After a strong quarter, BASF is raising its annual targets again

Released on 27.10. 2021

  • View of the BASF factory premises in Ludwigshafen. Photo: Uwe Anspach

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Because of the recovery from the Corona crisis, the chemicals business is also booming. But the world’s largest manufacturer BASF is also struggling with rising costs.

Ludwigshafen (dpa) – Business of the world’s largest chemical company, BASF, is going well thanks to strong demand and higher prices. The company is therefore becoming more optimistic for the year as a whole.

It expects sales for 2021 between 76 billion and 78 Billion euros, as the Dax group announced on Wednesday. Previously, BASF had sales between 42 billion to 77 billion euros assumed. The company is also becoming more confident on the profit side.

However, BASF expects the supply bottlenecks to affect the overall economic recovery in the fourth quarter as well. The Ludwigshafen-based company is assuming growth in industrial and chemical production of 6 percent each for the year as a whole. The management had previously calculated at 6.5 percent.

Stable demand

The demand for BASF products was stable over the summer months stayed, said CEO Martin Bruderm├╝ller. Compared to the third quarter of the previous year, BASF increased prices by 27 percent and volumes by 6 percent. With strong contributions to earnings from the basic chemicals and plastics divisions, the earnings mix was comparable to that of the previous quarter. said Bruderm├╝ller. BASF was only able to partially offset these higher costs with price increases. The downstream business includes the Nutrition & Care division, which supplies food and feed manufacturers as well as the pharmaceutical, cosmetics, detergent and cleaning agent industries Car production negatively affected due to the lack of semiconductors. This particularly affected the Surface Technologies division, which offers car paints and catalytic converters, for example. The shortage of semiconductors will continue at least in the first half of the coming year.

Group-wide sales in the third quarter increased compared to the corona-torn period of the previous year 42 percent to around 19, 7 billion euros. This was due to higher volumes and, above all, significantly higher prices. The operating result (EBIT) before special items rose to just under 1.9 billion euros. In the business with seeds and weed killers, the result was negative despite higher sales due to significantly higher fixed costs, increased raw material prices and logistics costs.

The bottom line was that BASF posted a profit of 1. 25 billion euros. In the previous year there was a loss of a good 2.1 billion euros due to depreciation.

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