BASF SE, the world's largest chemical company, has reported first quarter sales down 29 percent, with sales hit by low oil prices and the absence of a contribution from its gas trading and storage activities, after last year's asset swap with Russia's Gazprom.
Sales for the first three months of 2016 came in at 14.2 billion euros ($16.2 billion), down 29 percent, while earnings before interest and tax and before special items were 8 percent lower at 1.9 billion euros ($2.1 billion).
The now-absent gas trading and storage business had contributed 4.2 billion euros ($4.8 billion) to BASF's first quarter numbers last year, it said.
Elsewhere the depressed oil price had hit sales prices in its chemicals business, although overall volumes had matched those of the same period last year.
Volumes had increased “slightly” in its functional materials and solutions operation, its oil and gas and performance products segments, and had decreased slightly in agricultural solutions and chemicals operations.
Kurt Bock, BASF chairman, said there had been a slight increase in EBIT before special items in all but the oil and gas and chemicals divisions.
Earnings per share rose 18 percent year-on-year, while BASF announced a proposed dividend for 2015 of 2.90 euros ($3.31), up 3.6 percent.
Assessing the rest of the year, Bock said the firm aimed to increase sales volumes but warned that group sales – in revenue terms – would “decline considerably…as a result of the divestiture of the gas trading and storage business as well as lower oil and gas prices”.
Bock said EBIT before special items for 2016 would be “slightly below” last year's figure of 6.7 billion euros ($7.6 billion).
“This is an ambitious goal in the current volatile and challenging environment, and is particularly dependent on oil price developments,” he added.
Bock said the group would continue to fine-tune its operations throughout the year after a number of recent disposals, and aimed to focus on high-growth businesses.
