BASF Group's sales growth and year-on-year revenue decline were in agreement with expectations

First quarter 2019:
sales of EUR 16.2 billion (up 3%)
ERU before special items eur 1.7 billion (down 24%)
Decrease mainly due to lower contributions in the Materials and Chemicals business area
Strong earnings performance in the Agricultural Solutions business
2019 Outlook:
sales slightly up
EFA earnings before special items slightly higher than a year earlier
Dr. Dr. Bo, Chairman of BASF's European Executive Board Martin Brudermueller announced at the company's annual general meeting at the Rose Garden Convention Center in Mannheim, Germany: "In the first quarter of 2019, BASF Group sales increased by 3% year-on-year to EUR 16.2 billion. "Earnings before interest and tax, net of special items, decreased by EUR 549 million to EUR 1.7 billion compared to the first quarter of 2018. "As expected, this is mainly due to the impact of reduced contributions in the materials and chemicals business areas,"

. Last year we achieved good results due to the high profitability of isocyanate and the excellent profit performance of the cracking device products. "Earnings before interest and tax, net of special items, also declined significantly in the Nutrition and Care and "Other" business areas, while earnings in the surface treatment technology business were essentially flat compared to the same period last year. Revenue in the Agricultural Solutions and Industrial Solutions business increased significantly from the same period last year.
the global economy in the first quarter of 2019 will be affected by geopolitical and trade conflicts, particularly between China and the United States. This has affected market sentiment and put many customers on the sidelines, resulting in the BASF Group being affected by weakening demand in key customer sectors, particularly in the automotive sector.
prices of these products decreased by 2% compared with the same period last year, mainly due to isocyanate and cracking device products business. Higher prices for products in the surface treatment technology, agricultural solutions and industrial solutions businesses only partially offset the expected price declines from the Materials and Chemicals business. BASF Group sales fell 4 per cent as a result of overall prudent ordering behaviour by customers. The increase in sales was mainly due to the portfolio effect of the acquisition of Bayer's business and assets by the Agricultural Solutions division in August 2018. Exchange rate factors have also had a positive impact on overall sales across business areas.
special items in the first quarter of 2019 were EUR 26 million, compared with EUR 18 million in the same period last year. Special revenues from divestitures in the Agricultural Solutions and Industrial Solutions business areas exceed consolidation costs, special charges for restructuring measures, and other costs.
earnings before interest and tax fell by 505 million euros to 1.8 billion euros from the same period in 2018. Pre-tax revenues fell by 520 million euros to 1.6 billion euros. The tax rate increased from 24.1 per cent to 25.4 per cent.
after-tax income from continuing operating activities decreased by EUR 415 million to EUR 1.2 billion. After-tax income from terminated operations, including oil and gas operations, increased by Euro97 million to Euro274 million. This was mainly due to a significant increase in sales, particularly in the Russian market, as well as the depreciation and amortization charges that have been suspended since the group's divestiture in the third quarter of 2018.
net income fell by 273 million euros to 1.4 billion euros. Earnings per share were EUR 1.53 in the first quarter of 2019 (Q1 2018: EUR 1.83). Adjusted for amortization of special items and intangible assets, EUR 1.65 (Q1 2018: EUR 1.93).
cash flow from operating activities in the first quarter of 2019 was EUR 373 million, a decrease of EUR 858 million from the same period in 2018. Free cash flow fell to minus 368 million euros from 604 million euros a year earlier, mainly due to lower cash flow from operating activities.
the merger of Wintershall and DEA
was approved by the relevant authorities, BASF and Letter One completed the merger of Wintershall and DEA on 1 May 2019. "Wintershall Dea will be a leading independent European exploration and production company with international operations in its core region," Dr. Hans-Ulrich Engel, Executive Vice Chairman of BASF Europe, said on the first quarter 2019 results conference call. By merging two German companies, BASF and LetterOne laid the groundwork for further earnings growth at Wintershall Dea. The
dividend of EUR 3.20
the Executive Board and the Supervisory Board proposed to the annual general meeting of shareholders an increase of EUR 0.10 to EUR 3.20 per share. "Based on the share price of 60.40 euros at the end of 2018, BASF shares have a dividend yield of 5.3 per cent," Mr Bo said. BASF will pay a total of 2.9 billion euros to shareholders on May 8th, after the resolution was adopted at the annual general meeting.
2019 forecast
BASF's overall forecast for the global economic environment for 2019 remains unchanged:
GDP growth: 2.8%
Industrial production growth: 2.7%
Chemical production growth: 2.7%
average euro to US dollar exchange rate: 1 euro to $1.15
Average crude oil price (Brent): $70 per barrel
BASF confirmed the Group's 2018 report forecast for 2019 sales and earnings, and expects both sales and earnings before interest and tax on special items to increase slightly, in the low range of 1% to 10%. Return on Capital (ROCE) is expected to be slightly higher than the cost-of-capital ratio, but will be lower than in 2018.
business performance in all business areas

