BASF annual results

In 2002, BASF maintained their global leadership in the chemical industry. Despite a difficult environment, the company surpassed their forecasts for the past financial year. Sales of €32.2 billion were at about the same level as in 2001. EBIT before special items climbed more than 25% to €2.88 billion. Despite the tense situation in important customer industries, sales volumes of BASF products increased significantly. Even so, the positive growth in volumes of almost 8% could not fully offset negative price and currency effects. In 2002, BASF shares again performed better than the DAX and EURO STOXXSM share indexes. The company is maintaining its shareholder friendly dividend policy and will recommend to the Annual Meeting that the dividend be increased by €0.10 to €1.40 per share. At BASF's Annual Press Conference on March 18, 2003, in Ludwigshafen, Dr. Jürgen F. Strube said: 'These figures show that we have the right strategy. We are not passively waiting for an upturn, but are acting quickly and decisively. The restructuring initiatives we launched in 2001 made a positive impact last year. We have drastically reduced our costs, streamlined our organisation, and sharpened our customer focus. We are confident that we will achieve our goal of cutting our costs by around €1 billion by the end of this year.' At the same time, BASF are investing in highly profitable business areas and growth markets. Uncertainty clouds outlook for 2003 BASF got off to a good start in 2003. Year-to-date sales are up versus the first two - admittedly weak - months of 2002. However, Strube commented that this could not necessarily be seen as an indication of how things will continue as the year progresses. On the one hand, prognoses based on various indicators permit a broad range of possible outcomes, many of which are contradictory. On the other hand, further development is burdened by the uncertainty surrounding the further development of the Iraq conflict. According to Strube, it is therefore possible to give only a very limited prediction of how the chemical industry and BASF will develop this year. For the first quarter of 2003, BASF anticipate higher sales and a significantly higher EBIT before special items. In the second quarter, however, it expects to have about the same level of sales as in the second quarter of 2002 and a lower incremental increase in earnings. 'BASF have been able to further improve their performance, even during a weak economic period. We have reduced our costs, increased the efficiency of our processes, enhanced our customer focus, reduced our weaknesses and reinforced our strengths. We intend to continue on this course during the difficult coming months of 2003. Our motto remains valid: We see change as an opportunity', said Strube.