After Brenntag (Essen / Germany; www.brenntag.com) recently announced a reorganisation of its operational business structure, the chemicals distributor has now announced drastic cost-cutting measures. With “Project Brenntag”, the group, which generated sales of approximately EUR 12.8 bn in 2019, aims to make an additional contribution to the operating EBITDA of EUR 220m per year. This level is expected to be reached for the first time in 2023. Brenntag estimates that the cost of implementing the cost-cutting measures will be approximately EUR 370m.

As part of the package of measures, Brenntag also announced the closure of about 100 sites worldwide, half of which are third-party logistics sites. At the same time, the group intends to invest in existing and new locations in order to establish regional centres and close gaps in the network; no specific figures or details were given here.

“In order to fully realise our potential, we must become leaner and more efficient,” said CEO Christian Kohlpaintner, also referring to job cuts. Over the next two years, almost 1,300 of the roughly 17,500 positions worldwide are to be cut – 200 of them in Germany alone.

As of January 2021, the company will also be managed as two global business units, Brenntag Essentials and Brenntag Specialties, which are tailored to the changing requirements of customers and suppliers. However, the distribution of chemicals and ingredients as a full-range supplier is supposed to remain the core of the business model.

Against the background of negative effects resulting from the coronavirus pandemic, the world market leader in the distribution of chemicals and ingredients reported a strong Q3 2020 on 4 November 2020. Although the EUR 2.87 bn revenue on the basis of stable exchange rates was 7.7% below the year-on-year result, the gross profit of EUR 690.6m reached the level of the same quarter in the previous year (minus 0.2%), and operating EBITDA rose by almost 5% to EUR 264.4m. With the exception of North America, all other regions – EMEA, Asia-Pacific and Latin America – performed well.

A few days ago, Brenntag also announced a cooperation with CheMondis (Cologne / Germany; www.chemondis.com), the online marketplace that was established two years ago. In a first step, the Essen-based group will offer the portfolio of its segments Paints & Coatings and Adhesives & Sealants on the German market through CheMondis.