Home / Knowledge / News / Textiles / BASF displays exemplary results in face of adversities
BASF displays exemplary results in face of adversities
31
Jul '08
The Chemical Company - is in top form. In both the second quarter and the first half of 2008, the company has again increased sales and income from operations (EBIT) before special items and achieved new records. First-half sales amounted to EUR 32.2 billion, 10 percent more than in the same period of 2007.

EBIT before special items in the first six months of 2008 rose by 15 percent to around EUR 4.8 billion. In the second-quarter, BASF increased sales by 11 percent to EUR 16.3 billion, while EBIT before special items climbed approximately 19 percent to EUR 2.4 billion.

"Demand for our products remains strong, and the summer lull does not seem to be very pronounced. However, sales prices have to be increased considerably in some cases in order to pass on significantly higher raw material costs. Our strong figures show once again that we have chosen the right strategy of sharpening our customer focus, increasing our cyclical resilience and concentrating on growth markets," said Dr. Jürgen Hambrecht, Chairman of the Board of Executive Directors of BASF SE, during his presentation of the company's latest results.

BASF confirms confident outlook for full-year 2008:
Despite a slight decline, BASF's chairman said that he was still expecting global chemical production to grow at 2.4 percent in the current year, and that he anticipated global economic growth of 2.8 percent.

BASF has increased its forecast for the average price of Brent crude to $120 per barrel in 2008 and expects an average exchange rate of $1.55 per euro. In addition to extremely high and volatile raw material prices and the weak U.S. dollar, Hambrecht sees risks posed by a growing trend to stagflation and the aggravation of geopolitical tensions.

"Despite the challenging economic environment with high raw material costs, we are confident that we will achieve the goals we have set for 2008. Assuming that there are no changes to BASF's portfolio, we aim to increase sales and to improve EBIT before special items slightly," said Hambrecht.

BASF has also set itself long-term financial goals: In each of the next five years, the BASF Group aims to achieve an EBITDA margin of 18 percent. Even under trough conditions, the company expects to realize an EBITDA margin of more than 14 percent. This goal is based on the following long-term assumptions: an unchanged portfolio, an oil price (Brent) of $100 per barrel and an exchange rate of $1.40 to $1.50 per euro. In the same period, BASF aims to post average volume growth two percentage points above the relevant chemical market.

BASF's Chief Financial Officer Dr. Kurt Bock spoke in his presentation about the company's share buyback program. In the first half of 2008, BASF bought back shares for EUR 1.1 billion and thus completed the EUR 3 billion buyback program that it announced in February 2007 six months ahead of schedule.

"In June, we decided that we would repurchase further shares for a total of EUR 3 billion. This program was already started in July and is scheduled to be completed by mid-2010," said Bock. The goal of the share repurchase is to further optimize BASF's balance sheet structure and increase earnings per share. All of the shares repurchased are therefore cancelled, and BASF SE's share capital is reduced accordingly.

Higher sales in all segments:
In the Chemicals segment, BASF significantly increased sales by 18 percent thanks to higher volumes and prices. EBIT before special items declined by 34 percent compared with the second quarter of 2007. This was due in particular to considerably lower margins for cracker products.

Second-quarter sales in the Plastics segment rose by 4 percent due to higher volumes and prices. The Polyurethanes division especially contributed significantly higher volumes. EBIT before special items declined by 14 percent, above all due to weaker business in North America.


Must ReadView All

Apparel/Garments | On 21st Sep 2017

UK fashion exports £10.7 bn in 2016; highest till now

Exports of British fashion goods rose to £10.7 billion in 2016, the...

Apparel/Garments | On 21st Sep 2017

BFC announces partnership with Chinese firm JD.com

The British Fashion Council (BFC) has forged a new partnership...

Textiles | On 21st Sep 2017

Indonesia’s textile exports may reach $15 billion by 2019

Indonesia’s textile-related exports are projected to reach $15...

Interviews View All

Siddharth Biyani
Mangalam Industries Pvt Ltd

‘The manufacturing sector is improving day-by-day, becoming better in...

Priyanka
Studio Priyanka Rajiv

‘To reinvent the age-old tradition of embroidery to suit demographics and...

Shiladitya K Joshi
Truetzschler India Private Limited

India ITME provides a platform to interact with our stakeholders

Johan Berlin
InvestKonsult Sweden AB

Investkonsult Sweden AB has been buying and selling second-hand textile...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Steve Cole
Xerium Technologies

Steve Cole of Xerium Technologies discusses the industry. Xerium is the...

Nisha Chanda
Whistling Woods International School of Fashion

<div>A lack of upgraded courses in costume designing and fashion as per...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Judy Frater
Somaiya Kala Vidya

Among the many honours showered on Frater, including Fulbright and Ford...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

September 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
74.5%
No
12.8%
Skip
12.8%

Total Votes: 47

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
61.7%
No
25.5%
Skip
12.8%

Total Votes: 47

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.2%
No
6.4%
Skip
6.4%

Total Votes: 47

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
70.2%
No
10.6%
Skip
19.1%

Total Votes: 47


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search