BASF Raises 2022 Sales, EBIT Outlook -- Update

By Giulia Petroni and Cristina Roca

BASF SE on Wednesday raised its full-year sales and earnings guidance based on a positive performance in the first half and assuming there are no new lockdowns in China or gas production shutdowns in Europe.

The German chemicals company said it now expects sales to grow to between 86 billion and 89 billion euros ($87.4 billion-$90.5 billion), compared with previous expectations of EUR74 billion and EUR77 billion.

Earnings before interest and taxes before special items are seen at between EUR6.8 billion and EUR7.2 billion, from EUR6.6 billion and EUR7.2 billion previously.

The company said it will weigh strategic options for its food and health performance ingredients business, part of its nutrition and health division. "The business has limited portfolio synergies and integration into the BASF Verbund," Chief Financial Officer Hans-Ulrich Engel said during an earnings presentation. BASF Verbund plants combine different functions in one site.

BASF confirmed preliminary second-quarter figures, including an increase in net profit and sales. It said Wednesday that the good momentum it experienced during the quarter continued in July.

However, it warned that the war in Ukraine and its impact on energy and raw-material prices may lead to additional headwinds, while further risks could arise from Covid-19-related restrictions.

"For the second half of the year, BASF anticipates a gradual cooling of economic development globally, but much more pronounced in Europe," the group said.

BASF said it is responding to the economic slowdown with cost-reduction measures.

Write to Giulia Petroni at [e-mail] and Cristina Roca at [e-mail]

(END) Dow Jones Newswires

July 27, 2022 03:53 ET (07:53 GMT)

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