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
November 11, 2004
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- .
Third-Quarter Results 2004; BASF Grows Faster Than the Market
LUDWIGSHAFEN, Germany--(BUSINESS WIRE)--Nov. 11, 2004--BASF
(NYSE:BF) (FWB:BAS) (LSE:BFA):
-- Further strong increase in sales and EBIT before special items
-- Sales prices increased to reflect higher raw materials costs
-- Risks due to high raw materials prices
-- Outlook for full year 2004:
- Significant increase in sales and EBIT before special items
- Premium will be earned on cost of capital
BASF continued on its successful course in the third quarter of
2004 and again posted excellent interim results. The successful first
half of 2004 ran seamlessly into the third quarter. There were no
signs of the usual summer lull in business. Capacity utilization of
BASF's plants improved due to strong demand. The high oil price, which
has increased even further, allowed the company to pass on some
necessary price increases to the market.
Compared with the third quarter of 2003, sales increased 20
percent to EUR 9.3 billion, and income from operations (EBIT) before
special items rose 160 percent to more than EUR 1 billion.
Cumulative sales in the first nine months of 2004 amounted to EUR
27.7 billion. This was an increase of more than 11 percent compared
with the same period of 2003. EBIT before special items in the first
nine months climbed 55 percent to EUR 3.4 billion.
Outlook for full year 2004: significant increase in EBIT before
special items
Dr. Juergen Hambrecht, Chairman of the Board of Executive
Directors of BASF Aktiengesellschaft, announced that ongoing
initiatives and programs to increase efficiency and reduce costs would
be continued. "We cannot afford to take a break from our restructuring
efforts. Tough global competition means that we have to constantly
improve our productivity, especially in those areas with low growth
rates," he said.
Hambrecht summarized his outlook as follows: "For the full year
2004, we confidently expect a significant increase in sales and EBIT
before special items. We therefore anticipate that we will earn a
premium on our cost of capital."
Sales and earnings growth
BASF's Chief Financial Officer, Dr. Kurt Bock, pointed out that
the third quarter of 2004 was the thirteenth quarter in succession in
which sales volumes had increased compared with the previous year. For
Bock, this shows that BASF is growing faster than the market.
The increase in third-quarter sales by about EUR 1.6 billion to a
record high of EUR 9.3 billion was due to higher volumes, and for the
first time in a while, to price increases for many products in the
portfolio.
Negative currency effects were primarily due to the depreciation
of the dollar against the euro. Adjusted for the exchange rate effect,
sales increased by 25 percent.
The increase in EBIT before special items by EUR 651 million to
more than EUR 1 billion was due to higher volumes as well as a
reduction in fixed costs.
Special charges of EUR 96 million were primarily due to structural
measures to increase productivity and were incurred in particular in
the Chemicals and Agricultural Products & Nutrition segments.
EBIT after special items increased by 156 percent to EUR 958
million.
The tax rate was approximately 56 percent and was thus slightly
higher compared with the previous year. The tax rate was significantly
higher than in the second quarter. This was primarily due to
noncompensable oil production taxes, which increased to EUR 197
million in the third quarter as a result of the high oil price.
Compared with the same period in 2003, net income climbed EUR 217
million to EUR 337 million. BASF has reduced the number of outstanding
shares through its share buyback program. As a result, earnings per
share almost tripled.
Chemical activities successful in all regions
In the third quarter of 2004, BASF again increased its sales and
earnings in all regions and gained market share worldwide. "I am
particularly pleased by the good performance of our entire chemical
activities in all regions. This was primarily due to strong volumes,
higher sales prices and our global restructuring and cost reduction
measures," said Hambrecht.
BASF is the world's leading chemical company. Our goal is to grow
profitably and further increase the value of our company. We help our
customers to be more successful through intelligent system solutions
and high-quality products. BASF's portfolio ranges from chemicals,
plastics, performance products, agricultural products and fine
chemicals to crude oil and natural gas. Through new technologies we
can tap into additional market opportunities. We conduct our business
in accordance with the principles of sustainable development. In 2003,
BASF had sales of more than EUR 33 billion (circa $42 billion). BASF
shares are traded on the stock exchanges in Frankfurt (BAS), London
(BFA), New York (BF), Paris (BA) and Zurich (AN). Further information
on BASF is available on the Internet at www.basf.com.
