BASF confident of earnings increase11 September 2002
BASF have reported second quarter sales level with the same period of 2001, while earnings before interest and taxes (EBIT) and before special items increased by almost 10%. 'In 2002 overall, we aim to achieve higher EBIT before special items than in 2001 on the basis of a roughly similar level of sales', said Jürgen Strube, chairman of the board. 'We are not idly waiting for an upturn, but are acting now. The structural measures that we were early in implementing are showing their effects. Our cost-reduction programme is proceeding according to plan. Our strategy is the right one. We have a solid financial structure and our financial strength provides us with room to manoeuvre. 'For example, we have been able to initiate a new share buy-back programme. By the end of the year, we plan to buy back BASF shares for €500 million and, thus, further reduce our cost of capital.' Looking at first half 2002 results, cumulative sales amounted to €16.6 billion in the period from January-June 2002. When sales from the pharmaceuticals business are excluded, this is only 3.7% less than in the strong first half of 2001. At €822 million, EBIT before special items was almost 10% higher than in the second quarter of 2001. In the first half of the year, EBIT before special items was €1.64 billion, €73 million less than in the first half of 2001. 'The strongest improvement in earnings was seen in our chemicals, plastics and fibres and performance products segments.' In the chemicals segment, major advances were made in the second quarter. With an increase in some sales prices, second-quarter sales in the chemicals segment rose by 20% to e1.4 billion compared with the same period of 2001. At €161 million, EBIT before special items climbed 33% compared with the second quarter of 2001.