Jul 31, 2008, 6:59 GMT
Frankfurt - BASF, the world's largest chemicals concern, posted strong growth in sales in the second quarter in results released Thursday, largely as a result of higher natural gas production.
The German-based group exceeded analysts' expectations with an 11- per-cent rise in sales over the quarter to 16.3 billion euros (25.4 billion dollars).
Bottom-line profits rose 27 per cent to 1.3 billion euros, also beating forecasts, while profits on an EBIT before special items basis rose 19 per cent to 2.4 billion euros.
Sales in the oil and gas segment rose 41 per cent as a result of higher gas production. The group said it would have to raise sales prices 'considerably in some cases' to pass on significantly higher raw material costs.
Sales in the Asia-Pacific region rose 19 per cent in local currency terms and 8 per cent in euro terms, while the South America, Africa and Middle East division posted a 16-per-cent rise on a local currency basis and 10 per cent in euros.
In North America, sales increased 14 per cent in dollar terms, although measured in euros this came in at a decline of 1 per cent. Profits on an EBIT basis was 19 per cent down over the first half in this region.
The group confirmed its forecast for the year as a whole.
'Despite the challenging economic environment with high raw material costs, we are confident that we will achieve the goals we have set for 2008,' board chairman Juergen Hambrecht said.
'Assuming that there are no changes to BASF's portfolio, we aim to increase sales and to improve EBIT before special items slightly,' he added.
Chief financial officer Kurt Bock said the group had completed its share buyback programme ahead of schedule, buying shares for 1.1 billion euros in the first half to complete the 3-billion-euro programme announced in February last year some six months ahead of schedule.
A further buyback for the same amount has begun and is set for completion by mid-2010.
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