6-K UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
April 26, 2007
BASF AKTIENGESELLSCHAFT
(Exact name of Registrant as Specified in its Charter)
BASF CORPORATION
(Translation of Registrant's name into English)
Carl-Bosch-Strasse 38, LUDWIGSHAFEN, GERMANY 67056
(Address of Principal Executive Offices)
Indicate by check mark whether the
Registrant files or will file
annual reports under cover Form
20-F or Form 40-F
Form 20-F X Form 40-F
Indicate by check mark whether the Registrant by
furnishing the information contained in this Form
is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes No X
If "Yes" is marked, indicate below the file number assigned to the
Registrant in connection with Rule 12g3-2(b): 82- .
BASF Presents First-Quarter Results at 55th Annual Meeting
Powerful start to 2007
-- Further increase in sales (plus 17 percent) and EBIT before
special items (plus 13 percent)
-- Earnings jump (plus 98 percent) in Chemicals segment
-- Positive outlook for 2007 confirmed:
Significant increase in sales and EBIT before special items to
at least match the previous year's strong level
LUDWIGSHAFEN, Germany--(BUSINESS WIRE)--April 26, 2007--BASF
(NYSE:BF)(FWB:BAS)(LSE:BFA) remained on its successful course in the
first quarter of 2007 and looked confidently to the coming months
following a powerful start to the year. "BASF's team is working
constantly to bring the company even closer to its customers and make
BASF even more innovative and cyclically resilient," said BASF's
Chairman Dr. Jurgen Hambrecht during the presentation of the company's
results for 2006 and the first quarter of 2007 at the 55th Annual
Meeting in Mannheim on April 26, 2007.
Compared with the same period of 2006, sales in the first quarter
rose 17 percent to EUR 14.6 billion. This was due primarily to the
acquisitions in 2006, as well as higher volumes and sales prices in
the chemical businesses. Disregarding currency effects, in particular
from the depreciation of the U.S. dollar, sales increased by
21 percent.
Compared with the very strong first quarter of 2006, BASF
increased income from operations (EBIT) before special items by
13 percent to EUR 2.1 billion. Earnings in the Chemicals segment
almost doubled, and were significantly higher in all divisions.
Margins improved, in particular for petrochemicals. The Catalysts
division also made a major contribution to the earnings growth. In the
Plastics segment, earnings declined slightly because the Polyurethanes
division did not quite match the strong performance of the previous
year's first quarter. Earnings improved in the Styrenics business due
to the expansion of the business and improved efficiency. Earnings in
the Performance Products segment were lower than in the first quarter
of 2006 as a result of persistent pressure on margins for functional
polymers. Both divisions in the Agricultural Products & Nutrition
segment posted higher earnings. The earnings situation in Brazil
improved in the Agricultural Products division. In the Fine Chemicals
division, earnings increased as a result of the restructuring measures
initiated in 2006 and the contribution from the acquired personal care
business. In the Oil & Gas segment, a rise in the contribution from
the natural gas trading business kept earnings at the previous year's
strong level despite the decline in oil prices.
Compared with the same period of 2006, first-quarter EBIT after
special items rose by 9 percent to approximately EUR 2 billion.
Special items in income from operations were related to integration
costs for the acquisitions made in 2006 and expenses for
restructuring.
The financial result declined by EUR 115 million to minus EUR
94 million. Interest expenses rose in connection with financing for
the acquisitions made in mid-2006. The previous year's first quarter
contained proceeds from the sale of securities.
Income before taxes and minority interests rose by 2 percent to
EUR 1.9 billion. The tax rate declined from 46 percent to 40 percent
as a result of the acquisitions and the lower contribution to the BASF
Group's earnings from the Oil & Gas segment. In the first quarter,
foreign taxes for oil production that are noncompensable with German
corporate income tax amounted to EUR 258 million compared with EUR
272 million in the same period of 2006.
Net income rose by 9 percent to more than EUR 1 billion. Earnings
per share were EUR 2.08 compared with EUR 1.87 in the first quarter of
2006.
Positive outlook confirmed for full-year 2007
Hambrecht remained confident with regard to the ongoing year,
expecting global economic growth of 3.2 percent. In 2007, the company
anticipates an average oil price (Brent) of about $55/barrel and an
average euro/dollar exchange rate of $1.30 per euro. Major risk
factors are seen as being associated with an escalation in
geopolitical trouble spots.
"The good start in the first quarter confirms our positive outlook
for 2007. We expect significantly higher sales based on the
acquisitions made in 2006 and organic growth. We expect to at least
match the previous year's strong EBIT before special items despite our
assumption of a lower average oil price in 2007," said Hambrecht.
Double-digit sales growth in all regions
Sales by location of company in Europe increased by 14 percent in
the first quarter of 2007. EBIT before special items rose by EUR
171 million to EUR 1.6 billion. This was due both to the acquired
businesses and organic growth in the chemical businesses. Earnings in
the Oil & Gas segment matched the previous year's level despite the
decline in oil prices.
As a result of the acquisitions, companies in North America
increased sales by 23 percent in dollar terms and by 15 percent in
euro terms. EBIT before special items declined by EUR 33 million to
EUR 265 million. Earnings were reduced by the shutdown of the TDI
plant in Geismar, Louisiana, as well as by weaker demand from the
automotive industry. This could not be fully offset by the acquired
businesses.
In Asia Pacific, BASF increased sales by 37 percent in local
currency terms and by 28 percent in euro terms. EBIT before special
items climbed EUR 92 million to EUR 207 million. The sales and
earnings growth was due to the acquisitions as well as strong demand
for products from the Chemicals and Plastics segments. The measures to
increase efficiency that were initiated in 2006 also contributed to
the rise in earnings.
In South America, Africa, Middle East, first-quarter sales by
location of company rose by 49 percent in local currency terms and by
41 percent in euro terms. EBIT before special items increased by EUR
21 million to EUR 53 million. The activities of the Catalysts division
in South Africa and the Agricultural Products division in South
America contributed to the expansion of the business. Higher prices
for agricultural produce improved the economic situation for farmers
in Brazil, thus increasing demand for crop protection products.
BASF is the world's leading chemical company: The Chemical
Company. Its portfolio ranges from chemicals, plastics, performance
products, agricultural products and fine chemicals to crude oil and
natural gas. As a reliable partner to virtually all industries, BASF's
high-value products and intelligent system solutions help its
customers to be more successful. BASF develops new technologies and
uses them to meet the challenges of the future and open up additional
market opportunities. It combines economic success with environmental
protection and social responsibility, thus contributing to a better
future. BASF has approximately 95,000 employees and posted sales of
EUR 52.6 billion in 2006. BASF shares are traded on the stock
exchanges in Frankfurt (BAS), London (BFA), New York (BF) and Zurich
(AN). Further information on BASF is available on the Internet at
www.basf.com.
