UpdateGermany’s BASF Q1 net profit doubles to €2.41bn on strong sales

06 May 2011 11:17  [Source: ICIS news]

(Adds regional sales results, quotes and investment plans.)

LONDON (ICIS)--BASF’s first-quarter net income more than doubled to €2.41bn ($3.49bn) from €1.03bn in the same period a year earlier, because of strong sales and increased capacity utilisation, the German chemicals major said on Friday.

Sales in the first quarter rose by 25% year on year to €19.4bn, while earnings before interest, tax, depreciation and amortisation (EBITDA) rose by 28% to €3.37bn, BASF said in a statement.

BASF said it achieved double-digit earnings growth in all regions.

In Europe, sales were 24% higher than the 2010 first quarter, with demand for chemical products remaining high. In North America, sales rose by 21% in US dollars and 22% in euro terms. In the Asia-Pacific region, sales were 28% higher in local-currency terms and 33% higher in euro terms, with an increase in chemicals sales volumes.

“The Cognis businesses acquired in December 2010 made a significant contribution to this substantial sales growth,” said BASF CEO Jurgen Hambrecht, who will be replaced on Friday by Kurt Bock, BASF’s CFO.

BASF said capacity utilisation rates at its plants were good and demand in its chemicals business – chemicals, plastics, performance products and functional solutions – increased compared with the 2010 first quarter.

“Despite strong increases in raw materials costs, income from operations before special items rose by 40% to €2.7bn,” Hambrecht added.

BASF said the recent earthquake in Japan and the tense political situation in North Africa have not had a significant impact on its first-quarter results. However, BASF said it assumes that it will not be able to resume crude oil production in Libya in 2011.

“The company expects a higher annual average oil price. Therefore, the previous forecast of $90 per barrel has been raised to $100 per barrel,” BASF said.

Hambrecht also said that BASF is to expand its presence in Asia. Investments will be made to expand the Chinese verbund site in Nanjing, China, with partner Sinopec and the speciality chemicals business in Kuantan, Malaysia, with partner Petronas.

Last month, BASF started building a methyl di-p-phenylene isocyanate (MDI) complex in Chongqing, China.

($1 = €0.69)

For more on BASF visit ICIS company intelligence

By: Tanzeel Akhtar
+44 208 652 3214

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