General
Information
Last Update:
March 1, 2012
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Sales and earnings forecast for the segments

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Forecast by segment (million €)

 

 

 

 

Sales

 

Income from operations (EBIT)

 

2011

Expected 2012

 

2011

Expected 2012

Chemicals

12,958

Increase

 

2,442

Decline

Plastics

10,990

Increase

 

1,259

Increase

Performance Products

15,697

Increase

 

1,361

Increase

Functional Solutions

11,361

Increase

 

427

Increase

Agricultural Solutions

4,165

Increase

 

808

Increase

Oil & Gas

12,051

Increase

 

2,111

Increase

Other

6,275

Decline

 

178

Decline

BASF Group

73,497

Increase

 

8,586

Increase

In the Chemicals segment, we expect sales in 2012 to be above the level of the previous year. This growth will mainly be driven by the Inorganics and Intermediates divisions. As a result of the sale of several plants in association with the divestiture of our fertilizer business, earnings in the Inorganics division will likely decrease. Furthermore, we expect growing pressure on margins, especially in the Petrochemicals and Intermediates divisions. The segment’s earnings are therefore unlikely to match the high level of 2011.

In 2012, we expect sales in the Plastics segment to increase. In the Performance Polymers division, we plan to continue the expansion of our business with engineering plastics and specialties. We expect this business to grow faster than the most important markets and thus significantly increase sales for the division. Due to investments in research and development, in sales activities and in new production facilities, earnings in the Performance Polymers division are likely to be below the level of the previous year. In the Polyurethanes division, we aim for an increase in sales and earnings. Overall, we want to improve earnings for the segment compared with 2011.

We anticipate higher demand for our products and higher sales in the Performance Products segment in 2012. All divisions will contribute to this sales growth. The economic environment in the paper industry, however, is likely to remain difficult, especially in the Europe and North America regions. Nevertheless, thanks in part to growing demand from the Asian market, we also want to achieve sales growth in our continuing operations in the Paper Chemicals division. We strive to increase the segment’s earnings through both lower integration expenses and growth impetus, mainly from the combined businesses of Cognis and BASF. In the Care Chemicals division in particular we expect a significant improvement in earnings.

The Functional Solutions segment will likely benefit in 2012 from growing demand from our key customer industries – the construction and automotive industries. We want to increase sales in all divisions. This sales growth will be particularly driven by our activities in emerging markets. We also expect earnings in all divisions to exceed the previous year’s level.

In the Agricultural Solutions segment, we will continue to pursue our successful innovation strategy in 2012. We expect slight growth in the market for agricultural chemicals. We also anticipate that prices for agricultural commodities will continue to be higher than historical averages, in a market characterized by continuing high volatility. In light of our recently launched products and the expansion of our business in growth markets, we aim to improve sales and earnings.

We assume that the oil price in 2012 will remain at the level of the previous year. Our planning is based on an average oil price of $110 per barrel and an average exchange rate of $1.30 per euro. Owing to the resumption of oil production in Libya at the end of 2011, we expect the Oil & Gas segment to post a rise in sales and earnings.

On October 1, 2011, we transferred our styrenics business to the Styrolution joint venture. Furthermore, we plan to divest our fertilizer business in the first half of 2012. Sales and earnings in Other in 2012 will therefore be below the level of the previous year.

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