BASF Reported Strong Results Despite High Raw Materials and Energy Prices
While presenting the 2022 third quarter results along with Chief Financial Officer Dr. Hans-Ulrich Engel, Chairman of the Board of Executive Directors of BASF SE, Dr. Martin Brudermüller, stated that in spite of the persisting high prices of raw materials and energy, BASF managed to attain solid earnings in the third quarter.
Compared to the previous year's quarterly sales were higher by 12 percent at USD 22,041,693000.00 (EUR 21.9 billion). The increase in sales was driven by the risen prices in nearly all segments. The only segment that recorded lower price levels was the Surface Technologies segment due to the low prices of precious metals. All segments witnessed a positive impact as a result of currency effects. In addition, portfolio effects also boosted sales growth. The sales development was negatively impacted by lower volumes in all segments excluding Agricultural Solutions.
Compared to the 2021 third quarter of USD 1,308,248500.00 (EUR 1.3 billion), Income from operations (EBIT) before special items dipped by USD 520148530.00 (EUR 517 million). Brudermüller stated that their downstream segments Surface Technologies, Nutrition & Care and Industrial Solutions and Agricultural Solutions, considerably boosted their profits. Despite that, the Chemicals and Materials segment earnings significantly dropped in comparison to last year's very high quarter levels.
Compared to last year's quarter USD 1,810,962000.00 (EUR 1.8 billion), EBIT was significantly lower at USD 1,308,248500.00 (EUR 1.3 billion). The following figure comprises the income of integral companies accounted for employing the equity method, which dipped to USD 76445284.00 (EUR 76 million) by USD 124726516.00 (EUR 124 million), primarily as a result of the low contribution in earnings from BASF-YPC Company Ltd., Nanjing, China.
In contrast to 2021 quarter three, the operations before depreciation income, amortization and special items (EBITDA before special items) dipped to USD 2313475700.00 (EUR 2.3 billion) lower by USD 448613114.00 (EUR 446 million) and EBITDA dipped to USD 2313475700.00 (EUR 2.3 billion) lower by USD 476915100.00 (EUR 474 million).
Compared to the previous year's quarter to USD 102627300.00 (EUR 102 million) the shareholding's Net income rose by USD 16098400.00 (EUR 16 million). Special charges for impairments of about USD 744551000.00 (EUR 740 million) were included in the income from non-integral entities that were calculated using the equity method in connection with harm to the Nord Stream 1 pipelines, in which BASF maintains an indirect stake through Wintershall Dea AG. The (after tax) operational result of Wintershall Dea accountable to BASF rose to USD 633882060.00 (EUR 630 million) by USD 536248635.00 (EUR 533 million) compared with the 2021 third quarter.
The total income before the income tax cut lowered by USD 541342594.00 (EUR 538 million) in comparison to last year's quarter to USD 1207476000.00 (EUR 1.2 billion) during quarter three of 2022. Compared to the 2021 quarter three income Net income declined by USD 346143120.00 (EUR 344 million) to USD 914663070.00 (EUR 909 million).
Operating activities cash flows added up to USD 2312926000.00 (EUR 2.3 billion) in quarter three of 2022, improved by USD 407276100.00 (EUR 405 million) in the previous year's quarter. In 2022, quarter three Free cash ?ow came to USD 1307306000.00 (EUR 1.3 billion) which is higher by USD 219225160.00 (EUR 218 million) compared to the prior-year quarter.
As per Procurement Resource, the article states that the 2022 third quarter results of BASF have managed to gain profits despite the high prices of energy and raw materials.