Admin I Friday, July 28, 2023
BERLIN – German chemical company BASF suffered a drop in income in the second quarter, falling to to €499 million ($547 million) compared to last year’s €2.1 billion.
Income from operations (EBIT) before special items of €1.0 billion in the second quarter of 2023 was €1.3 billion below the figure of the prior-year period, according to results reported on Friday.
Group sales for the second quarter of 2023 declined 24.7% year-over-year to €17.3 billion.
As announced at the end of February, the company is executing a cost savings program with a focus on Europe and is adapting its Verbund, or value chain structures, in Ludwigshafen, Germany, BASF said in a statement.
The company said it will reduce fixed costs by the end of 2026 so that they will then be around €1 billion lower annually. By the end of 2023, BASF expects to achieve annual savings of more than €300 million from the cost savings program.
The company noted that it does not expect a further weakening in demand at the global level for the second half of 2023, as the inventories of chemical raw materials in most customer industries have already been greatly reduced.
Earlier this month, BASF had adjusted its outlook for 2023. The company said on July 12 that it anticipated sales to be between €73 billion and €76 billio in 2023 compared to previous outlook of €84 billion to €87 billion.
