The Chairman and CEO’s Review
Conrad, what were the main challenges Clariant faced in 2025, and how did the company navigate them?
Conrad Keijzer: 2025 was characterized by a persistent low-demand environment and we are pleased with how Clariant responded to these challenging conditions. While we saw some moderation in inflation, global demand across key sectors remained subdued. The anticipated recovery in consumer durable goods spending did not materialize. Our industry continues to face significant oversupply in certain markets, as China has built up significant local capacity in recent years.
Amidst these headwinds, our sales of CHF 3.915 billion were flat in local currencies. We maintained strict pricing discipline and initiated the execution of our new CHF 80 million performance improvement program, which has already delivered CHF 50 million in savings in 2025. Together with effective price management and cost productivity across the company, these measures improved our EBITDA margin before exceptional items by 180 basis points to 17.8 %.
This builds on three consecutive years of EBITDA improvement, both in absolute and margin terms, which underscores the success of our transformation. The numbers tell a compelling story: We have achieved 320 basis points of improvement from 14.6 % in 2023 to 17.8 % in 2025. What particularly pleases me is that every business unit and all corporate functions contributed to this achievement.
The recorded net loss of CHF 41 million is due to a non-cash cumulative translation adjustment (CTA) of CHF 230 million, stipulated by IFRS following our Venezuela divestment. This has no impact on cash or operating performance. Without this exceptional effect, we would have reported a Group profit of CHF 189 million.
Ben, how do you assess the broader chemical industry landscape in 2025?
Ben van Beurden: 2025 was again a challenging year for the chemical industry, dominated by uncertainty from the ongoing war in Ukraine and unresolved trade tensions.
We are seeing a fragmented regional picture. China’s chemicals sector was relatively robust, but US recovery has been delayed, and Europe remained under pressure from energy prices three to five times higher than the US and weak domestic demand.
Against this backdrop, our performance demonstrates resilience and strategic clarity. The fundamentals Conrad described – margin expansion, cost discipline, and substantial operational progress – show that even in difficult markets, a well-executed strategy delivers results.
Clariant’s financial position has strengthened considerably. We reduced net debt to CHF 1.414 billion and our leverage ratio at 2.03x, down from 2.25x, indicating our commitment to maintain investment grade rating. This improved financial flexibility, combined with robust cash generation, positions us well to invest in our strategic growth priorities while maintaining reliable shareholder distributions.
Based on our strong financial performance in 2025, the Board of Directors recommends a regular distribution of CHF 0.42 per share to the Annual General Meeting on 1 April 2026. We maintain this distribution level, demonstrating our commitment to providing reliable returns to shareholders while preserving financial flexibility in an uncertain environment.
Beyond the financial performance, what other highlights stand out from 2025, Conrad?
Conrad Keijzer: Let me highlight three important metrics: our employee and customer Net Promoter Scores, and our safety performance.
Our employee Net Promoter Score increased by 9 points to +34, surpassing our target by 4 points, with all business units and functions showing improvement. We achieved a 7-percentage point increase in overall engagement to 69 % in our January 2025 survey.
Our January 2026 employee engagement survey showed an impressive 87 % score in engagement, placing us now in the top quartile of the industrial sector benchmarks. This tells me that despite external challenges, our efforts to foster a new culture are paying off.
Helped by a diligent role out of our commercial excellence programs, our Customer Net Promoter Score increased to 50, up from 45 in 2024, placing us in the top quartile among peers. We received outstanding scores for product quality, technical support, and customer service.
Last but not least: safety. Our DART rate – Days Away, Restricted, or Transferred – reached 0.13 in 2025, down 24 % from 0.17, marking our third straight year of improvement. This performance positions us also in the industry’s top quartile, according to the American Chemistry Council’s database.
However, we are committed to a zero-accident culture, so we can never be satisfied as long as we are not incident free. The safety of our employees therefore will remain our most important priority.