On April 26, 2007, you can obtain further information from the
Internet at the following addresses:
Interim Report (from 7:30 a.m. CEST)
corporate.basf.com/interimreport (English)
corporate.basf.com/zwischenbericht (German)
Press release (from 7:30 a.m. CEST)
corporate.basf.com/pressrelease (English)
corporate.basf.com/pressemitteilungen (German)
Live Transmission-Telephone Conference for Analysts
(from 8:30 a.m. CEST)
corporate.basf.com/share (English)
corporate.basf.com/aktie (German)
Live Transmission - Speech Dr. Jurgen Hambrecht
(from 10:00 a.m. CEST)
corporate.basf.com/shareholdermeeting (English)
corporate.basf.com/hauptversammlung (German)
Speech Dr. Jurgen Hambrecht - print version
(from 11:30 a.m. CEST)
corporate.basf.com/pcon (English)
corporate.basf.com/pk (German)
Photos (from 7:30 a.m. CEST)
corporate.basf.com/photos (English)
corporate.basf.com/fotos (German)
Photos from the Annual Meeting
(from 1:00 p.m. CEST)
corporate.basf.com/photos (English)
corporate.basf.com/fotos (German)
Information about BASF shares
corporate.basf.com/share (English)
corporate.basf.com/aktie (German)
Forward-looking statements
This release contains forward-looking statements under the U.S.
Private Securities Litigation Reform Act of 1995. These statements are
based on current expectations, estimates and projections of BASF
management and currently available information. They are not
guarantees of future performance, involve certain risks and
uncertainties that are difficult to predict and are based upon
assumptions as to future events that may not prove to be accurate.
Many factors could cause the actual results, performance or
achievements of BASF to be materially different from those that may be
expressed or implied by such statements. Such factors include those
discussed in BASF's Form 20-F filed with the Securities and Exchange
Commission. We do not assume any obligation to update the
forward-looking statements contained in this release.
Powerful Start to 2007
First-Quarter
Results 2007
January - March 2007
Published on April 26, 2007
BASF Group First-Quarter Results 2007
Overview
1st Quarter
Million EUR Change
2007 2006 in %
Sales 14,632 12,515 16.9
Income from operations before depreciation
and amortization (EBITDA) 2,673 2,401 11.3
Income from operations (EBIT) before special
items 2,116 1,865 13.5
Income from operations (EBIT) 2,010 1,849 8.7
Financial result (94) 21 .
Income before taxes and minority interests 1,916 1,870 2.5
Net income 1,035 950 8.9
Earnings per share (EUR ) 2.08 1.87 11.2
EBIT before special items in percent of sales 14.5 14.9 -
Cash provided by operating activities 701 1,448 (51.6)
Additions to long-term assets(1) 439 600 (26.8)
Excluding acquisitions 439 473 (7.2)
Amortization and depreciation(1) 663 552 20.1
Segment assets (end of period)(2) 38,367 29,680 29.3
Personnel costs 1,595 1,392 14.6
Number of employees (end of period) 94,956 79,926 18.8
(1) Tangible and intangible fixed assets
(2) Tangible and intangible fixed assets, inventories and
business-related receivables
Q1 2007 Sales EBIT
BEFORE SPECIAL ITEMS
CHANGE COMPARED
WITH PREVIOUS YEAR'S
QUARTER Q1 2007
compared with Q1 2006
+17% -2%
News from Our Innovation Centers
Environmental technology for diesel motors: Exhaust specialists
from BASF Catalysts are developing diesel oxidation catalysts and
catalyzed soot filters. Innovative solutions are also able to
neutralize nitrogen oxides in exhaust fumes.
The number of diesel vehicles in Europe is continuing to rise, and
their lower fuel consumption is easier on their drivers' wallets.
Diesel exhaust fumes, however, are a real challenge for the
specialists at BASF Catalysts: Diesel engines run at lower
temperatures. Their main problem is that this results in uncombusted
fuel and soot particles in the exhaust, which would rapidly clog up
normal catalysts. To solve this problem BASF's experts have developed
special diesel oxidation catalysts and catalyzed soot filters. These
initially trap the soot and then burn it using a combination of
catalysts and engine controls to govern the oxygen content and
temperature. The terms "soot filter" or "particle filter" therefore
fall a long way short of describing the innovative technology
involved.
Diesel engines also require a "lean" air-fuel mixture that results
in a high content of residual oxygen in the exhaust gas. This
considerably impedes the conversion of nitrogen oxides to nitrogen.
But here too, the experts at BASF Catalysts are busy developing
technical solutions: The nitrogen oxides are initially stored
chemically while the engine is operated in the "lean" mode. When the
storage capacity is exhausted, the engine automatically switches to a
"rich" air-fuel mixture for a short time, allowing the catalyst to
convert the stored nitrogen oxides into nitrogen and oxygen. When the
storage catalyst is regenerated, the engine can switch back to the
lean mixture, which both enhances engine performance and the
combustion of soot particles.
Vehicle catalysts are tested under long-term conditions at BASF's
catalyst testing facility in Union, New Jersey. Complex electronic
sensors are used to record all exhaust gas values during testing. The
experts at BASF Catalysts are among the leading innovators in the
development and optimization of catalysts for gasoline and diesel
engines.
In addition to exhaust catalysts for cars and trucks, there are
numerous additional applications in environmental technology:
-- Catalysts for large-scale plants: In power plants, catalysts reduce
emissions of nitrogen oxides and carbon monoxide.
-- Air purification: Catalytic filters are used in airplane cabins to
ensure low concentrations of irritating ozone gas.
-- Catalysts for small engines: Tailor-made solutions are developed
for motorbikes, lawnmowers and chainsaws.
An umbrella for fungi: Hydrophobin, a protein obtained from fungi
that causes water droplets to roll off, is stimulating the imagination
of biotechnologists and developers at BASF. If produced on a large
scale, it could be used in the future to make car windscreens and
other surfaces water repellent.
Hydrophobin has a broad range of physical and chemical properties
that result in numerous possible applications: It could be used, for
example, as a bonding agent between a variety of materials, or as an
emulsifier for oil-water mixtures. Once it has fulfilled its function,
the protein is naturally biodegraded.
Methods from the area of biotechnology are currently being used in
BASF's research labs to produce what are known as performance
proteins. Nature offers countless examples of proteins with
interesting and promising properties. Technical advances in
fermentation - an area within BASF's white (industrial) biotechnology
cluster - are enabling BASF to synthesize some of these proteins on an
industrial scale for the first time. This will allow consumers to
benefit from the special properties of these natural substances in
their everyday life.
One example of a new product from BASF's research labs is
hydrophobin. This water-repellent protein is found in nature on the
skin of fungi, where it causes raindrops to simply roll off. BASF's
biotechnologists have isolated the gene responsible for producing
hydrophobin and transferred it to the bacterium E. coli. BASF is the
first company able to produce hydrophobin in industrial quantities.
Potential applications, for example in detergents, are currently being
tested.
BASF has almost three decades of experience in the field of white
biotechnology. These activities use microorganisms or isolated enzymes
to manufacture products such as proteins and chiral intermediates as
starting materials for crop protection and pharmaceutical active
ingredients.
Research at BASF combines key technology-driven issues of the future
in five growth clusters for which it has earmarked EUR 850 million for
2006 through 2008.
