Financial Result and Income After Taxes

  • Financial result slightly below previous year; considerable year-on-year growth in net income
  • Earnings per share increase from €5.12 to €9.17

The financial result amounted to minus €750 million in 2019, compared with minus €741 million in the previous year.

At minus €45 million, net income from shareholdings was down €2 million from the previous year, mainly as a result of lower dividend income.

Higher interest expenses for financial indebtedness led to a lower interest result of minus €465 million (2018: minus €363 million), largely from higher U.S. dollar commercial paper during the year. In addition, interest expenses of €39 million arose in connection with leases.

This was partly offset by a €95 million improvement in the other financial result, primarily due to lower expenses from hedging of financial indebtedness.

Income before income taxes decreased from €5,233 million in the previous year to €3,302 million in 2019. Income taxes declined accordingly, from €1,117 million in the previous year to €756 million in 2019. The BASF Group tax rate amounted to 22.9% in 2019, after 21.3% in 2018. The increase was mainly attributable to taxes for prior years, especially in Germany and the United States.

Income after taxes from continuing operations declined from €4,116 million to €2,546 million. Income after taxes from discontinued operations rose by €5,082 million to €5,945 million. This figure included the construction chemicals business and, until the end of April, our oil and gas activities. A book gain of €5,684 million from the deconsolidation of the Wintershall companies following the merger of the oil and gas activities of Wintershall and DEA on May 1, 2019, contributed significantly to the increase. The income after taxes of the discontinued construction chemicals business was €24 million, around €10 million below the prior-year figure. The decrease was mainly driven by special items in connection with the planned divestiture.

Noncontrolling interests declined by €202 million to €70 million, largely from the lower earnings of Shanghai BASF Polyurethane Company Ltd. due to lower margins and as a result of the above-mentioned deconsolidation of the Wintershall companies in the second quarter of 2019.

Net income amounted to €8,421 million, considerably higher than the prior-year figure of €4,707 million due to the above-mentioned book gain. Earnings per share were €9.17, compared with €5.12 in 2018.