BASF Triples Q2 Earnings
29 July 2010 LUDWIGSHAFEN, Germany — Increased demand from a recovering global economy and inventory restocking following the recession helped boost BASF SE’s second-quarter profits more than triple over the same period a year prior, according to the company’s quarterly report. For the period of April through June 2010, BASF reported a net profit of $1.5 billion, up from $445.9 million a year earlier. Total revenue rose nearly 30% to $21.1 billion from $16.2 billion.
Second-quarter revenues in BASF’s chemicals segment grew 64% to approximately $3.9 billion over a weak quarter a year ago. Sales in Agricultural Solutions for Second-quarter 2010 were up 3% year-on-year, resulting from favorable exchange rates and stronger volume sales in South America and Asia. The segment’s earnings before interest (EBIT) and taxes before special items was 13%, or $61.1 million below the previous year due to lower prices and targeted increases in selling expenses and expenditures for research and development.
Sales and earnings increased in all regions. Sales by companies in Europe were 16% higher than in the same period of the previous year, with EBIT before special items increasing 76%, growing $1.5 billion to $3.4 billion mostly based on higher demand in the chemicals business.
North American sales grew by 42%, with earnings rising 202% — a growth of $689 million to $1 billion thanks to higher volumes, sales and earnings in the chemicals business. Sales and earnings in the Agricultural Solutions segment were lower than the previous year’s first half, partially due to lower sales volumes of fungicides business resulting from higher inventories at distributors.
Sales in the Asia Pacific region rose by 55% in local currency terms, and by 60% in euro terms. Earnings grew 145%, increasing $464 million to $784 million due to the region’s economic upturn. Sales and earnings in the Agricultural Solutions segment were higher than the same period of the previous year. South America, Africa and Middle East sales were up year-on-year by 21% in local-currency terms and by 33% in euros, with the Agricultural Solutions business in South America contributing much of the sales growth. Earnings in the region were 6% higher then in the first half of 2009.
BASF expects to increase its sales for the full year and outpace global chemical production, with pretax earnings considerably improved. The company also expects to pay a higher dividend this year.
Get The Newsletter Today!
