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BASF significantly increases sales and earnings on the basis of ongoing business
Ludwigshafen (ots) - * First-quarter growth in 2001 still high * Strongest growth in Oil & Gas * Significant increase in earnings expected in the second quarter
In the first quarter of 2001, BASF continued on its course for growth. Compared with the same period of the previous year, sales increased by almost 10 percent to approximately ¤9.3 billion. Income from operations before special items rose by more than four percent to ¤962 million. On the basis of ongoing business, first-quarter sales climbed by almost 25 percent, thus exceeding the growth rate seen in the year 2000. Income from operations on the same basis rose by seven percent.
In the past months, the company has made significant changes to its portfolio: Attractive business areas such as agricultural products, vitamins and superabsorbents were strengthened, the company's businesses in polyolefins and textile dyes were incorporated in joint ventures, and the pharmaceuticals business was sold. Ongoing business is the term used to refer to BASF's current activities. In terms of its ongoing business, BASF has further increased its sales and earnings.
"With our ongoing business we are concentrating on what we do best: Innovative chemistry. This is how we will gain additional competitive advantages," explained Dr. Jürgen F. Strube, Chairman of the Board of Executive Directors, at BASF's 49th Annual Meeting in Mannheim. "Because of our global set-up and our restructured portfolio, we anticipate a significant increase in income from operations before special items in the second quarter," said Dr. Strube, stressing the positive outlook for 2001 to shareholders. "We are therefore sticking to our goal of increasing our income from operations before special items by an average of at least 10 percent per year in 2000 through 2002."
Growth in all regions and segments
* On the basis of ongoing business, BASF achieved significant sales growth in all regions, with its Asian companies being again most successful.
* All segments reported a large increase in sales with most posting double-digit growth. The Oil & Gas segment had the largest increase rising nearly 70 percent. Significant growth was also recorded in the Chemicals and Agricultural Products & Nutrition segments.
* The highest contribution to earnings came from the Oil & Gas segment with ¤376 million.
* The second highest contribution was made by the Agricultural Products & Nutrition segment with ¤300 million, thanks in particular to the successful integration of the crop protection business of American Home Products.
* In the segments Chemicals, Plastics & Fibers and Colorants & Finishing Products, income from operations declined compared with the first quarter of 2000. The main reason for this was a decrease in demand in North America, which led to difficulties in passing on the necessary price increases for consumer-related products.
The sale of BASF's pharmaceuticals business to Abbott, which was completed at the beginning of March, generated extraordinary income of more than ¤6 billion. As a result, the company's first-quarter income before taxes exceeded ¤6.6 billion and net income was almost ¤6.2 billion or ¤10.19 per share.
Outlook for 2001: Prospects for another good year
Overall, 2001 should be another good year for BASF. "Despite some critical developments, we have set ourselves the goal of achieving a further significant increase in our sales and earnings on the basis of ongoing business," said Dr. Strube. To achieve this goal, BASF will take advantage of its refocused portfolio, its strong presence in all important regions of the world's economy and its numerous innovations in products and processes.
BASF is a transnational chemical company that aims to increase and sustain its corporate value through growth and innovation. The company's product range includes high-value chemicals, plastics, colorants and pigments, dispersions, automotive and industrial coatings, agricultural products and fine chemicals as well as crude oil and natural gas. BASF's approach to integration, known in German as "Verbund," is one of its particular strengths, ensuring cost leadership and a unique competitive advantage. With sales in 2000 of about ¤36 billion (circa $34 billion) and a workforce of 103,000 employees, BASF is one of the world's leading chemical companies. BASF acts in accordance with the principles of Sustainable Development. BASF shares are traded on the stock exchanges in Frankfurt (BAS), London (BFA) and New York (BF). The company's Internet address is www.basf.com.
The following information can be found on the Internet:
First Quarter results 2001
From 7.30 a.m. http://www.basf.de/Interimreport
Speech by Dr. Strube at the Annual Meeting
At 11.00 a.m. http://www.basf.de/Pressconference
ots Originaltext: BASF
Dr. Hartmut Unger
Tel. +49 621 60-9 91 23
Fax +49 621 60-9 26 93