Chemical company
BASF sees itself prepared for US tariffs and looks at Asia
In Europe and North America, the chemical giant only expects weak growth. This also affects the Ludwigshafen main plant. BASF boss Kamieth sees risks in the US tariffs-and relies on Asia.
The world’s largest chemical company BASF is prepared for the customs policy of US President Donald Trump. The tariffs provided uncertainty in industry and the markets, said CEO Markus Kamieth at the online general meeting of the DAX group. “But BASF is prepared.”
The group is active in all important regions and produces on site for local markets. “This has always been an advantage for BASF. But especially in these times,” emphasized the manager, who took over the helm a year ago at the Ludwigshafen Dax group.
BASF produces in the USA
“We achieve more than 80 percent of our sales in the United States with products that we manufacture there,” said Kamieth. In Asia, the proportion is similarly high – even higher in Europe. Nevertheless, the effects of US customs policy on demand and global trade flows are currently difficult to estimate.
Kamieth called Asia as the market of the future for BASF. “Growth driver for chemistry is and remains Asia.” The focus is on China: “We want to continue growing in China. Our new composite location in Zhanjiang is the basis for this.”
Asia strong in view – despite criticism
BASF is investing billions of billions in Zhanjiang in the South Chinese province of Guangdong. Critics have long warned that the group is making itself depending on an autocratic regime after expensive depreciation in Russia. At the Annual General Meeting, shareholder protectors also warned of a strong dependence on China.
Weak growth in Europe and North America is expected
In addition to China, the chemical company India, Indonesia, Malaysia, Singapore, Thailand and Vietnam take a look at, said Kamieth. “By 2035, these seven countries stand for around 80 percent of global chemical memory.” In Europe and North America, on the other hand, the company only expects weak to moderate growth for the chemical industry. In these markets, BASF focuses on loading existing capacities.
The chemical giant runs billions in savings programs. The Ludwigshafen main plant in particular should become more profitable and more competitive. The CEO assured the shareholders that the location will remain a strong pillar and a leading and sustainable location in the group. The austerity programs would go well.
First quarter weaker – outlook unchanged
At the start of the current year, BASF had to book declines in sales and profits. In the first quarter, revenues decreased slightly by 0.9 percent to 17.4 billion euros. The operational profit, which was adjusted for special items before interest, taxes and depreciation (adjusted EBITDA), fell by 3.2 percent to 2.6 billion euros.
The bottom line was a profit of 808 million euros, after almost 1.4 billion a year earlier. Management confirmed the goals for 2025: a value of 8.0 billion to 8.4 billion euros is sought in the result of interest, taxes and depreciation (EBITDA) and special influences. The BASF management did not provide a forecast of sales and profits after taxes.
BASF has set itself the goal of saving 2.1 billion euros a year by the end of 2026. Due to the austerity course, the dividend for shareholders is also lower: a dividend of 2.25 euros per share was decided at the general meeting. For 2023, BASF had paid 3.40 euros per share.
No decision on future general meetings
Kamieth and the chairman of the supervisory board Kurt Bock announced that BASF will decide year after year whether the general meeting will take place in presence or online. He could imagine an alternating format, said Kamieth.
dpa
Source: Stern