»While the debate around sustainability has intensified, we are convinced that the point of no return is already behind us. Companies that stay the course will shape the future and gain enduring competitive advantage.«
Conrad Keijzer
Chief Executive Officer (CEO)
Ben, how do you see Clariant’s achievements connecting to broader market trends?
Ben van Beurden: Our performance demonstrates that we are aligned with fundamental megatrends that reshape our industry and the global economy. We operate in an environment defined by regional economic shifts, changing demographics, accelerating digitalization, and above all, decarbonization and growing demand from health- and sustainability-conscious consumers.
These megatrends are driving real changes in customer behavior. Our strengthened customer engagement, even in difficult markets, shows we are addressing needs that matter deeply. Customers increasingly value our partnerships and are willing to pay for solutions that help them meet sustainability commitments and navigate energy transition challenges.
Conrad, could you provide more details on the performance of the business units?
Conrad Keijzer: Each business unit faced different market dynamics, but they all contributed to our margin improvement:
Care Chemicals, our largest business unit with sales of CHF 2.112 billion, maintained flat local currency sales with pricing discipline and a 1% scope impact from the Lucas Meyer Cosmetics acquisition. Growth in Crop Solutions, Mining Solutions, and Personal & Home Care offset declines in Industrial Applications. EBITDA margin improved to 19.3%, up 100 basis points, demonstrating strong operational execution.
Catalysts saw local currency sales decline 2 % to CHF 816 million, driven by lower volumes and stable pricing. Strong growth in Ethylene catalysts and Syngas & Fuels offset weakness in Specialties and Propylene. Despite lower sales, the business achieved a remarkable EBITDA margin improvement to 20.8 %, up 340 basis points.
Adsorbents & Additives delivered CHF 987 million in sales, flat in local currency, with 1% pricing gains offsetting volume declines. Continued improvement in Additives did not fully offset weakness in Adsorbents, where delayed US renewable fuel regulation impacted volumes. The EBITDA margin before exceptional items reached 17.1%, up 130 basis points.
Conrad, Clariant introduced differentiated segment steering in 2024, assigning each business to one of five strategic mandates – »Boost,« »Outgrow,« »Grow at Market,« »Turnaround,« or »Harvest.«. What updates can you share on how segments are performing against their strategic mandates?
Conrad Keijzer: The differentiated steering model has really proven its value. It gives us a clear view of where to focus and how to allocate resources more effectively. Each segment knows exactly what its role is – whether that’s driving above-market growth, improving profitability, or improving cash generation – and that clarity is helping us move faster and make better decisions.
In 2025, we saw growth in targeted segments across all business units. What particularly excites me are the clear turnaround stories we have achieved in Coatings & Adhesives and Polymer Solutions which significantly improved their profitability and their competitive position. This demonstrates that our systematic approach to portfolio management is working and that we can successfully turn around underperforming businesses through focused execution.
What progress did Clariant make on its sustainability agenda?
Conrad Keijzer: While the debate around sustainability has intensified and policy-driven headwinds have emerged, we are convinced that the point of no return is already behind us. The transformation toward more sustainable business models will not reverse and companies that stay the course will shape the future and gain enduring competitive advantage.
I am particularly proud that we achieved a 9 % reduction in greenhouse gas emissions across all three categories – Scope 1, 2, and 3. This puts us well ahead of our trajectory, and we have updated our targets accordingly to reflect our accelerated progress and increased ambition.
One standout solution is our automated Product Carbon Footprint engine, »CliMate.« Using primary site data and supplier-specific emission factors, it offers unmatched transparency, helping customers make informed, low-carbon choices. Encouragingly, many are willing to pay a premium for lower-footprint products, creating tangible commercial advantage.
We have made steady progress on diversity, with female representation in management rising from 16 % in 2021 to 25 % in 2025, towards our 2030 ambition of over 30 %. Leaders with national origin outside Europe increased from 32 % to 37 %, advancing toward our 40 % ambition.
