BASF with Solid Start to the Year in 1Q 2024

BASF got off to a solid start in the first quarter of 2024.

Sales in the first quarter of 2024 amounted to €17.6 billion, €2.4 billion below the figure of the prior-year quarter. This decline in sales was mainly driven by considerably reduced prices as a result of lower raw materials and energy prices in almost all segments as well as lower precious metal prices in the Surface Technologies segment.

Negative currency effects contributed to the sales decrease in all segments. Considerable growth in sales volumes in the Chemicals, Materials, Nutrition & Care and Industrial Solutions segments had a positive impact on sales. This more than compensated for lower volumes in the Agricultural Solutions and Surface Technologies segments.

Income from operations before depreciation, amortization and special items (EBITDA before special items) amounted to €2.7 billion, 5.7 percent higher than the average of analysts’ estimates. Compared with the first quarter of 2023, EBITDA before special items decreased by €153 million or 5.3 percent.

The Nutrition & Care, Materials, Industrial Solutions and Chemicals segments increased EBITDA before special items, in some cases significantly, mainly due to reduced fixed costs as well as predominantly volume-related higher contribution margins.

Despite these earnings increases, the BASF Group’s EBITDA before special items declined slightly, in particular due to the considerable decline in earnings of Other, which was primarily attributable to higher bonus provisions. The Agricultural Solutions and Surface Technologies segments also recorded lower EBITDA before special items than in the first quarter of 2023.

EBITDA amounted to €2.7 billion compared with €2.8 billion in the prior-year period. The EBITDA margin before special items was 15.4 percent, up from 14.3 percent in the prior-year quarter. At €1.7 billion, EBIT was €177 million below the figure of the prior-year quarter.

Cash flows from operating activities amounted to minus €0.5 billion, compared with minus €1.0 billion in the prior-year quarter. The improvement was primarily due to lower cash outflow from net working capital. Free cash flow, which was negatively impacted by the typical seasonal increase in receivables in the Agricultural Solutions segment, improved to minus €1.5 billion in the first quarter of 2024 compared with minus €1.9 billion in the prior-year quarter.