BASF First-Quarter Results 2007
Contents
2 BASF Group Business Review
4 BASF Shares
5 Significant Events and Outlook
6 Chemicals
7 Plastics 8 Performance Products
9 Agricultural Products & Nutrition
10 Oil & Gas
11 Regions
12 Overview of Other Topics
13 Consolidated Statements of Income
14 Consolidated Balance Sheets
15 Consolidated Statements of Cash Flows
16 Consolidated Statements of Recognized Income and Expense
17 Consolidated Statements of Stockholders' Equity
18 Segment Reporting
19 Explanations to the Interim Financial Statements
Front cover: Overview 1st Quarter 2007 News from Our Innovation
Centers
Back cover: Important Dates Contacts
Cover photo: Sandra Cosmo and Edson Oliveira Santos, production
workers at BASF S.A.'s coatings plant in Sao Bernardo do Campo,
Brazil.
Q1 2007 EARNINGS PER SHARE
EUR 2.08 (+11%)
BASF Group Business Review
Sales
Compared with the same period of 2006, sales in the first quarter
rose 17% to EUR 14.6 billion. This was due primarily to the
acquisitions in mid-2006, as well as higher volumes and sales prices
in the chemical businesses. Disregarding currency effects, in
particular from the depreciation of the U.S. dollar, sales increased
by 21%.
Factors influencing sales
% of sales 1st Quarter
Volumes 2
Prices 4
Acquisitions/divestitures 15
Currencies (4)
17
The sales growth was highest in the Chemicals segment thanks to
the contribution of the new Catalysts division, as well as higher
volumes and increased sales prices in the Inorganics, Petrochemicals
and Intermediates divisions.
Sales rose in all divisions in the Plastics segment. The Styrenics
division in particular increased sales prices significantly and posted
higher volumes.
In the Performance Products segment, all divisions recorded higher
sales as a result of the acquisitions. The Construction Chemicals
division developed very positively thanks to strong growth in the
construction industry in Europe and Asia.
Both divisions in the Agricultural Products & Nutrition segment
posted higher volumes. In the Agricultural Products division, sales
declined compared with the same period of 2006 due to divestitures and
currency translation effects. In the Fine Chemicals division, however,
the acquired personal care products led to a significant increase in
sales.
Volumes declined in the Oil & Gas segment. Sales were at
approximately the same level as in the first quarter of 2006. The
lower oil price led to a decline in sales in the exploration and
production business. This was largely offset by higher sales prices in
the natural gas trading business.
First-quarter sales by segment
Million EUR
Chemicals 2007 3,489 56%
2006 2,239
Plastics 2007 3,348 8%
2006 3,091
Performance 2007 2,826 32%
Products 2006 2,147
Agricultural 2007 1,375 0%
Products
& Nutrition 2006 1,376
Oil & Gas 2007 2,970 (1)%
2006 2,985
BASF Group
-- Sales up 17%
-- EBIT before special items up 13%
-- Earnings jump in the Chemicals segment
-- Acquisitions make significant contribution to rise in earnings
Earnings
Compared with the first quarter of 2006, we increased income from
operations (EBIT) before special items by 13% to EUR 2,116 million.
Earnings in the Chemicals segment almost doubled, and were
significantly higher in all divisions. Margins improved, in particular
for petrochemicals. The Catalysts division also made a major
contribution to the earnings growth.
In the Plastics segment, earnings declined slightly because the
Polyurethanes division did not quite match the strong performance of
the previous year's first quarter. Earnings improved in the Styrenics
business due to the expansion of the business and improved efficiency.
Earnings in the Performance Products segment were lower than in
the first quarter of 2006 as a result of persistent pressure on
margins for functional polymers. This could not be offset by the
earnings contributions from the acquired businesses.
Both divisions in the Agricultural Products & Nutrition segment
posted higher earnings. The earnings situation in Brazil improved in
the Agricultural Products division. In the Fine Chemicals division,
earnings increased as a result of the restructuring measures initiated
in 2006 and the contribution from the acquired personal care business.
In the Oil & Gas segment, a rise in the contribution from the
natural gas trading business kept earnings at the previous year's
strong level despite the decline in oil prices.
Compared with the same period of 2006, first-quarter EBIT after
special items rose by 9% to EUR 2,010 million. Special items in income
from operations were related to integration costs for the acquisitions
made in 2006 and expenses for restructuring that are recorded under
"Other" until they are implemented in the course of the year.
The financial result declined by EUR 115 million to EUR
(94) million. Interest expenses rose in connection with financing for
the acquisitions made in mid-2006. The previous year's first quarter
contained proceeds from the sale of securities.
Income before taxes and minority interests rose by 2% to EUR 1,916
million.
The tax rate declined from 46% to 40% as a result of the
acquisitions and the lower contribution to the BASF Group's earnings
from the Oil & Gas segment. In the first quarter, foreign taxes for
oil production that are noncompensable with German corporate income
tax amounted to EUR 258 million compared with EUR 272 million in the
same period of 2006.
Net income rose by 9% to EUR 1,035 million. Earnings per share
were EUR 2.08 compared with EUR 1.87 in the first quarter of 2006.
First-quarter EBIT before special items
Million EUR
Chemicals 2007 628 98%
2006 317
Plastics 2007 325 (2)%
2006 332
Performance 2007 229 (8)%
Products 2006 248
Agricultural 2007 257 15%
Products
& Nutrition 2006 224
Oil & Gas 2007 845 0%
2006 848
Special items
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Full Year
Million
EUR 2007 2006 2007 2006 2007 2006 2007 2006 2007 2006
- Income
from
operations (106) (16) (113) (177) (201) (507)
-
Financial
result - - - - - -
(106) (16) (113) (177) (201) (507)
BASF Shares
Overview BASF shares
Performance (with dividends reinvested)
BASF % 14.1 17.5
DAX 30 % 4.9 22.1
DJ EURO STOXX 50 % 1.7 18.1
DJ Chemicals % 7.0 21.2
MSCI World Chemicals % 6.3 15.8
Share prices and trading (XETRA)
Average EUR 76.21 64.82
High EUR 84.28 74.24
Low EUR 71.95 58.97
Close (end of period) EUR 84.28 73.85
Million
Average daily trade shares 3.8 3.1
Billion
Market capitalization (end of period) EUR 42.2 37.0
Strong performance of BASF shares
BASF shares increased in value by 14% in the first three months of
2007. As a result, our shares outperformed the German and European
stock markets, whose key indices DAX 30 and DJ EURO STOXX 50 rose by
approximately 5% and 2%, respectively, in the same period. In the
first quarter, BASF shares also outperformed the global industry
indices DJ Chemicals and MSCI World Chemicals, which increased by 7%
and 6%, respectively.
Attractive dividend policy
The proposed dividend of EUR 3.00 per share for 2006 is 50% higher
than in the previous year. We aim to increase our dividend further in
the future, or at least maintain it at the previous year's level.
Further share buybacks
In the first quarter of 2007, we purchased 4.98 million of our own
shares for a total of EUR 381 million or EUR 76.50 per share under our
EUR 3 billion buyback program. The goal of this program, which is to
run until the end of 2008, is to increase our earnings per share and
further optimize our balance sheet structure.
Inclusion in Global 100 sustainability ranking
In January, BASF was included in the Global 100 list by the New
York research house Innovest for the second year in succession. The
Global 100 list comprises the world's most successful companies in the
areas of environmental protection, social affairs and corporate
governance.
