Financial Position

At €42,555 million, equity was only slightly above the figure as of December 31, 2021. Alongside the positive effect of €1,221 million from net income, around €820 million was deducted for own shares purchased under the share buyback program as of March 31, 2022.

The slight decline in other comprehensive income was mainly attributable to losses from hedging transactions, which were partially offset by positive translation effects. The equity ratio declined from 48.2% to 45.3% due to the increase in total assets.

Compared with year-end 2021, noncurrent liabilities rose by €1,115 million to €26,335 million, mainly due to higher financial indebtedness. This primarily resulted from the issue of two €1 billion eurobonds. The reclassification of a bond and a loan in U.S. dollars with an aggregate carrying amount of around €800 million from noncurrent to current financial indebtedness had an offsetting effect. Provisions for pensions and similar obligations rose slightly; the decline in obligations as a result of higher interest rates in relevant currency zones was more than offset by higher inflation assumptions for Germany and the negative performance of plan assets.

At €25,093 million, current liabilities were €5,012 million above the figure as of December 31, 2021. This was largely due to the €2,519 million increase in current financial indebtedness. In addition to the above-mentioned reclassifications from noncurrent to current financial indebtedness, this primarily reflected the increase in commercial paper at BASF SE by around €2 billion. The main offsetting effect was the scheduled repayment of a bond denominated in U.S. dollars with a carrying amount of around €450 million. Trade accounts payable rose by €1,161 million due to business-related factors. The €1,126 million increase in current provisions to €5,060 million was primarily the result of higher provisions for discounts and bonuses. Other liabilities were down €314 million from the prior year-end figure, mainly due to lower advance payments received.

Net debt¹ rose by €1.9 billion compared with year-end 2021.

Cash flows from operating activities amounted to –€290 million, an improvement of €235 million compared with the first quarter of 2021. The improvement was mainly attributable to miscellaneous items (€746 million compared with –€335 million in the prior-year quarter), in particular the elimination of equity-accounted income in this item. These were impacted by the impairment charges recognized at Wintershall Dea and were therefore negative overall. The main offsetting effects were the €497 million decrease in net income and the €409 million increase in cash tied up in net working capital. This rose from €2,773 million in the first quarter of 2021 to €3,182 million in the first quarter of 2022, primarily as a result of a stronger inventory build-up than in the prior-year period. A higher level of cash tied up in receivables was offset by an almost equal increase in cash released from liabilities.

Cash flows from investing activities amounted to –€579 million (Q1 2021: –€435 million). The change was mainly attributable to payments made for property, plant and equipment and intangible assets, which rose by €147 million to €603 million.

The €3,504 million increase in financial indebtedness led to a significant rise in cash flows from financing activities. This was partly offset by payments of €820 million made for the share buyback program that started at the beginning of the year. Overall, cash flows from financing activities rose from €710 million in the prior-year quarter to €2,685 million in the first quarter of 2022.

Free cash flow¹ improved by €88 million to –€893 million.

BASF enjoys good credit ratings, especially compared with competitors in the chemical industry. Standard & Poor’s most recently confirmed its rating of A/A-1/outlook stable on January 6, 2022. Moody’s most recently confirmed BASF’s A3/P-2/outlook stable rating on January 5, 2022. Fitch’s rating of A/F1/outlook stable from June 11, 2021, also remained unchanged.