The following information is also available on the Internet:
Interim report (from 7:30 a.m. CET)
www.basf.de/interimreport (English)
www.basf.de/zwischenbericht (German)
News release (from 7:30 a.m. CET)
www.basf.de/pressrelease (English)
www.basf.de/pressemitteilungen (German)
Live transmission (from 10:30 a.m. CET)
www.basf.de/pcon (English)
www.basf.de/pk (German)
Speech by Dr. Juergen Hambrecht/Dr. Kurt Bock - printed form
(from 10:30 a.m. CET)
www.basf.de/pressconference (English)
www.basf.de/pressekonferenz (German)
Photos (from 7:30 a.m. CET)
www.basf.de/photos (English)
www.basf.de/fotos (German)
Information about BASF shares
www.basf.de/share (English)
www.basf.de/aktie (German)
Live transmission of the analysts' conference (from 3:30 p.m. CET)
www.basf.de/share (English)
www.basf.de/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.
Third-Quarter Results 2004
July - September 2004, published on November 11, 2004
BASF grows faster than the market
Overview
BASF Group 3rd Quarter January - September
Change Change
Million EUR 2004 2003 in % 2004 2003 in %
Sales 9,314 7,740 20.3 27,679 24,821 11.5
Income from operations
before interest, taxes,
depreciation and
amortization (EBITDA) 1,560 957 63.0 4,884 3,801 28.5
Income from operations
before special items 1,054 403 161.5 3,389 2,179 55.5
Income from operations
(EBIT) 958 374 156.1 3,177 2,090 52.0
Financial result (93) (108) 13.9 (176) (299) 41.1
Income before taxes and
minority interests 865 266 225.2 3,001 1,791 67.6
Net income 337 120 180.8 1,486 757 96.3
Earnings per share (EUR ) 0.62 0.21 195.2 2.70 1.34 101.5
EBIT before special items
in percent of sales 11.3 5.2 - 12.2 8.8 -
Cash provided by
operating activities 1,559 1,677 (7.0) 3,718 3,555 4.6
Additions to fixed
assets(a) 460 523 (12.0) 1,399 2,731 (48.8)
Amortization and
depreciation (a) 602 583 3.3 1,707 1,711 (0.2)
Segment assets (end of
period)(b) 26,336 26,483 (0.6) - - -
Personnel costs 1,439 1,388 3.7 4,184 4,192 (0.2)
Number of employees (end
of period) 84,784 88,045 (3.7) - - -
(a) Tangible and intangible fixed assets (including acquisitions)
(b) Tangible and intangible fixed assets, inventories and
business-related receivables
Income from Income from
operations before operations
Segments Sales special items (EBIT)
Change Change Change
Million EUR 2004 2003 in % 2004 2003 in % 2004 2003 in %
3rd Quarter
Chemicals 1,811 1,367 32.5 331 101 227.7 302 99 205.1
Plastics 2,827 2,135 32.4 158 67 135.8 147 64 129.7
Performance
Products 2,068 1,930 7.2 192 144 33.3 190 135 40.7
Agricultural
Products &
Nutrition 1,035 1,054 (1.8) (36) (97) 62.9 (66) (114) 42.1
Oil & Gas 1,163 927 25.5 458 271 69.0 458 271 69.0
Other(a) 410 327 25.4 (49) (83) 41.0 (73) (81) 9.9
Thereof
costs
of exploratory
and biotechno-
logical
research - - - 37 44 (15.9) 37 44 (15.9)
9,314 7,740 20.3 1,054 403 161.5 958 374 156.1
January -
September
Chemicals 5,141 4,319 19.0 909 380 139.2 858 370 131.9
Plastics 7,656 6,595 16.1 480 253 89.7 459 240 91.3
Performance
Products 6,026 5,748 4.8 605 431 40.4 593 414 43.2
Agricultural
Products &
Nutrition 4,003 3,855 3.8 474 349 35.8 419 303 38.3
Oil & Gas 3,647 3,338 9.3 1,140 953 19.6 1,147 953 20.4
Other(a) 1,206 966 24.8 (219) (187)(17.1) (299) (190)(57.4)
Thereof
costs
of exploratory
and biotechno-
logical
research - - - 110 129 (14.7) 110 129 (14.7)
27,679 24,821 11.5 3,389 2,179 55.5 3,177 2,090 52.0
(a) "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 as well as from
currency positions that are macro-hedged.
