Basf's third-quarter sales of 21.9 billion euros rose 12 percent from a year earlier

On Oct. 26, BASF reported sales of 21.9 billion euros in the third quarter of 2022, up 12 percent year on year. Basf said the growth was driven by significant price increases across almost all lines of business, positive currency factors in all lines of business, and a mix of businesses that effectively contributed to sales growth. However, with the exception of the agricultural solutions business segment, all other business segments experienced a decline in sales volume, which greatly curbed sales growth.

Basf's EBIT before special items was EUR 1.3 billion in the third quarter of 2022, down EUR 517 million from the third quarter of 2021. Earnings in its chemicals and materials business fell sharply, compared with strong performance in the same period last year.

Basf's earnings before interest, taxes, depreciation and amortization (EBITDA), excluding special items, were EUR 2.3 billion in the third quarter, a decrease of EUR 446 million compared to the third quarter of 2021. Earnings before interest, taxes, depreciation and amortization were 2.3 billion euros, down 474 million euros from a year earlier.

On October 12, 2022, BASF announced a cost-saving plan. A number of cost-cutting measures will be implemented until the end of 2024, and the overall plan is expected to save €500m a year when completed.

Brudermuller, chairman of BASF Europe's executive board, sees the plan as a response to worsening earnings progress in Europe and Germany and challenging regulatory framework conditions. First, the European chemicals market has experienced weak growth over the past decade, 钬? He says. Second, the sharp rise in gas and electricity prices this year has put pressure on the chemical industry value chain."

Natural gas costs at BASF's European production sites increased by an additional EUR 2.2 billion in the first nine months of 2022 compared to the same period in 2021. "Not only that, but the uncertainty created by the large number of regulations and policies planned by the European Union is adding to the burden on the chemical industry." "Mr. Brudermuller added.

"These challenging regulatory framework conditions in Europe are jeopardising the international competitiveness of local manufacturers and forcing BASF to make permanent changes to our cost structure as soon as possible," Brudermuller said. The resulting cost savings plan is designed to protect our competitiveness in Germany and the region in the medium to long term.

Despite the sharp economic downturn that began in the third quarter of 2022, BASF maintained its previous forecast for 2022 in its first-half results: sales of 86 billion to 89 billion euros and EBIT before exceptional items of 6.8 billion to 7.2 billion euros.