Sales and earnings forecast for the segments

Sales in the Chemicals segment are likely to grow considerably in 2017. We anticipate higher sales prices as a consequence of rising raw material prices, as well as volumes growth from factors such as the startup of new plants. We assume that strong competitive pressure will continue, especially on the markets for butanediol, isocyanates and caprolactam. EBIT before special items is likely to match the level of 2016. We expect the earnings contribution from the increase in sales volumes to offset both margin pressure and higher fixed costs. Fixed costs will rise especially in the Intermediates division, mainly as a result of scheduled plant turnarounds and initial expenditures for the new acetylene plant in Ludwigshafen.

In the Performance Products segment, we expect the market environment to remain challenging, but nevertheless aim to slightly increase sales in 2017. This will be largely supported by volumes growth in all divisions, thanks in part to higher plant capacity utilization rates as well as the startup of new production capacities. We anticipate higher fixed costs in 2017, especially from new plant startups. This rise will be more than offset by strict cost discipline and measures to increase competitiveness in all divisions. As a result, we forecast slightly higher EBIT before special items compared with 2016.

We want to achieve a considerable sales increase in the Functional Materials & Solutions segment in 2017. The Chemetall business acquired from Albemarle will contribute to this, as will the sales volumes growth anticipated in all divisions. Our forecast is supported by the expectation of continuing good demand from the automotive and construction industries. The divestitures completed in 2016 in the Catalysts and Coatings divisions, along with a probable decline in precious metal prices, will slow sales growth. As a result of higher sales, EBIT before special items is likely to slightly exceed the level of 2016.

For the Agricultural Solutions segment, we anticipate stable market development for crop protection products in 2017. Our goal is to utilize growth potential on the market primarily through the launch of innovative products, growth in the emerging markets – especially Asia – and a strong customer focus. We are planning to increase volumes in 2017 and considerably boost sales levels. Because of ongoing margin pressure in a market environment that remains challenging, we assume a slight increase in EBIT before special items.

Our planning for the 2017 business year in the Oil & Gas segment is based on an average price for Brent blend crude oil of $55 per barrel. Gas prices in northwestern Europe are likely to hover above the level of 2016. We anticipate a considerable rise in sales and EBIT before special items. Higher prices for oil and gas and a contribution from our share in the Yuzhno Russkoye natural gas field exceeding that of the previous year will substantially support this development. In 2016, the excess amounts received over previous years were compensated as contractually agreed with our partner, Gazprom.

Sales in Other are expected to considerably increase in 2017, primarily as a result of higher prices in raw material trading. We also anticipate a considerable rise in EBIT before special items as compared with 2016.