BASF lifts profit guidance again on higher chemicals prices
Reuters
Published Oct 27, 2021 01:55AM ET
FRANKFURT (Reuters) - Germany's BASF increased its 2021 earnings guidance on Wednesday for the third time as its large industrial customers readily accepted marked-up prices for basic chemicals amid a raft of global materials shortages.
The world's largest chemicals maker by sales said in a statement it now expected 2021 earnings before interest and tax (EBIT), adjusted for special items, to come in at between 7.5 billion and 8 billion euros ($8.7-$9.3 billion), compared to a previous forecast for 7.0 billion to 7.5 billion euros.
Adjusted operating earnings in the third-quarter, when a summer lull normally dampens demand in the sector, jumped to 1.87 billion euros, up from 581 million euros in the pandemic-stricken year-earlier period and beating the 1.8 billion expected on average by analysts.
A 42% surge in group revenues to 19.7 billion euros was fuelled by price increases of 36% on average.
The upswing came even as a shortage of microchips in the car sector and power cuts in China were a drag on demand.
"Growth momentum slowed compared with the previous quarter due to supply bottlenecks in many value chains of the manufacturing sector," the company said.
While benefiting BASF's basic chemicals units, the global material scarcities and higher procurement costs proved a burden on BASF businesses that make more sophisticated products such as farming pesticides, coatings and nutritional supplements, where margins and earnings slipped.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.