BASF's sales in the fourth quarter of 2020 increase by 8% year-on-year

On January 20, BASF released preliminary data for the fourth quarter and full year of 2020. Sales in the fourth quarter of 2020 increased by 8% year-on-year to 15.905 billion euros. This is mainly caused by the increase in sales volume and prices; however, unfavorable currency factors have a certain offsetting effect.

Sales for the full year of 2020 decreased by 167 million euros to 59.149 billion euros, higher than the range of 57 billion euros to 58 billion euros predicted in October 2020.

BASF Group stated that its operating performance in the fourth quarter of 2020 was better than expected. Earnings before interest and taxes excluding special items are expected to be 1.113 billion euros, an increase of 32% over the same period last year, slightly higher than the analyst's highest forecast. Compared with the third quarter of 2020, the EBIT in the fourth quarter of 2020 excluding special items increased by 532 million euros.

In the fourth quarter of 2020, the EBIT excluding special items in the materials, chemicals, and industrial solutions business areas significantly exceeded analysts’ average forecasts. The earnings before interest and taxes excluding special items in the two major business areas of surface treatment technology, nutrition and care are slightly lower than the average forecast of analysts. Affected by unfavorable currency factors, the pre-interest and tax earnings excluding special items in the agricultural solutions business area were significantly lower than the consensus forecast of analysts. Earnings before interest and taxes excluding special items in the "other" business areas are slightly higher than analysts' average forecasts.

For the full year of 2020, the BASF Group’s EBIT excluding special items is expected to be 3.560 billion euros, which is higher than the range of 3 billion euros to 3.3 billion euros predicted in October 2020, and slightly higher than the analyst's highest forecast. Compared with the previous year, EBIT excluding special items fell by 23%. The year-on-year decline in the BASF Group’s EBIT excluding special items was mainly due to the sharp decline in the income contribution of the chemical, surface treatment technology, materials, and agricultural solutions business areas; the nutrition and care business area did not include special items’ interest Earnings before tax decreased slightly compared with the same period last year; the industrial solutions business area remained the same as the previous year; and the pre-interest and tax loss excluding special items in the "other" business area increased significantly compared with 2019.

The pre-interest and tax earnings of the BASF Group in the fourth quarter of 2020 are expected to be 932 million euros, higher than the same period last year and analyst consensus forecasts.

The EBIT for the full year of 2020 fell to minus 191 million euros. This was mainly due to the impairment of no cash flow in the third quarter of 2020 and the accrual of structural adjustment expenses, but it was still higher than the average analyst forecast.