BASF Group has recorded significant sales and earnings growth in its Chemicals, Functional Materials and Solutions and Oil and Gas businesses in 3Q17.
Sales in the compnay’s Chemicals segment rose by 25% compared with the prior-year quarter, to approximately €4 billion. This was largely due to higher prices in all divisions, especially in monomers. BASF also significantly increased sales volumes. Currency effects slightly dampened sales in all divisions. EBIT before special items rose by over €600 million to €1.1 billion, primarily due to higher margins, especially in the monomers division. The negative impact on earnings in 3Q17 caused by the North Harbor accident at the Ludwigshafen site was compensated by insurance payments. Fixed costs rose slightly.
Sales in BASF’s Functional Materials and Solutions segment were up 7% on 3Q16, at around €5 billion. This was attributable to higher prices as well as the Chemetall business, which was acquired from Albemarle in December 2016. Sales volumes rose in every division except Catalysts, where BASF posted a considerable decline in precious metal trading volumes. Compared with 3Q16, sales volumes to the automotive and construction industries were further expanded. Sales were slightly weighed down by currency effects. At €397 million, EBIT before special items was down €100 million on the prior-year quarter. Earnings were dampened primarily by lower margins resulting from higher raw materials prices.
Sales in the company’s oil and gas segment rose by 20% year-on-year to €739 million on the back of higher prices and volumes. The average price of a barrel of Brent blend crude oil in 3Q17 was US$52 (prior-year quarter: US$46). Gas prices on the European spot markets also rose compared with the prior-year quarter. Volumes growth was mainly driven by higher gas sales volumes. Production volumes also increased slightly. EBIT before special items decreased by €14 million to €180 million. The prior-year figure included compensation payments from contract renegotiations. Net income nevertheless grew considerably, from €33 million to €139 million. This was mainly due to special income from the sale of shares in a natural gas field concession in Argentina.
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