BASF Group Business Review and Analysis
-- Sales and earnings significantly higher compared with weak
third quarter of 2003
-- High volume growth in excess of market
-- Sales prices increased to reflect higher raw materials costs
-- Strongest growth in Chemicals and Plastics segments
-- Outlook for full year 2004:
- Significant increase in sales and EBIT before special items
- Premium will be earned on cost of capital
Sales: At EUR 9.3 billion, third-quarter sales increased 20%
compared with the weak third quarter of the previous year. Sales
volumes were increased significantly and sales prices were raised for
many of our products.
Factors influencing sales in
comparison with previous year
% 3rd Quarter Jan.-Sept.
Volumes 14 12
Price 10 3
Currencies (5) (4)
Acquisitions/divestitures 1 1
Total 20 12
Earnings: At EUR 1,054 million, income from operations (EBIT)
before special items climbed 162% compared with the same period of the
previous year.
In the Chemicals, Plastics and Performance Products segments,
earnings increased significantly due to higher sales volumes, higher
capacity utilization, as well as due to continued successful cost
management. In addition, it was possible to pass on the higher cost of
raw materials in the form of higher sales prices for many products in
our portfolio in this quarter. In the agricultural products business,
the further optimized product portfolio and lower costs led to a
significant improvement in earnings, which were negative in this
quarter due to the seasonal nature of the business. In the Oil & Gas
segment, higher crude oil prices and higher volumes in natural gas
trading resulted in higher earnings.
Special items for restructuring measures were primarily incurred
in the Chemicals and Agricultural Products & Nutrition segments.
EBIT after special items increased by 156% to EUR 958 million in
the third quarter. The financial result rose 14% to EUR (93) million.
Income before taxes and minority interests increased more than
threefold to EUR 865 million.
The tax rate was 56% compared with 54% in the same period of 2003.
Income taxes contain taxes for oil production that are noncompensable
with German corporate income tax. These oil production taxes amounted
to EUR 197 million compared with EUR 116 million in the third quarter
of 2003.
Net income climbed 181% to EUR 337 million compared with the third
quarter of 2003. At EUR 0.62, third-quarter earnings per share almost
tripled.
1st 2nd 3rd 4th
Special items Quarter Quarter Quarter Quarter
Million EUR 2004 2003 2004 2003 2004 2003 2004 2003
Special items
- in income from
operations (100) (2) (16) (58) (96) (29) (246)
- in financial
result (21) - (1) (3) (16) (27) (133)
Total (121) (2) (17) (61) (112) (56) (379)
Outlook: For the full year, we confidently expect a significant
increase in sales and EBIT before special items. We therefore
anticipate that we will earn a premium on our cost of capital. We are
continuing with our efforts to improve our productivity so that we can
meet the challenges of increasingly difficult international
competition and uncertain economic conditions.
Key BASF share data 3rd Quarter Jan. - Sept.
2004 2004
Share price (end of period)(a) EUR 47.45 EUR 47.45
High(a) EUR 47.65 EUR 47.65
Low(a) EUR 42.54 EUR 40.49
Average daily trade (number of
shares)(a) 2.36m 2.74m
BASF share performance(b) +7.9% +9.9%
DAX 30 performance(b) -3.9% -1.8%
EURO STOXX 50 performance(b) -2.7% +0.9%
(a) XETRA trading
(b) with dividends reinvested
Significant Events: On September 30, 2004 we signed a sales
agreement with CVC Capital Partners for the printing inks and printing
plates business, which is part of the Performance Chemicals division.
