BASF REPORTS: sales and earnings improve; demand rises in Germany; more measures to improve structures; price increases needed.LUDWIGSHAFEN, Germany--(BUSINESS WIRE)--Nov. 24, 1994-- BASF BASF Bar Association of San Francisco (since 1872; San Francisco, California) BASF Badische Anilin und Soda Fabrik (German chemical products company) BASF Builders Association of South Florida Group and BASF Aktiengesellschaft -------------------------------------- -0-
FINANCIAL HIGHLIGHTS
(In Millions of DM)
BASF Group:
3rd Quarter 3rd Quarter Change
of 1994 of 1993/a %
Net sales (without petroleum
and natural gas taxes) 10,685 9,705 +10.1 Pct.
Petroleum and natural gas taxes 720 706 + 2.0
Net sales 11,405 10,411 + 9.5
Germany 2,956 2,866 + 3.1
Outside Germany 7,729 6,839 +13.0
Profit before taxes 526 124 +324.2
Capital expenditures 607 1,108 -45.2
Personnel expense/b 2,426 2,429 - 0.1
Jan.-Sept.
1994 1993/a Change
%
Net sales (without petroleum
and natural gas taxes) 32,369 30,072 + 7.6 Pct.
Petroleum and natural gas taxes 2,121 1,904 +11.4
Net sales 34,490 31,976 + 7.9
Germany 8,919 8,969 - 0.6
Outside Germany 23,450 21,103 +11.1
Profit before taxes 1,209 607 +99.2
Capital expenditures 1,893 2,911 -35.0
Personnel expense/b 7,108 7,347 - 3.3
Number of employees/c 107,029 113,586 - 5.8
Year 1993
Net sales (without petroleum
and natural gas taxes) 40,568
Petroleum and natural gas taxes 2,555
Net sales 43,123
Germany 11,822
Outside Germany 28,746
Profit before taxes 1,058
Capital expenditures 4,139
Personnel expense/b 10,045
Number of employees/c 112,020
BASF Aktiengesellschaft:
3rd Quarter 3rd Quarter Change
of 1994 of 1993/a %
Net sales 4,653 4,132 +12.6 Pct.
Germany 1,590 1,565 + 1.6
Exports 3,063 2,567 +19.3
Profit before taxes 242 168 +44.0
Capital expenditures 156 193 -19.2
Personnel expense/b 1,176 1,133 + 3.8
Jan.-Sept.
1994 1993/a Change
%
Net sales 14,089 13,003 + 8.4 Pct.
Germany 4,807 4,685 + 2.6
Exports 9,282 8,318 +11.6
Profit before taxes 726 595 +22.0
Capital expenditures 432 606 -28.7
Personnel expense/b 3,426 3,455 - 0.8
Number of employees/c 46,897 49,373 - 5.0
Year 1993
Net sales 17,423
Germany 6,199
Exports 11,224
Profit before taxes 939
Capital expenditures 791
Personnel expense/b 4,613
Number of employees/c 49,026
/a Without potash potash: see potassium carbonate. potash Name used for various inorganic compounds of potassium, chiefly the carbonate (K2CO3), a white crystalline material formerly obtained from wood ashes. and rock salt operations /b Excluding pension benefits /c At end of respective period OVERVIEW -------- The positive trend in the BASF Group's business in the first half year continued in the third quarter. Even in the summer months, normally a slack 1. (operating system) slack - Internal fragmentation. Space allocated to a disk file but not actually used to store useful information. 2. (jargon) slack period, our sales volumes were up. In comparison with the third quarter of 1993, we increased sales by 10.1 percent, while in comparison with the months January to September 1993 our sales were 7.6 percent higher than in the previous year. Profit before taxes in the third quarter was better than in either of the preceding quarters. In comparison with the previous year's extremely poor figures, the increase amounted to DM 402 million. In the first nine months of the year, we almost doubled earnings compared with the same period last year. With the exception of Oil and Gas, all operating sectors increased their income from current operations. Apart from improved sales, the principal contributory con·trib·u·to·ry adj. 1. Of, relating to, or involving contribution. 2. Helping to bring about a result. 3. Subject to an impost or levy. n. pl. factors here were our steps to reduce fixed costs fixed costs, n.pl the costs that do not change to meet fluctuations in enrollment or in use of services (e.g., salaries, rent, business license fees, and depreciation). and improve structures. Even so, earnings were adversely affected, as they had been in the second quarter, by substantial special charges resulting from restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). , especially at our North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. affiliate BASF Corp. The biggest individual item is special depreciation on tangible assets Tangible Asset An asset that has a physical form such as machinery, buildings and land. Notes: This is the opposite of an intangible asset such as a patent or trademark. Whether an asset is tangible or intangible isn't inherently good or bad. in the Plastics and Fibers and Consumer Products sectors. At BASF Aktiengesellschaft, too, sales during the third quarter were scarcely impacted by the customary summer lull, and matched the previous quarter's level. In comparison with the previous year, the increase amounted to 12.6 percent in the third quarter and 8.4 percent in the first nine months. This was attributable to substantial increases in volumes, especially to foreign customers; the export ratio increased by almost 2 percentage points, to 65.9 percent. OPERATING SECTORS ----------------- In the Oil and Gas operating sector, production and volumes increased. Sales picked up in the third quarter compared with the previous year. Earnings are still burdened by start-up costs in the natural gas business. Our Products for Agriculture recorded gratifying grat·i·fy tr.v. grat·i·fied, grat·i·fy·ing, grat·i·fies 1. To please or satisfy: His achievement gratified his father. See Synonyms at please. 