Investor relations award
BASF was awarded first place in a ranking of 145 investor
relations websites of companies in 33 countries performed by the
financial communications consulting firm MZ Consult.
> Up-to-date information on BASF shares is available on the
Internet at corporate.basf.com/share.
BASF Shares
-- BASF shares rise 14% in first quarter
-- Shares bought back for EUR 381 million in the first three months of
2007
Significant Events and Outlook
Significant events
The Board of Executive Directors and Supervisory Board of BASF
Aktiengesellschaft have resolved to propose to the Annual Meeting on
April 26, 2007 the transformation of BASF Aktiengesellschaft into a
European Company (Societas Europaea, SE) with the name BASF SE. We
consider the European Company to be a modern legal form for a global
company whose home market is in Europe. The company's headquarters and
chief administrative offices will remain in Ludwigshafen, Germany.
Subject to antitrust approval, BASF plans to sell the majority of
its premix business to the Dutch animal feed group Nutreco as part of
its global program to increase efficiency in the Fine Chemicals
division. In addition, the closure of the production plant for lysine
in Gunsan, South Korea, by mid-2007 was announced at the end of March.
On March 21, 2007, BASF and Monsanto announced a long-term
research and development and commercialization collaboration in plant
biotechnology. The collaboration is effective immediately. Over the
life of the collaboration, the two companies will dedicate a joint
budget of potentially $1.5 billion to the joint development of high
yielding crops and crops that are more tolerant to adverse
environmental conditions. The first products developed as part of this
collaboration are expected to be commercialized in the first half of
the next decade.
Outlook
We continue to expect the following conditions in 2007:
-- Global economic growth of 3.2%
-- Average oil prices (Brent) of about $55/barrel
-- An average euro/dollar exchange rate of $1.30 per euro and
moderately higher interest rates, primarily in Europe
Major risk factors are associated with an escalation in
geopolitical trouble spots.
The good start in the first quarter confirms our positive outlook
for 2007.
We expect significantly higher sales based on the acquisitions
made in 2006 and organic growth. We expect to at least match the
previous year's strong EBIT before special items despite our
assumption of a lower average oil price in 2007.
POWERFUL START TO 2007
-- Transformation of BASF Aktiengesellschaft into a European Company
(BASF SE) planned
-- Long-term plant biotechnology cooperation with Monsanto
-- Good start to 2007 confirms positive outlook:
Significant increase in sales;
EBIT before special items to at least match the previous year's
strong level
Chemicals
Segment data 1st Quarter
Million EUR Change
2007 2006 in %
Sales 3,489 2,239 56
Thereof Inorganics 292 285 2
Catalysts 1,200 21 .
Petrochemicals 1,384 1,374 1
Intermediates 613 559 10
EBITDA 786 452 74
EBIT before special items 628 317 98
EBIT before special items in percent of sales 18.0 14.2 -
EBIT 618 317 95
Assets 10,444 6,198 69
Compared with the same period of 2006, first-quarter sales in the
Chemicals segment rose significantly (volumes 5%, prices 3%, portfolio
53%, currencies -5%). In addition to higher sales volumes and prices,
the sales growth was due in particular to the acquisition of the
catalysts business. Earnings almost doubled compared with the first
quarter of 2006.
Inorganics
Demand remained strong, and we increased the prices of our
products. Sales of inorganic specialties, glues and impregnating
resins and inorganic basic chemicals grew particularly strongly.
Earnings rose as a result of the improvement in margins.
Catalysts
Sales developed particularly positively in the European business
with catalysts for diesel engines, the global business with refinery
catalysts, and the materials services business. The division
contributed significantly to the segment's EBIT even after taking
account of special charges for the integration.
Petrochemicals
Thanks to continued strong demand, sales were at the same level as
in the first quarter of 2006. Earnings increased significantly due to
strong margins for cracker products in Europe and Asia and the
positive development of the global solvents and plasticizers
businesses.
Intermediates
We posted sales growth worldwide in almost all areas of the
portfolio. Strong demand enabled us to increase sales prices. Earnings
increased significantly compared with the first quarter of 2006. This
was due in particular to high capacity utilization rates, as well as
lower fixed costs as a result of the restructuring measures that we
have initiated.
CHEMICALS Sales EBIT
before special items
-- Record sales and
earnings
-- All divisions Q1 2007 Q1 2007
contribute to strong compared with Q1 2006 compared with Q1 2006
earnings growth
-- Significant
contribution from
acquired catalysts
business
+56% +98%
Plastics
Segment data 1st Quarter
Million EUR Change
2007 2006 in %
Sales 3,348 3,091 8
Thereof Styrenics 1,339 1,151 16
Performance Polymers 785 750 5
Polyurethanes 1,224 1,190 3
EBITDA 452 456 (1)
EBIT before special items 325 332 (2)
EBIT before special items in percent
of sales 9.7 10.7 -
EBIT 325 331 (2)
Assets 6,856 6,894 (1)
Sales in the Plastics segment rose as a result of higher volumes
and prices (volumes 4%, prices 9%, currencies -5%). Earnings were
slightly lower than in the first quarter of 2006 due to a decline in
the Polyurethanes division.
Styrenics
Higher sales volumes and significantly higher prices led to strong
sales growth. Business developed particularly positively in Europe and
Asia, where we benefited from strong demand in the construction
sector.
Due to rapidly rising demand for products for thermal insulation,
we will increase production capacity for our innovative insulating
foam Neopor(R) in Ludwigshafen from 60,000 to 190,000 metric tons per
year by the end of 2008 and are starting production of Neopor in Asia.
Earnings more than doubled compared with the weak first quarter of
2006. This was also due to the ongoing measures to increase the
profitability of the division.
Performance Polymers
Sales were higher than in the first quarter of the previous year
due to higher sales prices. In Asia, we increased sales volumes, among
other things due to the new capacity for Ultradur(R) in Kuantan,
Malaysia. We passed on increases in raw material prices in the form of
higher prices. Earnings rose compared with the first quarter of 2006.
Polyurethanes
Sales rose only slightly compared with the same period of the
previous year as a result of the shutdown of the TDI plant in Geismar,
Louisiana; prices remained stable. Demand and volumes continued to
develop positively, especially in Europe and Asia. As a result of the
difficulties with the TDI plant and higher raw material costs, it was
not possible to match the very strong earnings posted in the first
quarter of 2006.
We have strengthened our position in the attractive Benelux market
by acquiring a Dutch polyurethanes systems house.
PLASTICS Sales EBIT
before special items
-- Strong business in
Europe and Asia
-- Improved earnings Q1 2007 Q1 2007
situation in Styrenics compared with Q1 2006 compared with Q1 2006
division
-- Shutdown of a TDI
plant impacts earnings
in Polyurethanes
division +8% -2%
Performance Products
Segment data 1st Quarter
Million EUR Change
2007 2006 in %
Sales 2,826 2,147 32
Thereof Construction Chemicals 458 - -
Coatings 621 591 5
Functional Polymers 852 792 8
Performance Chemicals 895 764 17
EBITDA 355 329 8
EBIT before special items 229 248 (8)
EBIT before special items in percent of
sales 8.1 11.6 -
EBIT 219 247 (11)
Assets 9,882 4,936 100
The strong sales growth was due to the businesses acquired in June
and July 2006 (volumes 2%, prices 1%, portfolio 33%, currencies -4%).