The completion of the transaction is scheduled for the fourth quarter
of 2004.
On October 4, 2004, we announced that we would increase our
current share buyback program by EUR 500 million to EUR 1 billion.
Chemicals
-- High capacity utilization due to continuing increase in
volumes
-- Higher raw materials costs partially passed on to the market
-- Highest increase in earnings of all segments
Overview 3rd Quarter January - September
Change Change
Million EUR 2004 2003 in % 2004 2003 in %
Sales 1,811 1,367 32 5,141 4,319 19
Thereof Inorganics 214 181 18 626 548 14
Petrochemicals 1,097 764 44 3,063 2,444 25
Intermediates 500 422 18 1,452 1,327 9
EBITDA 419 215 95 1,195 718 66
EBIT before special items 331 101 228 909 380 139
EBIT 302 99 205 858 370 132
Additions to fixed assets 107 142 (25) 414 396 5
Assets (end of period) 5,105 4,913 4 - - -
In the third quarter, sales rose significantly. Volumes and prices
were increased (volumes 18%, portfolio 5%, prices 14%, currencies
-5%). This led to higher earnings in all operating divisions.
Inorganics: Higher volumes in all business units led to an
increase in sales. Earnings also improved. Business benefited from a
noticeable upturn in important customer industries such as the
electronics and wood products industries.
Petrochemicals: Significantly higher volumes and the simultaneous
increase in prices resulted in higher sales in all product lines.
Sales growth was particularly high for cracker products, also as a
result of the weak third quarter in 2003. The cracker margin improved
despite a further increase in raw materials costs. High capacity
utilization of our plants contributed to earnings. Overall, the
Petrochemicals division made the greatest contribution to sales and
earnings growth.
Intermediates: Sales increased in all regions, with Asia showing
the strongest growth. Demand for amines increased in Europe. In North
America, growth within our polyalcohols business was particularly
strong. Earnings improved due to price increases and the rigorous
implementation of fixed-cost reduction measures.
Plastics
-- Significantly higher volumes and prices in all operating
divisions
-- Margins remain impacted by high raw materials prices
-- Business models and production further optimized
Overview 3rd Quarter January - September
Change Change
Million EUR 2004 2003 in % 2004 2003 in %
Sales 2,827 2,135 32 7,656 6,595 16
Thereof Styrenics 1,276 850 50 3,213 2,738 17
Performance
Polymers 644 547 18 1,906 1,667 14
Polyurethanes 907 738 23 2,537 2,190 16
EBITDA 268 185 45 813 602 35
EBIT before special items 158 67 136 480 253 90
EBIT 147 64 130 459 240 91
Additions to fixed assets 100 85 18 303 427 (29)
Assets (end of period) 6,231 5,964 4 - - -
Sales rose significantly as a result of higher volumes and prices
(volumes 15%, portfolio 1%, prices 22%, currencies -6%). Nevertheless,
the significantly higher sales prices compared with the same period of
2003 were unable to offset the massive increase in raw materials
prices since the beginning of the year. The increase in earnings was
due primarily to higher sales volumes, the continuing optimization of
our portfolio and the significant improvement in earnings in the
Performance Polymers division.
Styrenics: Prices for our products increased significantly against
a background of strong demand. Earnings improved significantly. Even
so, the extremely high price of benzene continued to have a negative
impact on margins. The startup of the new, highly efficient ABS plant
in Antwerp, Belgium, and the streamlining of the standard products
range are contributing toward reducing long-term costs.
Performance Polymers: Sales volumes of engineering plastics
increased. Sales prices for fiber intermediates and extrusion grades
were largely adjusted to reflect higher raw materials costs, but
pressure on margins for engineering plastics increased. Earnings rose
due to higher capacity utilization combined with lower fixed costs. In
order to meet rapidly growing demand in the automotive and electronic
industries for our high-performance plastic Ultrason(R), production
capacity at the site in Ludwigshafen, Germany, has been expanded by
20% to 6,000 metric tons per year.
