BASF Weathers Auto Slump With Better-Than-Expected Earnings
(Bloomberg) -- BASF SE gave an early glimpse of second-quarter operating results that it says were better than investors expected despite the steep slump in demand from auto companies, its most important customer industry.
Earnings before interest, taxes and some items for the period will be about 226 million euros ($255 million), the world’s biggest chemical maker said in a statement. That’s better than analysts’ average estimate for 146 million euros, according to a consensus compiled by the company.
BASF’s net loss will be worse than market expectations mainly because of a roughly 800 million-euro impairment at its Wintershall-DEA subsidiary related to slumping oil and gas prices.
Europe’s auto industry is facing a historic slump with sales expected to contract a record 25% this year. At BASF, demand from industries including nutrition and personal care are helping soften the blow, as is stable profit in its agricultural products business.
BASF’s stock reversed earlier losses and traded 0.1% higher at 49.67 euros as of 4 p.m. Friday in Frankfurt. It is down 26% this year, for a market value of 46 billion euros. The company will publish a full set of second-quarter figures on July 29.
Revenue in the three months through June fell about 12% to 12.7 billion euros, BASF said, beating the average estimate for 11.8 billion euros.
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