Our external recognition has further strengthened. I am very pleased that we improved our scores in two important sustainability ratings: Clariant is now among the top 1% of all companies rated by Ecovadis and by Carbon Disclosure Project (CDP).
Given your experience with sustainability transformations, what is your perspective on Clariant’s approach, Ben?
Ben van Beurden: Having led large-scale sustainability transformations, I have learned that sustainability is not just about setting targets – it is about transforming operations, building partnerships across the value chain, and creating solutions that customers value and are willing to pay for.
What Conrad described with the CliMate engine is exactly the kind of practical innovation that matters. It is not just measurement for measurement’s sake – it creates commercial value and transparency that enables customers to make better decisions.
We are also leveraging digital innovation to drive sustainability outcomes. The CLARITY™ cloud-based service portal for Catalyst customers is a good example: It provides customers with 24/7 real-time catalyst performance monitoring and plant optimization and is now serving over 800 users across 220 customer plants across 38 countries. This kind of digital transformation creates value for customers while advancing sustainability goals.
»The most important step in this transformation was our commitment to customer centricity and innovation leadership. Customers are willing to pay a premium for solutions that help them meet sustainability commitments.«
Ben van Beurden
Chairman of the Board of Directors
Conrad Keijzer: Building on Ben’s point about innovation, we are pleased with our progress against this important objective. Clariant achieved an Innovation Rate of 18.8 % in 2025, up from 16.9 % in 2024, and we are on track toward our target of around 20% by 2027.
What I find particularly encouraging is that innovation is becoming a true driver of organic growth and products from our innovation pipeline are clearly outgrowing the rest of our portfolio. In 2025, we invested CHF 125 million in R&D, representing 3% of our sales.
We are intensifying supplier partnerships to co-develop innovations meeting the highest environmental and ethical standards. At our Clariant 2025 Supplier Innovation Day, we invited early-stage involvement of our key suppliers and we launched an interactive collaboration platform.
These investments in innovation are yielding results that customers recognize.
L’Oreal recognized us with their supplier excellence award, and Unilever recognized us with their Innovation Award for our TexCare™ polymer innovation, which enables effective laundry cleaning in 15 minutes at room temperature, significantly reducing energy and water consumption.
We were also acknowledged as number one in our industry for artificial intelligence integration in the chemical and pharmaceutical industry Germany (»VAA – Fach- und Führungskräfte Chemie« survey). Since launching our own artificial intelligence tool ClaritaAI in 2023, it has become an essential partner in our labs, production sites, and offices – accelerating discovery, simplifying processes, and enhancing customer relationships.
Ben, there has been significant focus on the claims in relation to infringement of competition law on the ethylene purchasing market. What can you tell stakeholders?
Ben van Beurden: What I can state unequivocally is that Clariant firmly refutes these claims and will adamantly defend its position in the proceedings. Clariant has substantiated economic evidence that the conduct of the parties did not produce any effect on the market.
I want to emphasize that the resulting weak performance of the share price does not at all reflect our actual performance. When you look at our operational execution – margin expansion, cash generation, innovation progress, customer and employee engagement – the business is performing well and executing its strategy. We remain focused on delivering the strategic and financial targets we have set, which we believe will be reflected in valuation over time.
Looking ahead to 2026, what is your outlook for the industry and for Clariant?
Ben van Beurden: Let me start with the macroeconomic picture. There are limited indications for a significant economic recovery in 2026. We expect overall GDP growth of 2.8 %. However – and this is important – growth in the chemical industry is currently decoupled from GDP growth. Trade policy developments and geopolitical risks continue to create significant uncertainty in global markets.
Looking at chemical market fundamentals, they continue to show a challenging landscape across major regions. The world’s value-added output for chemicals is expected to be 1.9 % in 2026, with clear weakness in the US at -0.6 % and in Europe at +0.5 %. Even in China, growth rates are well below previous years’ levels at 2.7 %. We expect softer industrial production in Europe and 3 – 4 % inflation, driven primarily by wages.