Polyurethanes: Sales increased in all regions, mainly due to
higher volumes. Global demand for isocyanates in particular remains
strong. Significantly higher raw materials costs - in particular for
benzene, toluene and propylene - could only be partially offset in the
form of higher sales prices. Nevertheless, earnings improved due to
volume growth and cost reduction measures. In Korea, the production
capacity expansion at our MDI plant came on stream: Plant capacity has
been increased from 100,000 to 160,000 metric tons per year to meet
rising demand from our customers in Asia.
Performance Products
-- Higher sales volumes in all operating divisions
-- Earnings improve thanks to higher capacity utilization and a
reduction in fixed costs
-- Printing systems business sold
Overview 3rd Quarter January - September
Change Change
Million EUR 2004 2003 in % 2004 2003 in %
Sales 2,068 1,930 7 6,026 5,748 5
Thereof Performance
Chemicals 830 788 5 2,451 2,386 3
Coatings 516 500 3 1,541 1,509 2
Functional
Polymers 722 642 12 2,034 1,853 10
EBITDA 283 247 15 867 726 19
EBIT before special items 192 144 33 605 431 40
EBIT 190 135 41 593 414 43
Additions to fixed assets 58 59 (2) 187 157 19
Assets (end of period) 4,919 4,909 0 - - -
The sales growth in all operating divisions was primarily due to
higher sales volumes (volumes 9%, prices 1%, currencies -3%). Earnings
increased in all divisions as a result of higher capa-city utilization
and a reduction in fixed costs.
Performance Chemicals: Sales in all regions increased compared
with the third quarter of 2003. Sales growth was particularly strong
for performance chemicals for detergents and formulators as well as
for performance chemicals for coatings, plastics and specialties.
Earnings improved significantly compared with the previous year as a
result of lower fixed costs. With the announced sale of our printing
systems business we have further sharpened the strategic focus of our
portfolio.
Coatings: Higher sales volumes of automotive refinish coatings and
decorative paints led to a slight increase in sales. A significant
reduction in fixed costs had a particularly positive effect on
earnings in North America. At our site in Muenster, Germany, we have
opened a new distribution center that helps us supply our customers
even more efficiently.
Functional Polymers: Monomers and dispersions for decorative
paints recorded the strongest sales growth in years. Third-quarter
sales also increased significantly in the paper chemicals and
superabsorbents product groups, which grew only moderately in the
first half of the year. Earnings improved due to good capacity
utilization and higher prices that offset the rise in raw materials
prices to some extent. We have successfully launched our new latent
heat accumulator products Micronal(R) PCM in the European construction
materials market. As innovative additives to interior plaster and
wallboard these products improve the room climate and reduce energy
costs.
Agricultural Products & Nutrition
-- Earnings improve significantly in Agricultural Products
-- Fine Chemicals hit by lower sales prices
Overview 3rd Quarter January - September
Change Change
Million EUR 2004 2003 in % 2004 2003 in %
Sales 1,035 1,054 (2) 4,003 3,855 4
Thereof Agricultural
Products 591 585 1 2,645 2,469 7
Fine
Chemicals 444 469 (5) 1,358 1,386 (2)
EBITDA 65 17 282 797 685 16
EBIT before special items (36) (97) 63 474 349 36
Thereof Agricultural
Products (44) (120) 63 395 247 60
Fine
Chemicals 8 23 (65) 79 102 (23)
EBIT (66) (114) 42 419 303 38
Thereof Agricultural
Products (62) (138) 55 353 198 78
Fine
Chemicals (4) 24 . 66 105 (37)
Additions to fixed assets 54 51 6 156 1,237 (87)
Assets (end of period) 6,338 7,226 (12) - - -
Agricultural Products: Sales were at the previous year's level.
