BASF expects unchanged operating profit in 2015
BASF, the world’s largest chemical firm by sales, saw increased profits in 2014 but doesn’t expect the same in 2015.
The Germany-based company reported that its net profit in 2014 grew by 7.6 per cent to 5.1 billion euros (US$5.8 billion) in line with its earnings targets for the year. Operating profit was up 6.5 per cent at 7.6 billion euros, while sales edged 0.5 per cent higher to 74.3 billion euros.
“We grew profitably,” said BASF Chief Executive Kurt Bock. “We further strengthened our chemicals business and in turn improved our margins.” In the fourth quarter, Bock added, the result was significantly boosted by the sale of its half of the Styrolution joint venture. Its partner, UK-based Ineos, bought out BASF with 1.1 billion euros.
But BASF expects operating profit to stagnate this year due to lower oil prices and the cost of launching an unusually high number of production sites.
The company, whose products include car coatings, foam chemicals, catalytic converters and mining chemicals, said the prospects of somewhat stronger global economic growth this year were nevertheless uncertain.
“Oil and raw material prices are volatile, as are currencies. The emerging markets are growing more slowly and the global economy is being dampened by geopolitical conflict,” BASF said in a statement after releasing fourth-quarter results.