2. increases in sales, both on the fertilizer fertilizer, organic or inorganic material containing one or more of the nutrients—mainly nitrogen, phosphorus, and potassium, and other essential elements required for plant growth. side and in the crop protection business. Higher prices for ammonia ammonia, chemical compound, NH3, colorless gas that is about one half as dense as air at ordinary temperatures and pressures. It has a characteristic pungent, penetrating odor. on world markets raised the production costs of fertilizers. Earnings for crop protection agents again made good progress. In the Plastics and Fibers sector, polyolefins, PVC PVC: see polyvinyl chloride. PVC in full polyvinyl chloride Synthetic resin, an organic polymer made by treating vinyl chloride monomers with a peroxide. , engineering plastics and foams all achieved double-digit sales increases. In the case of commodity plastics, the increase in demand made it possible to improve selling prices, although they remained too low. Sales of fiber products improved as a result of increased volumes. Income from operations has improved, although it is severely affected by plant shut-downs and special depreciation in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , and so remains negative. In the case of Chemicals, the gratifying revival of business continued in the third quarter. The new steam cracker (1) A person who breaks into a computer system without authorization, whose purpose is to do damage (destroy files, steal credit card numbers, plant viruses, etc.). Because a cracker uses low-level hacker skills to do cracking, the terms "cracker" and "hacker" have become at Antwerp is already operating at full capacity. Demand for industrial chemicals and intermediates improved significantly, although in some cases dramatic increases in the cost of raw materials had to be absorbed. Growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. for our fine chemicals, in both sales and earnings, flattened flat·ten v. flat·tened, flat·ten·ing, flat·tens v.tr. 1. To make flat or flatter. 2. To knock down; lay low: The boxer was flattened with one punch. in the third quarter vs. the previous year's high level. Among Dyestuffs dyestuffs npl → colorants mpl dyestuffs dye npl → Farbstoffe pl dyestuffs npl → coloranti and Finishing Products, the main contribution to the improvement in sales came from specialty chemicals A Specialty chemical is a chemical produced for a specialized use. They are produced in lower volume than bulk chemicals, of which petrochemicals, made from oil feedstocks, are the most common. However, both are produced in a chemical plant. and dispersions. Although selling prices continued to decline, we achieved a modest increase in sales of textile and leather chemicals. In the Consumer Products operating sector, business in the third quarter was subdued sub·due tr.v. sub·dued, sub·du·ing, sub·dues 1. To conquer and subjugate; vanquish. See Synonyms at defeat. 2. To quiet or bring under control by physical force or persuasion; make tractable. 3. . Our measures to cut costs and improve earnings were offset by charges arising from special depreciations. In the pharmaceuticals sector, we have made our first move into the generics business; these products will be marketed in Germany by the independent sales and marketing company BASF Generics GmbH. We signed a declaration of intent with the American pharmaceuticals company IVAX IVAX Industrial Vax (Dec Computer) Corp. on a joint venture to produce and market generics in Europe. REGIONS ------- In Western Europe Western Europe The countries of western Europe, especially those that are allied with the United States and Canada in the North Atlantic Treaty Organization (established 1949 and usually known as NATO). and in South/East Asia, with the exception of Japan, our business recorded good rates of growth, which were double digit Noun 1. double digit - a two-digit integer; from 10 to 99 integer, whole number - any of the natural numbers (positive or negative) or zero; "an integer is a number that is not a fraction" in some cases. In Germany, too, we succeeded in making up ground and the figures for the third quarter are better than in the previous year. In North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , plastics and chemicals made the greatest progress, although the improvement in sales was undermined by the fall in dollar parity during the third quarter. In Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. , our companies in Brazil, in particular, achieved good improvements in sales and earnings. PROSPECTS --------- In regard to orders, we expect sales and profit before taxes to remain above the previous year's level in the fourth quarter. We still believe price increases are necessary in many sectors, partly because of further rises in raw materials prices. However, since there is little scope for such increases due to the continuing pressure of competition, further cost cuts are needed. As planned we have cut back our program of capital expenditures by 35 percent. We intend to concentrate on ensuring that the major projects of recent years are converted into market success. -0- SALES OF THE OPERATING DIVISIONS (a) IN THE FIRST-THIRD QUARTERS OF 1994 IN MILLIONS OF DM
Plastics and Fibers (+13.7%): 8,317
Consumer Products (+2.7%): 6,620
Dyestuffs and Finishing Products (+8.3%): 6,152
Chemicals (+17.4%): 4,749
Oil and Gas (-9.9%): 2,983
Products for Agriculture (b) (+10.0%): 2,893
(a) Without petroleum and natural gas taxes (b) Without potash and rock salt operations SALES BY REGIONS (LOCATIONS OF CUSTOMERS) (a) IN THE FIRST-THIRD QUARTERS OF 1994 IN MILLIONS OF DM
Europe (+8.5%) 20,361
Thereof Germany (-0.6%) (8,919)
North America (+2.9%) 6,666
Asia, Australia and
Africa (+11.9%) 3,366
Latin America (+9.0%) 1,976
(a) Without petroleum and natural gas taxes; changes from previous year without potash and rock salt operations. --Ludwigshafen, November 1994 CONTACT: BASF Bernd Gerling, 011 49 621 60 99938 |
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