BASF remains confident
Despite signs of weakening growth in the chemical industry, German chemicals firm BASF has confirmed its outlook for 2008 at an analyst conference held in London. It company has revised its expectations for growth in global chemical production from 2.8% to 2.4%.
“I am confident that BASF will achieve its goals for 2008 despite the rise in oil prices and the associated significant increase in raw material prices,” said chairman, Dr Jürgen Hambrecht. “Assuming that there are no changes to BASF’s portfolio, we aim to increase sales and to improve EBIT before special items slightly in 2008.”
The firm also presented long-term aims: for the next five years, the group aims to achieve an EBITDA margin of 18% reliant on an unchanged portfolio, an oil price of $100 per barrel and an exchange rate of $1.40 to $1.50 per euro. For the same period, it aims to post average volume growth two percentage points above the chemical market.
Dr Hambrecht pointed out that specialty products, which are faster growing than commodities, now account for 63% of sales (excluding oil & gas and precious metals trading) compared with 54% in 2003. As a result, it is now in a better position to deal with economic fluctuations than in the past. The firm’s acquisitions of Engelhard, Degussa Construction Chemicals and Johnson Polymer in 2006 have contributed substantially to this development.
