German chemical giant, BASF SE, has announced a 1 percent growth in sales for the second quarter of 2014 compared to the same period in 2013, reporting sales of 18.5 billion euros ($24.9 billion).
“This was largely the result of higher sales volumes in our chemicals business, which comprises the chemicals, performance products and functional materials & solutions segments, as well as in the oil & gas segment,” said Kurt Bock, chairman of the board of executive directors at the half-year earnings telephone conference.
Earnings before taxes increased by 246 million euros ($331.3 million) to 2 billion euros ($2.6 billion) compared with the previous second quarter, with share earnings rising from 1.26 euros ($1.69) to 1.41 euros ($1.89).
Sales at BASF companies with locations in Europe rose by 1 percent in the second quarter compared with the same quarter of the previous year.
Sales matched the previous second-quarter level in the functional materials & solutions business which includes the performance materials division consisting of polyurethanes, thermoplastics, foams and epoxy resins. Sales volumes increased considerably, primarily in the catalysts division. EBIT before special items for functional materials & solutions increased by 63 million euros ($84.8 million) to 356 million euros ($479.5 million). The company states this was largely owing to higher volumes and reduced fixed costs.
BASF recently inaugurated a new production plant for mobile emissions catalysts in Środa Śląska near Wrocław, Poland. The company also says it is increasing investments in plastics and plastic precursors business in Asia.
For 2014, BASF now expects weaker growth in the global economy than was predicted six months ago, now 2.5 percent instead of 2.8 percent. It states sales are likely to decrease slightly compared with 2013, due to the divestiture of the gas trading and storage business, as well as to continuing negative currency effects.