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Outlook

Profitable growth with the “We create chemistry” strategy

Outlook 2013

The global economy will likely grow slightly faster in 2013 than in 2012. However, we continue to expect a volatile environment. Excluding the effects of acquisitions and divestitures, we strive to increase our sales volumes in 2013. We want to exceed the 2012 levels¹ in sales and income from operations. An expected increase in demand and our measures to improve operational excellence and raise efficiency will contribute to this. We aim to earn a high premium on our cost of capital once again in 2013.

The global economy is likely to grow slightly faster in 2013. However, we continue to expect a volatile environment. We anticipate an upturn in the chemical industry, primarily supported by strong growth in the emerging economies.

Excluding the effects of acquisitions and divestitures, we strive to increase our sales volumes in 2013. We want to exceed the 2012 levels in sales and income from operations. The expected increase in demand, together with our measures to improve operational excellence and raise efficiency, will contribute to this. We aim to earn a high premium on our cost of capital once again in 2013.

As presented in detail in chapter Economic environment, we anticipate a slight increase in global economic growth (+2.4%) and an upturn in global chemical production (+3.6%) for 2013. In our forecast, we assume an average oil price of $110 per barrel, and an average exchange rate of $1.30 per euro. In view of the opportunities and risks, we want to once again increase sales and earnings.

We have applied international accounting standards IFRS 10 and 11 since January 1, 2013. As a result, some companies which were previously fully consolidated and several which were proportionally consolidated will now be accounted for in the BASF Group Financial Statements using the equity method. In our forecast, we have applied the previous consolidation method in order to ensure comparability with the prior year. Overall, the application of IFRS 10 and 11 will lead to lower reported sales and income from operations, especially in the Oil & Gas segment. Net income will not be significantly influenced by the change in accounting standards. We will adjust the prior-year figures for future reporting periods. The qualitative statements made in our forecast remain valid.

The following sales and earnings forecast for the segments is based on the BASF Group segment structure which was effective until December 31, 2012.

1 The application of international accounting standards IFRS 10 and 11 as of January 1, 2013, will lead to lower reported sales and income from operations for the BASF Group. The qualitative statements made in the forecast also remain valid on this basis.