The positive effects of higher sales volumes were offset by currency
fluctuations and product divestitures (volumes 11%, portfolio -2%,
prices -1%, currencies -7%). Demand for our innovative fungicides
developed very positively in all important markets, in particular in
South America. Earnings improved significantly compared with the same
period of 2003, but were negative due to the seasonal nature of the
business. This improvement was primarily due to our successful
measures to optimize our portfolio and reduce costs.
Fine Chemicals: Lower sales prices, for example for lysine and
vitamin C, led to a decline in sales in a challenging competitive
environment (volumes 3%, prices -5%, currencies -3%). Business with
pharmaceutical active ingredients, cosmetics ingredients and aroma
chemicals developed positively. EBIT before special items was lower
than in the previous year, partly due to higher research and
development expenses. Earnings were negatively impacted by site
restructuring measures. We are proceeding with our program of capital
expenditures and restructuring measures to improve efficiency.
Oil & Gas
-- Earnings boosted by significant increase in crude oil prices
-- Natural gas trading successfully expanded
Overview 3rd Quarter January - September
Change Change
Million EUR 2004 2003 in % 2004 2003 in %
Sales 1,163 927 25 3,647 3,338 9
Thereof natural gas trading 520 422 23 1,893 1,756 8
EBITDA 578 342 69 1,444 1,178 23
EBIT before special items 458 271 69 1,140 953 20
Thereof natural gas trading 89 36 147 245 192 28
EBIT 458 271 69 1,147 953 20
Thereof natural gas trading 89 36 147 245 192 28
Additions to fixed assets 109 73 49 244 170 44
Assets (end of period) 3,743 3,471 8 - - -
Sales and earnings were positively affected by higher oil prices
and higher volumes in gas production and gas trading (volumes 18%,
prices/currencies 7%).
In exploration and production, gas production was considerably
increased. This was primarily due to a significant increase in
production in the Dutch North Sea and in Argentina. Production of oil
and condensate was at approximately the same level as in the previous
year. Overall, earnings again increased significantly as a result of
high oil prices.
In natural gas trading, sales volumes rose significantly. We
gained further customers in Germany. Supplies to customers in Austria
started for the first time. In addition, agreements were signed with
customers in the United Kingdom for supplies starting in October.
Earnings doubled, as a result of the business expansion, and due to a
one-time payment from an arbitration settlement. An innovative
conditioning plant for natural gas was put into operation together
with the municipal utility company of Bielefeld, Germany. This plant
will mix gas of various qualities and make it possible to supply the
local pipeline network. This model will allow access to additional
regional markets in Germany.
Regions
-- Sales and earnings increase in all regions
-- Europe improves significantly due to an upturn in business and
successful restructuring
EBIT before special
Sales Sales items
(location of (location of (location of
Overview customer) company) company)
Change Change Change
Million EUR 2004 2003 in % 2004 2003 in % 2004 2003 in %
3rd Quarter
Europe 4,962 4,225 17 5,357 4,522 18 776 288 169
Thereof
Germany 1,728 1,513 14 3,610 3,145 15 526 210 150
North
America
(NAFTA) 2,058 1,637 26 2,042 1,656 23 78 (22) .
South
America 613 537 14 528 461 15 86 77 12
Asia,
Pacific
Area,
Africa 1,681 1,341 25 1,387 1,101 26 114 60 90
9,314 7,740 20 9,314 7,740 20 1,054 403 162
January -
September
Europe 15,348 14,104 9 16,523 15,027 10 2,545 1,812 40
Thereof
Germany 5,515 5,161 7 11,141 10,413 7 1,784 1,352 32
North
America
(NAFTA) 6,207 5,573 11 6,164 5,595 10 362 59 .
South
America 1,471 1,227 20 1,220 1,021 19 204 160 28
Asia,
Pacific
Area,
Africa 4,653 3,917 19 3,772 3,178 19 278 148 88
27,679 24,821 12 27,679 24,821 12 3,389 2,179 56
Sales by location of company increased by 18% in the third quarter
in Europe and by 15% in Germany. EBIT before special items climbed EUR
488 million to EUR 776 million. This was due in particular to the
upturn in business and successful restructuring in the Chemicals and
Plastics segments, as well as the contribution of the Oil & Gas
segment.