including the Petrochemicals and Intermediates business unit, was EUR 2.5 billion in the first quarter of 2019, down 13% from the first quarter of 2018. Among them, sales in the petrochemicals business decreased significantly, and sales in the intermediates business decreased slightly. The main reason for the change in sales in the two business units was lower sales volume and price.
earnings before interest and tax on special items fell by 169 million euros to 306 million euros compared with the same period last year. Profits declined in both divisions, particularly the Petrochemicals division. This was mainly due to lower profits in the petrochemicals division, including the steam cracking product business, and lower sales in both divisions. In addition, fixed costs increased slightly in both business units: in the Petrochemicals division, higher maintenance costs were the main cause, while fixed costs in the Intermediates division were due to monetary factors.
materials business unit
sales of EUR 2.9 billion, down 15% from the same period last year. Sales declined in both divisions, but were mainly due to lower isocyanate prices in the monosyl unit.
earnings before interest and tax on special items fell sharply in both business units to 323 million euros, compared with 816 million euros a year earlier. This is mainly due to the lower price of isocyanate in the monosyl unit. Higher profits in the Characteristic Materials business failed to offset the negative impact of lower sales, mainly from the automotive industry. In addition, the fixed costs of the two business units were slightly higher than in the same period last year, mainly due to exchange rate factors.
industrial solutions business area
, including the Dispersion and Pigments and Characteristics Chemicals division, had sales of EUR 2.2 billion, down 2% from the same period last year. Within this total, sales in the Dispersion and Pigments division were flat in the first quarter of 2018, while sales in the Characteristic Chemicals division decreased slightly year-on-year. This is mainly due to the fact that BASF's paper and water treatment chemicals business has been transferred to the Solenis Group, which was previously attributable to the Characteristic Chemicals business.
, earnings before interest and tax on non-special projects in the Industrial Solutions business increased 15% year-on-year to EUR 264 million compared to the first quarter of 2018. Earnings before interest and tax, net of special items, increased earnings before special items were significantly higher as a result of price increases, sales growth and positive exchange rate factors. The small increase in EST earnings, net of special items, in the Dispersion and Pigments business was mainly due to the positive impact of higher prices and exchange rate factors. ETI income from the Characteristic Chemicals business includes special income from the transfer of BASF's paper and water treatment chemicals business to the Solenis Group.
sales in the
surface treatment technology business, including the Catalysts, Coatings and Chemical Building Materials division, increased 13 percent to
EUR 3.6 billion compared to the first quarter of 2018. Among them, the Catalyst business unit's sales growth was particularly strong. Sales in the Chemical Building Materials division also increased significantly, with the Coatings division remaining essentially flat compared to the same period last year. The increase in sales was mainly due to higher prices in all relevant business units, a positive impact from exchange rate factors, and sales growth in the Catalysts and Chemical Building Materials business unit.
earnings before interest and tax on special items in the business area were 159 million euros, essentially flat compared with the same period last year. The Chemical Building Materials business unit's earnings before interest and tax on special items increased significantly, mainly due to higher profits. The Catalysts division's revenue rose slightly as sales increased. In contrast, the coatings division's significant decrease in EST earnings, net of special items, was mainly due to weakness in the automotive industry.
sales in the nutrition and care business
, including the Care Chemicals and Nutrition and Health business, were EUR 1.6 billion, the same as the same period last year. The significant increase in sales in the Nutrition and Health business was offset by a slight decrease in sales in the Care Chemicals division.
earnings before interest and tax on special items were EUR 222 million, down 13% yoY from EUR 254 million in the first quarter of 2018. The Nutrition and Health division received insurance payouts in the first quarter of last year as a result of the 2017 outage, resulting in a year-on-year increase in fixed costs for the division. In addition, the decline in profits in the animal nutrition business resulted in a significant overall decline in revenue for the Nutrition and Health business. Revenue from the Care Chemicals division increased significantly, mainly as a result of higher profits, partially offsetting the negative impact.
agricultural solutions business, sales
2.6 billion euros, up 53% year-on-year. This is mainly due to the portfolio effect of BASF's acquisition of Bayer's key businesses and assets in August 2018. BASF's original business also achieved price increases, but sales fell sharply year-on-year due to weather conditions.
earnings before interest and tax on special items amounted to EUR 740 million, up 75% year-on-year, mainly due to the acquisition business. Earnings before interest and tax include special income from divestitures from bayer-related businesses under conditions set by antitrust authorities. In the first quarter of 2019, related special revenue exceeded special expenses for consolidated acquisitions.
year-on-year, sales
other
business areas increased significantly. This is mainly due to the non-transfer of the portion of BASF's paper and water treatment chemicals business to Solenis that is now included in the "other" report. EST earnings, which do not include special items, declined significantly compared to the first quarter of 2018, mainly due to exchange rate factors and valuation effects of long-term incentive plans. about BASF
at BASF, we create a new role in chemistry - the pursuit of a sustainable future. We combine economic success, social responsibility and environmental protection. WITH approximately 122,000 employees worldwide, BASF contributes to the success of customers in almost all countries and industries. Our products are divided into six business areas: chemicals, materials, industrial solutions, surface treatment technology, nutrition and care, agricultural solutions. BASF's global sales in 2018 will be approximately EUR 63 billion. BASF's shares are listed on the Frankfurt (BAS) Stock Exchange and traded on the U.S. stock market in the form of American Deposit receipts (BASFY). For more information, please visit:

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