BASF Posts Very Strong Results in Q2-07

In the second quarter and first half of 2007, BASF has exceeded the record results posted in the same periods of the previous year. In the second quarter, BASF increased sales by 19% and income from operations (EBIT) before special items by 6%. Cumulative sales in H1-07 amounted to EUR 29.3 bln, or 18% more than in the same period of 2006. In the first half of this year, EBIT before special items rose by approximately 10% to EUR 4.1 bln. BASF confirms optimistic forecast for full-year 2007 as demand for chemical products is currently high, with no signs of a slowdown. Scheduled plant turnarounds, in particular in the Petrochemicals division, are likely to reduce earnings by EUR 150 million in the second half of 2007. Q2 sales in the Chemicals segment climbed 50% due to higher sales volumes and prices and the contribution from the acquired catalysts business. EBIT before special items also rose significantly by more than 70%, with a considerable contribution from the Petrochemicals division. In the Plastics segment, sales increased by 10% in Q2 due to higher volumes and sales prices. Earnings rose by 15%, due to significantly higher earnings in the Styrenics division. BASF's sales increased in all regions in the first half of 2007. The strongest growth in percentage terms was seen in South America, Africa, Middle East and in Asia. In Europe, companies posted total sales of EUR 17.4 bln in the first half. This corresponds to an increase of 14%. EBIT before special items rose by 6 % to EUR 3.1 bln. This was due to the acquired businesses and organic growth in the chemical businesses, in particular in Petrochemicals. Companies in North America increased sales by 26% in dollar terms and by 18 % in euro terms in the first half. EBIT before special items declined by 3% to EUR 544 million. This was due to the shutdown of the TDI plant in Geismar, Louisiana, for a number of weeks, as well as currency effects and the impact of divestitures in the Agricultural Products division. The acquired businesses and strong earnings in the Petrochemicals division were unable to offset this fully. Growth remains strong in Asia Pacific, where BASF increased sales by 34% in local currency terms and by 27% in euro terms. EBIT before special items also rose considerably by 58% to EUR 380 million. The investments in the Verbund sites in Kuantan, Malaysia, and Nanjing, China, are paying off. In Africa and the Middle East, sales rose in particular thanks to the contribution of the Catalysts and Construction Chemicals divisions.
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