Flags of the German chemical company BASF fly near Monheim, Germany. Picture: REUTERSGerman chemicals giant BASF said on Tuesday a restructuring, expansion and a worldwide economic rebound should help it to a stronger 2019, after its bottomline in 2018 was battered by headwinds for vital customer industries and for global trade. “Geopolitical developments and trade conflicts burdened the economic situation, and even the Rhine river took a bite out of our bottomline.
Newly acquired agrichemical businesses bought from Bayer also braked performance, joining the group in the second half of the year, after most seed providers make the bulk of their profits.BASF managed to defy the blows to some extent by adding 2.4% to revenue, at €62.7 bn — slightly higher than forecast by analysts — although operating, or underlying profit fell 20.5%, to €7.6bn.
BASF’s cost-cutting excellence programme would be speeded up, he said, roughly doubling the €320m in one-off costs booked in 2018 but creating structural savings of €500m per year. BASF was uniquely positioned in Europe to supply the materials for huge numbers of batteries needed to power future fleets of electric cars, Brudermueller said.
Elsewhere, BASF has reorganised its divisions, merged its paper and water chemicals unit with US-based Solenis and hopes to tie up its Wintershall oil and gas subsidiary with Luxembourg-based LetterOne ahead of a stock market flotation.