BASF strategies to become leading chemical company
29 Nov '11
4 min read
“Innovations of this kind require a broad portfolio, interdisciplinary cooperation and a deep understanding of our customers' value chains. We therefore will continue to develop our portfolio in the direction of customer-focused businesses,” explained Brudermüller. In 2020, sales of €30 billion and an EBITDA of €7 billion are to be generated with products that have been on the market for less than 10 years.
Furthermore, sustainability is becoming one of the main drivers of growth and value creation. BASF's customers want sustainable products and system solutions, and the company's employees expect BASF to closely integrate sustainability into its day-to-day activities. “More sustainability can only be achieved through innovation – and that is where chemistry plays an essential role,” said Brudermüller. In the future, sustainability will therefore be more strongly integrated into business decisions.
Business expansion in emerging markets BASF's sales to customers in emerging markets have almost tripled in the past 10 years and accounted for approximately one-third of total sales (excluding Oil & Gas) in 2010. In 2020, the company expects current emerging markets to contribute 45 percent to sales. Investments will boost the company's future growth. Between 2011 and 2020, BASF plans capital expenditures of €30 billion to €35 billion. More than one-third of this amount will be invested in emerging markets. “We already have leading positions and fast growing businesses in emerging markets, and this is something we will build on,” said Bock.
Solid and shareholder-oriented financial strategy BASF's financial strategy will continue to take account of the criteria needed to maintain its solid A rating. “This also includes our ambitious dividend policy and the possibility, in principle, of buying back shares,” said Engel. A new strategic excellence program, STEP, will also increase competitiveness and profitability. STEP is expected to contribute around €1 billion to earnings by the end of 2015.
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