Preliminary figures released by BASF SE suggest that sales dropped by a quarter in the second quarter of 2023. This was below average analyst expectations of 19.4 milion euros ($21.7 million)
The fall, from 23 million euros ($25.7 million) in the same quarter in 2022 to 17.3 million euros ($19.3 million) this year, was attributed to considerably lower prices and volumes. Negative currency effects also contributed.
Net income was also in line with expectations, at 499 million euros, ($558 million) down from 2.1 billion euros ($2.3 billion) in the 2022 quarter. This was below the 729 million euros ($816 million) expected by the analyst community.
As a result, the company has cut its full-year estimated sales from 84-87 billion euros ($94-98 billion) to 73-76 billion euros ($81-85 billion).
Although global gross domestic product numbers were up in the first half of the year, the company said, this was driven by the service sector, and global industrial production continued to slow, having a noticeable knock-on effect on chemicals production.
While it does not anticipate further weakening in global demand because of the customer destocking that has already taken place, it still expects demand for consumer goods to be lower than previously expected. Margins will remain under pressure.
The company’s full half year results will be published on July 28.