Earnings before special items were lower than in the first quarter of
2006. Earnings were negatively impacted by ongoing margin pressure for
acrylic monomers and paper chemicals.
Construction Chemicals
In Europe, the business grew strongly thanks to the mild weather
and the robust construction industry. In Asia, negative currency
effects in Japan were offset by growth in China, Australia and
Indonesia. In North America, the business was negatively impacted as a
result of the harsh winter and a decline in construction activity. The
overall positive earnings trend in 2006 continued in the first
quarter.
Coatings
First-quarter sales were higher than in 2006. Sales of automotive
(OEM) coatings increased despite a decline in production at some North
American automobile manufacturers. Sales of refinish coatings were
weaker, while sales of architectural coatings and industrial coatings
rose, in particular thanks to the activities acquired from Degussa in
2006. Earnings declined compared with the previous year, primarily due
to the weaker business in North America.
Functional Polymers
Sales increased compared with the previous year's first quarter as
a result of the acquisitions. Persistently high raw material costs and
competitive pressure due to high capacities, in Asia especially, had a
negative impact on margins for acrylic monomers and paper chemicals.
Earnings were therefore significantly lower than in the strong first
quarter of 2006.
Performance Chemicals
Sales rose significantly, in particular due to the activities
acquired in 2006. Sales of performance chemicals for detergents and
formulators also increased, whereas sales of performance chemicals for
textile and leather declined. First-quarter earnings were higher than
in 2006, primarily due to the contribution of the acquired businesses.
PERFORMANCE PRODUCTS Sales EBIT
before special items
-- Strong sales growth due Q1 2007 Q1 2007
to acquisitions in 2006 compared with Q1 2006 compared with Q1 2006
-- Ongoing margin pressure
for acrylic monomers and
paper chemicals
-- Earnings lower than in
first quarter of 2006 +32% - 8%
Agricultural Products & Nutrition
Overview Agricultural Products 1st Quarter
Million EUR Change
2007 2006 in %
Sales 897 928 (3)
EBITDA 268 333 (20)
EBIT before special items 225 213 6
EBIT before special items in percent of
sales 25.1 23.0 -
EBIT 220 280 (21)
Assets 4,880 5,365 (9)
Sales in the Agricultural Products division declined slightly
compared with the first quarter of 2006 due to the divestiture of
large parts of the generics business of Micro Flo Company as well as
the global business with the active ingredient terbufos (volumes 6%,
prices -1%, portfolio -4%, currencies -4%). Currency effects also had
a negative impact on sales.
In Brazil, we increased sales volumes, in particular of products
for sugarcane. In addition, we benefited from a gradual recovery in
the market for soybeans. Although earnings before special items
improved, EBIT declined compared with the same period of the previous
year. In 2006, the special gain from the sale of the generics business
of Micro Flo Company increased earnings.
Overview Fine Chemicals 1st Quarter
Million EUR Change
2007 2006 in %
Sales 478 448 7
EBITDA 55 40 38
EBIT before special items 32 11 191
EBIT before special items in percent of
sales 6.7 2.5 -
EBIT 28 10 180
Assets 1,551 1,489 4
Sales increased in the Fine Chemicals division, in particular due
to the acquired personal care business (volumes 5%, prices -1%,
portfolio 7%, currencies -4%). We increased volumes in other parts of
the portfolio, especially for UV absorbers and Pharma Solutions.
Earnings improved significantly compared with the previous year's
first quarter, also as a result of a reduction in fixed costs.
In February, we signed an agreement to sell the premix business in
eight countries to the Dutch animal feed group Nutreco. In mid-2007,
we will close the production plant for lysine in Gunsan, South Korea,
and will thus exit this business. Both of these measures are part of
our global program to increase efficiency.
AGRICULTURAL PRODUCTS Sales EBIT before
& NUTRITION Q1 2007 special
compared with Q1 items
2006 Q1 2007
compared
with Q1 2006
-- Agricultural Products benefits Agricultural Agricultural
from gradual market recovery in Products Products
Brazil -3% +6%
-- Fine Chemicals proceeds with
program to increase efficiency
Fine Chemicals Fine Chemicals
+7% +191%
Oil & Gas
Segment data 1st Quarter
Million EUR Change
2007 2006 in %
Sales 2,970 2,985 (1)
Thereof Exploration and production 972 1,081 (10)
Natural gas trading 1,998 1,904 5
EBITDA 969 953 2
Thereof Exploration and production 623 707 (12)
Natural gas trading 346 246 41
EBIT before special items 845 848 0
Thereof Exploration and production 533 638 (16)
Natural gas trading 312 210 49
EBIT before special items in percent of
sales 28.5 28.4 -
Thereof Exploration and production 54.8 59.0 -
Natural gas trading 15.6 11.0 -
EBIT 845 848 0
Thereof Exploration and production 533 638 (16)
Natural gas trading 312 210 49
Assets 4,754 4,798 (1)
Thereof Exploration and production 2,163 2,123 2
Natural gas trading 2,591 2,675 (3)
Segment sales were at the level of the first quarter of 2006
(volumes -6%, prices/currencies 5%). Earnings were also at the same
level as in the first quarter of the previous year due to a higher
contribution from natural gas trading.
Volumes in the exploration and production business declined
slightly, in particular due to scheduled maintenance shutdowns in
natural gas production in Argentina. Compared with the first quarter
of 2006, the average price of Brent crude declined by 7% to
approximately $58/barrel. In euro terms, this corresponds to an
decrease of 14% to approximately EUR 44/barrel. This resulted in a
decline in earnings compared with the first quarter of 2006.
Sales volumes in the natural gas trading business were lower than
in the first quarter of 2006 due to the milder weather in Europe;
sales prices and margins improved, however. Sales and earnings were
therefore considerably higher.
The Norwegian energy ministry has assigned Wintershall a new
offshore license. With a stake of 40%, Wintershall will participate
with Norsk Hydro in the exploration block 6407/9. Norway is the
world's fourth largest producer of natural gas and one of the most
important suppliers to the European Union.
OIL & GAS Sales EBIT
before
special
items
-- Decline in oil prices negatively Q1 2007 Q1 2007
impacts earnings in exploration and compared with compared with
production Q1 2006 Q1 2006
-- Higher contribution to earnings
from natural gas trading
-1% 0%
Regions
Overview Regions Sales Sales
(location of company) (location of customer)
Change Change
Million EUR 2007 2006 in % 2007 2006 in %
1st Quarter
Europe 8,860 7,786 14 8,441 7,415 14
Thereof Germany 6,544 5,757 14 3,391 2,972 14
North America (NAFTA) 3,036 2,637 15 3,049 2,617 17
Asia Pacific 2,111 1,648 28 2,228 1,777 25
South America, Africa,
Middle East 625 444 41 914 706 29
14,632 12,515 17 14,632 12,515 17
Overview Regions EBIT before special
items
Change
Million EUR 2007 2006 in %
1st Quarter
Europe 1,591 1,420 12
Thereof Germany 1,199 1,015 18
North America (NAFTA) 265 298 (11)
Asia Pacific 207 115 80
South America, Africa,
Middle East 53 32 66
2,116 1,865 13
Sales by location of company in Europe increased by 14% in the
first quarter of 2007. EBIT before special items rose by EUR
171 million to EUR 1,591 million. This was due both to the acquired
businesses and organic growth in the chemical businesses. Earnings in
the Oil & Gas segment matched the previous year's level despite the
decline in oil prices.
