BASF: swings to third-quarter loss, shares drop
(CercleFinance.com) - BASF said on Friday that it expects to report a third-quarter loss that is wider than analysts' estimate, due to the weak macroeconomic fundamentals resulting from the coronavirus pandemic.
According to preliminary figures, the German chemicals giant turned to a negative EBIT of 2.6 billion euros in the past quarter, citing heavy non-cash-effective impairments and provisions for restructuring.
This compares to a profit of 1.4 billion euros in the third quarter of 2019.
BASF said it had to book quarterly asset impairments of 2.8 billion euros on the back of weaker demand from the automotive and aviation industries - which impacted its surface technologies business - and oversupply of basic chemicals.
For the full year 2020, the company said it expects sales of 57 billion euros to 58 billion euros, from 59.3 billion euros in 2019, mainly due to weaker demand as a consequence of the pandemic.
It anticipates EBIT before special items of between 3 billion euros and 3.3 billion euros for 2020, from 4.6 billion euros last year.
BASF said it expects pressure on margins to continue, especially for basic chemicals, which sent its shares down almost 3% on Friday afternoon on the Frankfurt Stock Exchange.
Copyright (c) 2020 CercleFinance.com. All rights reserved.
According to preliminary figures, the German chemicals giant turned to a negative EBIT of 2.6 billion euros in the past quarter, citing heavy non-cash-effective impairments and provisions for restructuring.
This compares to a profit of 1.4 billion euros in the third quarter of 2019.
BASF said it had to book quarterly asset impairments of 2.8 billion euros on the back of weaker demand from the automotive and aviation industries - which impacted its surface technologies business - and oversupply of basic chemicals.
For the full year 2020, the company said it expects sales of 57 billion euros to 58 billion euros, from 59.3 billion euros in 2019, mainly due to weaker demand as a consequence of the pandemic.
It anticipates EBIT before special items of between 3 billion euros and 3.3 billion euros for 2020, from 4.6 billion euros last year.
BASF said it expects pressure on margins to continue, especially for basic chemicals, which sent its shares down almost 3% on Friday afternoon on the Frankfurt Stock Exchange.
Copyright (c) 2020 CercleFinance.com. All rights reserved.