LUDWIGSHAFEN, Germany – BASF has announced that its third-quarter sales increased by two percent compared with the second quarter but fell 19 percent compared with the same period in 2008. Income from operations (EBIT) before special items was nine percent higher than in the second quarter and 20 percent lower than in the third quarter of 2008. All operating divisions contributed positive earnings. BASF’s strong cash flow increased the company’s financial strength and has enabled it to reduce debt.
“In this unprecedented downturn, we have demonstrated decisive action in the form of strict crisis management, tailoring production to demand, idling plants and introducing flexible working time arrangements,” said BASF Chairman Jürgen Hambrecht during his presentation of the company’s third-quarter results. “In the past three months, our business has stabilized at a low level. Positive impulses are coming from Asia, especially from China, and from parts of South America. Europe and North America remain weak.”
BASF believes that destocking by its customers worldwide appears to be over for the time being. This has caused a slight upturn in demand. However, customers are still placing smaller orders at increasingly short notice, especially closer to the end of the year.
Despite stabilization of the economic environment in the third quarter, BASF anticipates a significant decline in sales and earnings for full year 2009. Fourth-quarter income from operations before special items is likely to be higher than in the weak fourth quarter of 2008 but lower than in the third quarter of this year.