As a result of the acquisitions, companies in North America
increased sales by 23% in dollar terms and by 15% in euro terms. EBIT
before special items declined by EUR 33 million to EUR 265 million.
Earnings were reduced by the shutdown of the TDI plant in Geismar,
Louisiana, as well as by weaker demand from the automotive industry.
This could not be fully offset by the acquired businesses.
In Asia Pacific, we increased sales by 37% in local currency terms
and by 28% in euro terms. EBIT before special items climbed EUR
92 million to EUR 207 million. The sales and earnings growth was due
to the acquisitions as well as strong demand for products from the
Chemicals and Plastics segments. The measures to increase efficiency
that were initiated in 2006 also contributed to the rise in earnings.
In South America, Africa, Middle East first-quarter sales by
location of company rose by 49% in local currency terms and by 41% in
euro terms. EBIT before special items increased by EUR 21 million to
EUR 53 million. The activities of the Catalysts division in South
Africa and the Agricultural Products division in South America
contributed to the expansion of the business. Higher prices for
agricultural produce have improved the economic situation for farmers
in Brazil, thus increasing demand for crop protection products.
FROM THE REGIONS
-- Europe: Earnings improve due to acquisitions and organic growth
-- North America: Shutdown of TDI plant negatively impacts earnings
-- Asia: Profitable growth in Chemicals and Plastics segments
-- South America: Agricultural Products business improves
Overview of Other Topics
Research and development
In 2007, BASF is planning to launch two new active ingredients:
the rice fungicide orysastrobin and the insecticide metaflumizone. The
peak sales potential of BASF's development pipeline of innovative crop
protection active ingredients is EUR 800 million. The Agricultural
Products division is currently working on developing seven new active
ingredients and on one new herbicide tolerance project. Seven
additional crop protection active ingredients with a peak sales
potential of EUR 1,000 million are currently being introduced to the
market.
The collaboration agreement with Monsanto that was signed in March
shows that BASF's innovativeness makes it an attractive partner in the
area of plant biotechnology. The collaboration focuses on developing
and marketing high yielding crops and crops that are more tolerant to
adverse environmental conditions such as heat and drought. The joint
pipeline will include the companies' existing and planned yield and
stress tolerance programs for the globally important crops corn
(maize), soybeans, cotton and canola (oilseed rape). The companies
also announced that they had entered into a separate development and
commercialization collaboration to research methods to control the
soybean cyst nematode, a parasitic worm that can limit and destroy
yields for soybean farmers.
Over the life of the collaboration, BASF and Monsanto will
dedicate a combined budget of potentially $1.5 billion to the joint
development pipeline. This results in an increase in BASF's research
costs for plant biotechnology, which are recorded under "Other."
The innovative insulating foam Neopor(R) needs less material to
achieve the same insulation quality as Styropor(R), thus making a key
contribution to energy efficiency and climate protection. Silver-gray
Neopor is primarily used to insulate buildings and contains special
graphite particles that reflect heat waves like a mirror. Thanks to
strong demand, BASF will triple production capacity for Neopor in
Ludwigshafen by the end of 2008 and will also start producing this
insulating material in South Korea.
Employees
Compared with the end of 2006, the number of BASF Group employees
declined by 291 to 94,956. As a result, the number of employees
declined by 0.7% in Europe and by 0.6% in North America. In the South
America, Africa, Middle East region and in Asia Pacific, the number of
employees rose by 0.9% and 1.5%, respectively.
As a result of the acquisitions, personnel costs increased by 15%
compared with the same period of 2006 and amounted to EUR 1,595
million in the first quarter of 2007.
RESEARCH AND DEVELOPMENT Research costs by segment
First quarter 2007
-- Collaboration with Monsanto to
develop and market stress-tolerant 1 Chemicals 13%
and high yielding crops 2 Plastics 11%
-- Innovative insulating foam 3 Performance Products 23%
Neopor(R)ensures greater energy Agricultural Products &
efficiency 4 Nutrition 26%
5 Corporate research, Other 27%
100%
Consolidated Statements of Income
1st Quarter
Million EUR Change
2007 2006 in %
Sales 14,632 12,515 16.9
Cost of sales 10,355 8,888 16.5
Gross profit on sales 4,277 3,627 17.9
Selling expenses 1,325 1,103 20.1
General and administrative expenses 246 186 32.3
Research and development expenses 345 305 13.1
Other operating income 156 250 (37.6)
Other operating expenses 507 434 16.8
Income from operations 2,010 1,849 8.7
Income from financial assets 18 15 20.0
Interest result (112) (48) .
Other financial result - 54 -
Financial result (94) 21 .
Income before taxes and minority interests 1,916 1,870 2.5
Income taxes 775 853 (9.1)
Income before minority interests 1,141 1,017 12.2
Minority interests 106 67 58.2
Net income 1,035 950 8.9
Earnings per share
Number of shares, in million (weighted) 497 509 (2.4)
Dilutive effect - - -
Earnings per share (EUR )
Undiluted 2.08 1.87 11.2
Diluted 2.08 1.87 11.2
Full Year
Million EUR 2006
Sales 52,610
Cost of sales 37,698
Gross profit on sales 14,912
Selling expenses 4,995
General and administrative expenses 893
Research and development expenses 1,277
Other operating income 934
Other operating expenses 1,931
Income from operations 6,750
Income from financial assets 72
Interest result (372)
Other financial result 77
Financial result (223)
Income before taxes and minority interests 6,527
Income taxes 3,061
Income before minority interests 3,466
Minority interests 251
Net income 3,215
Earnings per share
Number of shares, in million (weighted) 504
Dilutive effect -
Earnings per share (EUR )
Undiluted 6.37
Diluted 6.37
Consolidated Balance Sheets
Assets
Million EUR March March Change
31, 31, in %
2007 2006
Long-term assets
Intangible assets 8,888 3,662 142.7
Property, plant and equipment 14,772 13,976 5.7
Investments accounted for using the equity
method 672 267 151.7
Other financial assets 1,181 866 36.4
Deferred taxes 622 1,046 (40.5)
Other long-term assets 698 521 34.0
26,833 20,338 31.9
Short-term assets
Inventories 6,372 5,364 18.8
Accounts receivable, trade 8,714 7,529 15.7
Other receivables and miscellaneous
short-term assets 3,056 1,694 80.4
Marketable securities 59 116 (49.1)
Cash and cash equivalents 658 2,999 (78.1)
18,859 17,702 6.5
Total assets 45,692 38,040 20.1
Assets
Million EUR Dec. 31, Change
2006 in %
Long-term assets
Intangible assets 8,922 (0.4)
Property, plant and equipment 14,902 (0.9)
