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Sales of BASF up 42% to €19.7 billion in Q3 2021
Source:Adsale Plastics Network    Editor:JK    Date:29.Oct.2021

BASF Group’s business growth continued in the third quarter of 2021. Demand for BASF’s products remained solid over the summer months. “This enabled us to continue to grow profitably,” said Dr. Martin Brudermüller, BASF’s Chairman of the Board of Executive Directors, who presented the results together with Dr. Hans-Ulrich Engel, Chief Financial Officer at BASF. “Compared with the third quarter of the previous year, we increased prices by 36% and volumes by 6%.”

 

At €19.7 billion, sales were €5.9 billion higher than in the prior-year quarter. This was largely attributable to higher prices in all segments, especially in Chemicals, Surface Technologies and Materials. The sales growth was also due to a significant increase in volumes in almost all segments.

 

At €1.9 billion, income from operations (EBIT) before special items was €1.3 billion higher than the level of the third quarter of 2020. This was mainly driven by the significantly higher EBIT before special items in the Chemicals segment. The significant earnings increases in the Materials and Industrial Solutions segments as well as in Other also lifted earnings.

 

By contrast, earnings contributions from the Agricultural Solutions, Surface Technologies and Nutrition & Care segments declined considerably.


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BASF Group presents the business results of the third quarter of 2021.


“With strong earnings contributions from the Chemicals and Materials segments, the earnings mix in the third quarter of 2021 was comparable with the second quarter of 2021,” told Dr. Martin Brudermüller. “Our downstream businesses are still confronted with further rising raw material, energy and freight costs. Price increases in most downstream businesses could only partially offset these higher costs.”

 

Special items in EBIT amounted to minus €43 million in the third quarter of 2021. Expenses resulted primarily from restructuring measures, divestitures and integration costs. Other income had an offsetting effect. Special items in the previous year were minus €3.2 billion, mainly from impairments in all segments as well as restructuring measures.

 

EBIT amounted to €1.8 billion, considerably above the figure of minus €2.6 billion reported in the prior-year quarter. This figure includes income from integral companies accounted for using the equity method, which rose by €144 million to €200 million, due largely to the higher earnings contribution from BASF-YPC Company Ltd., Nanjing, China.

 

Talking about its outlook for 2021, BASF assumes that supply bottlenecks in many value chains will continue to negatively impact global economic recovery in the fourth quarter of 2021. The assessment of the global economic environment in 2021 has therefore been slightly adjusted (figures for industrial and chemical production rounded to the nearest half percentage point; previous forecast in parentheses):

 

  • Growth in gross domestic product: +5.3% (+5.5%)

  • Growth in industrial production: +6.0% (+6.5%)

  • Growth in chemical production: +6.0% (+6.5%)

  • Average euro/dollar exchange rate of US$1.20 per euro (unchanged)

  • Average annual oil price (Brent crude) of US$70 per barrel (US$65 per barrel)

 

Additionally, based on the BASF Group’s sustained good business performance and the anticipated continuation of solid demand, especially in the Chemicals and Materials segments, the forecast for the 2021 business year was raised in accordance with market expectations (previous forecast from the Half-Year Financial Report 2021 in parentheses):

 

  • Sales growth to between €76 billion and €78 billion (between €74 billion and €77 billion)

  • EBIT before special items of between €7.5 billion and €8.0 billion (between €7.0 billion and €7.5 billion)

  • Return on capital employed (ROCE) of between 13.2% and 14.1% (between 12.1% and 12.9%)

  • Increase in Accelerator sales to between €21.5 billion and €22.5 billion (between €21.0 billion and €22.0 billion)

  • Stabilization of CO2 emissions at between 20.5 million metric tons and 21.5 million metric tons (unchanged)

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