That said, there are positive signals. Outlooks forecast 2026 growth in copper production, construction, and automotive, especially electric vehicles. We also see potential in data centers, consumer electronics recovery, and gradual improvement in renewable fuels demand, supporting our adsorbents products.
Conrad Keijzer: Given this mixed picture, we are setting realistic guidance for 2026 while continuing to deliver on our purpose lead growth strategy with discipline.
We are continuing the execution of the CHF 80 million savings program – we expect to deliver roughly another CHF 20 to CHF 30 million this year, bringing us to the full run-rate target. There will be a negative sales impact from portfolio pruning of around 1 % at Group level, reflecting our commitment to focus on attractive, profitable and sustainable segments.
Beyond that, we expect slight underlying growth in Care Chemicals and slight growth in Adsorbents & Additives, while Catalysts is expected to remain at a similar level. In a raw material environment with volatile costs, we will also focus on pricing to protect our margins.
Taking all these factors together, we are guiding for around flat sales in local currency and a further improvement of the EBITDA margin to around 18 % before exceptional items. This represents another step toward our medium-term targets and demonstrates our commitment to further expand profitability even in a challenging demand environment.
There are significant changes coming to the Board of Directors in 2026. Can you explain the rationale, Ben?
Ben van Beurden: The Board decided to reduce its size from eleven to eight members starting in 2026, aligning with Clariant’s streamlined operations and addressing investor concerns regarding independence, tenure, and gender diversity.
In support of these efforts, five directors – Roberto Gualdoni, Geoffery Merszei, Eveline Saupper, Peter Steiner, and Konstantin Winterstein – decided not to stand for reelection at the AGM on 1 April 2026. I want to thank them for their valuable service to Clariant.
The Board proposes two new candidates: Regula Wallimann and Albert Manifold. Their extensive experience in finance and leadership will be important assets, ideally complementing the six members standing for re-election.
Finally, looking beyond 2026, what is your confidence in Clariant’s medium-term trajectory?
Ben van Beurden: Our strategic shift into a focused specialty chemicals company presents exciting growth opportunities. The most important step was our commitment to customer centricity and innovation leadership.
This focus allows us to help our customers reduce their greenhouse gas emissions and save energy with our innovative and sustainable products. For these kinds of solutions, customers are willing to pay a premium, which strengthens our competitiveness. This is not theoretical – we are seeing this dynamic play out in practice, as mentioned with the carbon footprint transparency driving commercial value.
Our three Innovation Arenas – Health- and Sustainability-conscious Consumers and Brands, Energy Transition, and Circularity – are aligned with irreversible global trends. These are not short-term opportunities; they represent fundamental shifts in how our customers operate and what end-consumers demand. We are positioned to capture a disproportionate share of the growth in these areas.
Conrad Keijzer: Building on Ben’s point, I can clearly confirm our commitment to customer centricity and innovation leadership. We are committed to deliver our mid-term targets which reflect a further step up in profitability from the current roughly 18 % to the 19 – 21 % range. Our purpose-led growth strategy has delivered results in a challenging environment, marked by the war on Ukraine, inflation, surging gas prices in Europe, and tariffs. We have increased absolute EBITDA and EBITDA margins year-by-year thanks to our performance improvement programs and through pricing, as we continue to deliver recognized value to our customers.
In terms of free cash flow conversion, we have already delivered 42 % in 2025, up from 32 % in 2024 and already exceeding our 2027 target, and we expect to maintain this minimum level going forward.
We are positioned to grow above market with our innovation sales growing faster than our portfolio. Our international footprint, with the new plants for care chemicals and additives in Daya Bay, China, that we started up last year, position us well for continued growth in China.
Finally, our top quartile customer net promoter score and top quartile employee engagement scores show we have built a strong foundation to drive sustainable growth above the market when market conditions normalize.
The chemical industry will continue to face some challenges, but Clariant has the strategy, the portfolio, the innovation pipeline, the execution capability, and the people to outperform and create value for all stakeholders in the years ahead.