Investments accounted for using the equity
method 651 3.2
Other financial assets 1,190 (0.8)
Deferred taxes 622 -
Other long-term assets 612 14.1
26,899 (0.2)
Short-term assets
Inventories 6,672 (4.5)
Accounts receivable, trade 8,223 6.0
Other receivables and miscellaneous
short-term assets 2,607 17.2
Marketable securities 56 5.4
Cash and cash equivalents 834 (21.1)
18,392 2.5
Total assets 45,291 0.9
Stockholders' equity
Million EUR March March Change
31, 31, in %
2007 2006
Stockholders' equity
Subscribed capital 1,267 1,301 (2.6)
Capital surplus 3,157 3,118 1.3
Retained earnings 13,974 12,525 11.6
Other comprehensive income 329 680 (51.6)
Minority interests 568 478 18.8
19,295 18,102 6.6
Long-term liabilities
Provisions for pensions and similar
obligations 1,446 1,419 1.9
Other provisions 3,055 2,788 9.6
Deferred taxes 1,396 640 118.1
Financial indebtedness 5,783 3,629 59.4
Other long-term liabilities 947 1,033 (8.3)
12,627 9,509 32.8
Short-term liabilities
Accounts payable, trade 3,791 2,770 36.9
Provisions 2,994 3,046 (1.7)
Tax liabilities 1,163 1,252 (7.1)
Financial indebtedness 3,803 1,719 121.2
Other short-term liabilities 2,019 1,642 23.0
13,770 10,429 32.0
Total stockholders' equity and liabilities 45,692 38,040 20.1
Stockholders' equity
Million EUR Dec. 31, Change
2006 in %
Stockholders' equity
Subscribed capital 1,279 (0.9)
Capital surplus 3,141 0.5
Retained earnings 13,302 5.1
Other comprehensive income 325 1.2
Minority interests 531 7.0
18,578 3.9
Long-term liabilities
Provisions for pensions and similar
obligations 1,452 (0.4)
Other provisions 3,080 (0.8)
Deferred taxes 1,441 (3.1)
Financial indebtedness 5,788 (0.1)
Other long-term liabilities 972 (2.6)
12,733 (0.8)
Short-term liabilities
Accounts payable, trade 4,755 (20.3)
Provisions 2,848 5.1
Tax liabilities 858 35.5
Financial indebtedness 3,695 2.9
Other short-term liabilities 1,824 10.7
13,980 (1.5)
Total stockholders' equity and liabilities 45,291 0.9
Consolidated Statements of Cash Flows
1st Quarter
Million EUR 2007 2006
Net income 1,035 950
Depreciation and amortization of long-term assets 663 552
Changes in net working capital (1,031) 61
Miscellaneous items 34 (115)
Cash provided by operating activities 701 1,448
Payments related to tangible and intangible assets (465) (493)
Acquisitions/divestitures (15) (7)
Financial investments and other items (6) 195
Cash using in investing activities (486) (305)
Proceeds from capital increases/repayments (381) (377)
Changes in financial liabilities 50 1,407
Dividends (66) (85)
Cash provided by/used in financing activities (397) 945
Net changes in cash and cash equivalents (182) 2,088
Cash and cash equivalents as of beginning of year
and other changes 840 911
Cash and cash equivalents as shown on the balance
sheet 658 2,999
Cash provided by operating activities
In the first quarter of 2007, cash provided by operating
activities amounted to EUR 701 million compared with EUR 1,448 million
in the same period of 2006. This significant decline was due to a
higher level of net working capital. As a result of the expansion of
the business and seasonal effects in the Agricultural Products
division, receivables rose, while trade accounts payable declined
significantly.
Cash used in investing activities
Cash used in investing activities amounted to EUR 486 million
compared with EUR 305 million in the first quarter of 2006. The first
quarter of 2006 contained a cash inflow from the sale of securities.
Cash used in financing activities
We used EUR 381 million to buy back shares. In the first quarter
of 2007, we bought back 4.98 million shares for an average price of
EUR 76.50 per share under the EUR 3 billion buyback program that is
scheduled to run until the end of 2008.
Cash and cash equivalents amounted to EUR 658 million as of March
31, 2007 compared with EUR 834 million as of the end of 2006. In the
same period, financial indebtedness rose by EUR 103 million to EUR
9,586 million. Compared with year-end 2006, net debt increased by EUR
279 million to EUR 8,928 million.
Consolidated Statements of Recognized Income and Expense
Income and expense items
1st Quarter
Million EUR 2007 2006
Net income before minority interests 1,141 1,017
Fair value changes in available-for-sale securities 1 56
Cash-flow hedges 49 16
Change in foreign currency translation adjustments (30) (83)
Actuarial gains/losses from pensions and other
obligations 15 55
Deferred taxes (10) (14)
Minority interests (3) (5)
Total income and expenses recognized in equity 22 25
Total income and expense for the period 1,163 1,042
Thereof BASF 1,060 979
Thereof minority interests 103 63
Development of income and expense recognized directly in equity
Retained
earnings Other comprehensive income
Foreign Fair value Cash- Total of
Actuarial currency changes in flow other
Million EUR gains/ translation available- hedges comprehen-
losses adjustments for-sale sive income
securities
As of January
1, 2007 (782) 26 341 (42) 325
Additions 15 - 1 49 50
Releases - (30) - - (30)
Deferred taxes 6 1 . (17) (16)
As of March 31,
2007 (761) (3) 342 (10) 329
As of January
1, 2006 (894) 475 258 (37) 696
Additions 55 - 56 16 72
Releases - (83) - - (83)
Deferred taxes (9) 2 (1) (6) (5)
As of March 31,
2006 (848) 394 313 (27) 680
Total income
and expense
recognized
directly in
equity
Million EUR
As of January
1, 2007 (457)
Additions 65
Releases (30)
Deferred taxes (10)
As of March 31,
2007 (432)
As of January
1, 2006 (198)
Additions 127
Releases (83)
Deferred taxes (14)
As of March 31,
2006 (168)
Consolidated Statements of Stockholders' Equity
1st Quarter 2007 Number of
subscribed
shares Subscribed Capital Retained
outstanding capital surplus earnings
Million EUR
As of January 1, 2007 499,680,000 1,279 3,141 13,302
Share buy-back and
cancellation of own
shares including own shares
intended to be cancelled (4,975,000) (12) 16 (385)
Capital injection by
minority interests - - - -
Dividends paid - - - -
Net income - - - 1,035
Income and expense
recognized directly
in equity - - - 21
Change in scope of
consolidation and
other changes - - - 1
As of March 31, 2007 494,705,000 1,267 3,157 13,974
1st Quarter 2007 Other Stock-
comprehensive Minority holders'
income interests equity
Million EUR
As of January 1, 2007 325 531 18,578
Share buy-back and
cancellation of own
shares including own shares
intended to be cancelled - - (381)
Capital injection by
minority interests - - -
Dividends paid - (66) (66)
Net income - 106 1,141
Income and expense
recognized directly
in equity 4 (3) 22
Change in scope of
consolidation and
other changes - - 1
As of March 31, 2007 329 568 19,295
1st Quarter 2006 Number of
subscribed
shares Subscribed Capital Retained
outstanding capital surplus earnings
Million EUR
As of January 1, 2006 514,379,000 1,317 3,100 11,928
Share buy-back and
cancellation of own
shares including own shares
intended to be cancelled (6,259,000) (16) 18 (398)
Capital injection by
minority interests - - - -
