Actual development compared with outlook for 2017

In 2017, BASF Group sales rose considerably in line with our forecast. EBIT before special items also increased considerably in 2017 and was higher than the slight growth forecast at the beginning of the year. This was primarily attributable to the sales and earnings development in the Chemicals segment, which exceeded our expectations. As a result, we also saw considerable growth in EBIT in 2017, instead of the slight increase we had anticipated. We likewise recorded a considerable increase in EBIT after cost of capital, contrary to our prediction of a considerable decrease. As well as the higher EBIT generated by the segments, this was also due to the cost of capital, which did not increase as strongly as expected due to currency effects.³

Sales in the Chemicals segment increased considerably as forecast, whereby we achieved higher prices than expected. EBIT before special items was expected to be on a level with the previous year. However, the higher margins, especially for the isocyanates business in the Monomers division, significantly exceeded our expectations. Margins were also stronger in the Petrochemicals and Intermediates divisions. As a result, EBIT before special items was considerably higher than the 2016 figure.

We slightly increased sales in the Performance Products segment in line with our forecast. Contrary to our expectations, there was a considerable decline – rather than a slight increase – in EBIT before special items. This was primarily attributable to softer margins, mainly as a result of higher raw materials prices, which would not be fully passed on via sales prices.

Sales in the Functional Materials & Solutions segment rose considerably, as predicted. EBIT before special items did not increase slightly as expected, but declined considerably despite sales growth. The decrease was due to lower margins and higher fixed costs.

We had forecast considerable growth for sales in the Agricultural Solutions segment. However, sales only rose slightly as the higher volumes were partially offset by price declines, particularly in South America, and negative currency effects. The lower average margin and the difficult market environment in Brazil had a stronger impact on earnings development than anticipated. Our earnings were also reduced by the shutdowns of our production facilities in Beaumont, Texas, and Manatí, Puerto Rico, because of the hurricanes. As a result, EBIT before special items did not increase slightly, but declined slightly.

In the Oil & Gas segment, sales and EBIT before special items rose considerably as expected.

Both sales and EBIT before special items rose considerably in Other and thus corresponded to our forecast.

In 2017, we invested a total of €3.7 billion in capital expenditures,⁴ less than the anticipated level of around €3.9 billion. Investments in the Chemicals and Oil & Gas segments in particular were below the values considered in our planning.