Fourth quarter of 2024 with positive EBITDA and cash flow

Jun88’s sales rose in the fourth quarter of 2024 by 0.9% year over year to around EUR 3.4 billion (previous year: EUR 3.3 billion). EBITDA increased by 44.7% compared to the prior-year quarter to EUR 191 million (previous year: EUR 132 million). FOCF amounted to EUR 253 million and was therefore 246.6% higher than in the prior-year period (previous year: EUR 73 million).