Dividends paid - - - -
Net income - - - 950
Income and expense
recognized directly
in equity - - - 46
Change in scope of
consolidation and
other changes - - - (1)
As of March 31, 2006 508,120,000 1,301 3,118 12,525
1st Quarter 2006 Other com- Stock-
prehensive Minority holders'
income interests equity
Million EUR
As of January 1, 2006 696 482 17,523
Share buy-back and
cancellation of own
shares including own shares
intended to be cancelled - - (396)
Capital injection by
minority interests - 18 18
Dividends paid - (85) (85)
Net income - 67 1,017
Income and expense
recognized directly
in equity (16) (5) 25
Change in scope of
consolidation and
other changes - 1 -
As of March 31, 2006 680 478 18,102
Segment Reporting
1st Quarter
Sales EBITDA
Change Change
Million EUR 2007 2006 in % 2007 2006 in %
Chemicals 3,489 2,239 55.8 786 452 73.9
Plastics 3,348 3,091 8.3 452 456 (0.9)
Performance Products 2,826 2,147 31.6 355 329 7.9
Agricultural Products
& Nutrition 1,375 1,376 (0.1) 323 373 (13.4)
Thereof Agricultural
Products 897 928 (3.3) 268 333 (19.5)
Fine Chemicals 478 448 6.7 55 40 37.5
Oil & Gas 2,970 2,985 (0.5) 969 953 1.7
Other* 624 677 (7.8) (212) (162) (30.9)
14,632 12,515 16.9 2,673 2,401 11.3
1st Quarter
Income from
operations before Income from
special items operations (EBIT)
Change Change
Million EUR 2007 2006 in % 2007 2006 in %
Chemicals 628 317 98.1 618 317 95.0
Plastics 325 332 (2.1) 325 331 (1.8)
Performance Products 229 248 (7.7) 219 247 (11.3)
Agricultural Products
& Nutrition 257 224 14.7 248 290 (14.5)
Thereof Agricultural
Products 225 213 5.6 220 280 (21.4)
Fine Chemicals 32 11 190.9 28 10 180.0
Oil & Gas 845 848 (0.4) 845 848 (0.4)
Other* (168) (104) (61.5) (245) (184) (33.2)
2,116 1,865 13.5 2,010 1,849 8.7
1st Quarter
Research and
development
expenses Assets**
Change Change
Million EUR 2007 2006 in % 2007 2006 in %
Chemicals 46 31 48.4 10,444 6,198 68.5
Plastics 36 41 (12.2) 6,856 6,894 (0.6)
Performance Products 79 60 31.7 9,882 4,936 100.2
Agricultural Products
& Nutrition 91 97 (6.2) 6,431 6,854 (6.2)
Thereof Agricultural
Products 75 80 (6.3) 4,880 5,365 (9.0)
Fine Chemicals 16 17 (5.9) 1,551 1,489 4.2
Oil & Gas - - - 4,754 4,798 (0.9)
Other* 93 76 22.4 7,325 8,360 (12.4)
345 305 13.1 45,692 38,040 20.1
1st Quarter
Additions to Amortization and
fixed assets*** depreciation***
Change Change
Million EUR 2007 2006 in % 2007 2006 in %
Chemicals 130 162 (19.8) 168 135 24.4
Plastics 92 218 (57.8) 127 125 1.6
Performance Products 87 81 7.4 136 82 65.9
Agricultural Products
& Nutrition 28 37 (24.3) 75 83 (9.6)
Thereof Agricultural
Products 17 15 13.3 48 53 (9.4)
Fine Chemicals 11 22 (50.0) 27 30 (10.0)
Oil & Gas 79 75 5.3 124 105 18.1
Other* 23 27 (14.8) 33 22 50.0
439 600 (26.8) 663 552 20.1
* "Other" includes the fertilizers business and other businesses
as well as expenses, income and assets not allocated to the segments.
This item also includes foreign currency results from financial
indebtedness that are not allocated to the segments, hedging of
forecasted sales as well as from currency positions that are
macro-hedged (EUR 3 million in the first quarter of 2007 (first
quarter 2006: EUR 55 million)).
** The assets of "Other" includes the assets of the fertilizers
business and other businesses as well as assets that are not allocated
to the segments (financial assets, cash and cash equivalents,
financial receivables, deferred taxes; first quarter 2007: EUR 4,826
million, first quarter 2006: EUR 6,685 million).
*** Tangible and intangible fixed assets
Explanations to the Interim Financial Statements
1. Basis of presentation
The Consolidated Financial Statements of BASF Group for the year
ended December 31, 2006 were prepared according to the International
Financial Reporting Standards (IFRS) valid as of the balance sheet
date. The current interim financial statements were prepared using the
same accounting policies.
> BASF's Financial Report for fiscal 2006 is available on the
Internet at corporate.basf.com/financial-report.
Compared with the end of 2006, the assumptions used to determine
expenses for pension benefit did not have to be changed as of March
31, 2007: The interest rate and expected pension increase were
unchanged at 4.50% and 1.75%, respectively.
The interim financial statements have not been audited.
2. Scope of consolidation
The Consolidated Financial Statements include BASF
Aktiengesellschaft, the parent company, as well as all material
subsidiaries on a fully consolidated basis. Material jointly operated
companies are proportionally consolidated. The number of fully and
proportionally consolidated companies has developed as follows:
Scope of consolidation
2007 2006
As of January 1 328 180
Thereof proportionally consolidated 19 15
First-time consolidations 11 151
Thereof proportionally consolidated - 4
Thereof changes in the consolidation
method - -
Deconsolidations 4 3
Thereof proportionally consolidated - -
As of March 31/December 31 335 328
Thereof proportionally consolidated 19 19
Eleven companies, thereof nine holding companies and two companies
due to their increased importance, have been included in the scope of
consolidation for the first time since January 1, 2007.
Four companies have been deconsolidated since the beginning of
2007 because they were merged with other BASF companies or sold.
Companies accounted for using the equity method were as follows:
Equity method
March 31, Dec. 31
2007 2006
Affiliated companies 10 11
Joint ventures 6 6
Other associated companies 3 3
19 20
FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements under the U.S.
Private Securities Litigation Reform Act of 1995. These statements are
based on current expectations, estimates and projections of BASF
management and currently available information. They are not
guarantees of future performance, involve certain risks and
uncertainties that are difficult to predict and are based upon
assumptions as to future events that may not prove to be accurate.
Many factors could cause the actual results, performance or
achievements of BASF to be materially different from those that may be
expressed or implied by such statements. Such factors include those
discussed in BASF's Form 20-F filed with the Securities and Exchange
Commission. The Report on Form 20-F is available on the Internet at
corporate.basf.com/20-F-Report. We do not assume any obligation to
update the forward-looking statements contained in this report.
CONTACT: BASF
Michael Grabicki
Phone +49 621 60-99938
Fax +49 621 60-92693
michael.grabicki@basf.com
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Current Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BASF Aktiengesellschaft
April 26, 2007 By: /s/ Elisabeth Schick
------------------------------------
Name: Elisabeth Schick
Title: Director Site Communications
Ludwigshafen and Europe
By: /s/ Christian Schubert
------------------------------------
Name: Christian Schubert
Title: Director Corporate
Communications BASF Group