Annual profits miss targets at BASF

(Sharecast News) - German chemical giant BASF Group reported annual sales and earnings well below analyst expectations on Friday. Releasing preliminary figures for 2023, BASF said annual sales were €68.9bn, below both internal and external forecasts for €73bn to €76bn. Sales in 2022 were €87.3bn.

Expected income from operations before special items fell from €6.9bn to €3.8bn, less than the €4bn to €4.4bn expected. BASF said the decrease was due to "sales-related lower margins, which could not be offset by the achieved fixed cost reduction".

Net income, however, was €225m, a notable improvement on 2022's net loss of €627m, when the firm was hit by non-cash impairments relating to its exit from Russia.

BASF's energy intensive operations have left it grappling with higher costs and falling earnings. Demand has also softened.

Last year it launched a major cost cutting programme, and in December announced that Markus Kamieth would take over as chief executive from outgoing incumbent Martin Brudermuller in April.

Kamieth currently oversees BASF's China operations, a key market for the company.

BASF, the world's largest chemicals company, will publish final full-year figures on 23 February.