The chemical giant BASF wants to concentrate more on its core business. This has consequences for individual divisions.
The world’s largest chemical company, BASF, wants to take its agricultural division public. This was announced by CEO Markus Kamieth at the presentation of the DAX group’s new strategy in Ludwigshafen. The business is to be spun off into separate companies by 2027. The conditions will then be created to take a minority share in the division public in the medium term.
In the coming years, the chemical company will focus on strengthening its core businesses and growing profitably, explained Kamieth. Through corporate restructuring, cost-cutting measures and lower investments, operating profit is expected to increase significantly in the medium term. Earnings before interest, taxes, depreciation and amortization (EBITDA) adjusted for special items are expected to be between ten and twelve billion euros in 2028. In 2023, BASF earned almost 7.7 billion euros from operations, almost 29 percent less than in the previous year.
However, the chemical company BASF will probably not be able to pay as much dividend as in previous years. The direct profit participation should be at least 2.25 euros per share in the coming years, the DAX group announced. BASF had paid 3.40 euros per share for 2023.
The annual dividend amount in the coming years will be around two billion euros, it said. Between 2025 and 2028, a total of around eight billion will be distributed. This will be supplemented by share buybacks. These are planned for 2027 at the latest and are expected to amount to around four billion euros.
BASF is suffering from cost pressure and high energy prices. As a result, the DAX-listed company launched another billion-dollar savings program in February, including job cuts and the closure of plants. In particular, the main plant in Ludwigshafen, the group’s largest production site, is to be restructured to increase profitability. According to the latest savings program, an additional annual cost saving of one billion euros is to be made here by the end of 2026. It is still unclear how many jobs will be lost in Ludwigshafen.
Source: Stern
