German speciality chemicals maker Lanxess (LXSG.DE)on Thursday toned down its full-year profit expectations and warned that already elevated energy and freight costs could go even higher in the fourth quarter, sending its shares down sharply.

Lanxess’ shares, down 7.1% at 1112 GMT, are headed for their worst day since March 2020 when the coronavirus pandemic pummeled European stocks.

A rebound in economic growth after the pandemic has led to a surge in energy and raw material prices, putting pressure on companies to try to pass on the higher costs.

Cologne-based Lanxess, which makes a fifth of its sales from the auto industry, said it had managed to pass on the high raw material prices by adjusting selling prices amid global materials shortages.

But the company flagged further pricing increases to offset the steep rise in energy and freight costs.

Chief Executive Matthias Zachert said the company had gone with 20% price increases in the third quarter. “I have never had that before during my tenure at the company, it’s something exceptional.”

Zachert said prices for raw materials had stabilised in the meantime and added the chemicals industry was likely nearing a peak in the cost inflation, which would then be passed on to the wider industry and consumers through increased product prices.

Lanxess said that due to the cost increases, strained supply chains and power rationing in China, its underlying core earnings (EBITDA) would be at low end of the earlier forecast range of 1 billion to 1.05 billion euros ($1.15-$1.21 billion).

“The guide implies 4Q adjusted EBITDA of around 210 million euros which is around 12% below current implied Vara consensus,” JP Morgan analysts said.

The group’s underlying core earnings rose 44% to 278 million euros in the three months ended in September, but were only slightly above analysts’ average estimate of 276 million euros.

Germany’s BASF (BASFn.DE), the world’s largest chemicals maker by sales, last month raised its 2021 earnings guidance as large industrial customers readily accepted marked-up prices for basic chemicals.