BASF has reported encouraging financial results. Fourth-quarter sales rose 9% to €19.6bn while earnings before interest and taxation (Ebit) climbed 18% €1.8bn.
The chemicals giant said revenues and earnings would rise in 2013 thanks to a recovery in demand and efficiency measures.
Sales for 2012 were €78.7bn, up 7% year-on-year, with earnings were €8.9bn, up 5% on 2011. “We aim to grow again in 2013 and exceed the 2012 levels in sales and Ebit bit before special items,” said Kurt Bock, BASF chairman.
“Innovations are the basis for future profitable growth and thus lie at the core of our competitiveness,” he added. BASF would therefore increase its research and development spending in 2013, after investing €1.7bn in the past year – around 9% more than in 2011.
BASF’s sale of plastics increased – up 4% to €11.4bn – in part due to continuing strong demand from the automotive industry, particularly in North America and Asia, reported the company. Ebit before special items rose substantially due to a significant improvement in earnings in polyurethanes.
Speaking at a BASF presentation, Bock said said the group expected “a gradual decline” in global economic uncertainty, an increase in investor and consumer confidence, and an upturn in the chemical industry “primarily supported by stronger growth in the emerging markets”.
These aspirations were dependent upon world economic growth of 2.4%, compared with 2.2% in 2012; global chemical production growth of 3.6% (2.6%), an average euro/dollar exchange rate of $1.30 per euro ($1.28) and an average oil price of $110/barrel ($112).
BASF was meanwhile on-track with its STEP programme to cut costs, improve productivity – and which has seen its divisions reduced from six to five – and add “around €1bn to earnings annually from 2015”, he added.