In North America, sales by location of company increased by 34% in
dollar terms. All segments improved sales and EBIT, and growth was
strongest in the Petrochemicals division due to the high steam cracker
capacity utilization and the acquisition of the plasticizers business.
EBIT before special items increased by EUR 100 million to EUR 78
million as a result of higher sales volumes and lower costs.
In South America, sales by location of company rose 26% in local
currency terms. In particular, business with agricultural products
contributed to this growth. EBIT before special items increased by 12%
to EUR 86 million.
Companies in the Asia, Pacific Area, Africa region increased sales
in local currency terms by 35%. The Plastics segment in particular
benefited from strong demand. EBIT before special items almost doubled
to EUR 114 million.
Finance
-- High cash flow from operating activities
-- Almost EUR 500 million spent on share buybacks
Consolidated Statements of Cash Flows January - September
Million EUR 2004 2003
Net income 1,486 757
Depreciation and amortization of fixed assets 1,738 1,769
Changes in net working capital 437 798
Miscellaneous items 57 231
Cash provided by operating activities 3,718 3,555
Payments related to tangible and intangible
fixed assets (1,358) (1,452)
Acquisitions/divestitures 5 (1,456)
Financial investments and other items (298) (229)
Cash used in investing activities (1,651) (3,137)
Proceeds from capital increases/(decreases) (548) (400)
Changes in financial indebtedness (220) 1,442
Dividends (825) (831)
Cash provided by (used in) financing activities (1,593) 211
Net changes in cash and cash equivalents 474 629
Cash and cash equivalents as of beginning of
year and other changes 539 229
Cash and cash equivalents 1,013 858
Marketable securities 518 396
Liquid funds 1,531 1,254
Cash provided by operating activities rose 5% to EUR 3,718 million
in the first three quarters. This was primarily due to the higher
level of net income. Net working capital was reduced despite the
expansion of our business.
Cash used in investing activities led to a cash outflow of EUR
1,651 million compared with EUR 3,137 million in 2003. In the previous
year, more than EUR 1.4 billion was spent on acquisitions. At EUR
1,358 million, payments related to tangible and intangible fixed
assets were significantly lower than the level of amortization and
depreciation on fixed assets of EUR 1,738 million.
In cash used for financing activities, dividend payments and share
buybacks led to a cash outflow of EUR 1,593 million. In the first
three quarters of 2004, 11.5 million shares were bought back for EUR
492 million or an average of EUR 42.85 per share.
Liquid funds increased to EUR 1,531 million, and at EUR 3,427
million financial indebtedness declined compared with the figure at
the end of 2003. Net debt therefore declined by 34% to EUR 1,896
million.
Interim Financial Statements of BASF Group
(abridged version)
The interim financial statements have not been audited. The
valuation methods as used in the Consolidated Financial Statements for
2003 remain unchanged. Effective January 1, 2004, the U.S. dollar was
defined as the functional currency for companies in Malaysia and
Singapore as a result of the increased volume of business from local
production. There were only minor changes in the scope of
consolidation in the first nine months of 2004.
Consolidated Statements
of Income 3rd Quarter January - September
Change Change
Million EUR 2004 2003 in % 2004 2003 in %
Sales, net of natural gas
taxes 9,314 7,740 20.3 27,679 24,821 11.5
Cost of sales 6,505 5,502 18.2 18,914 17,255 9.6
Gross profit on sales 2,809 2,238 25.5 8,765 7,566 15.8
Selling expenses 1,133 1,122 1.0 3,402 3,366 1.1
General and
administrative expenses 182 173 5.2 535 509 5.1
Research and development
expenses 308 304 1.3 843 842 0.1
Other operating income 61 64 (4.7) 264 256 3.1
Other operating expenses 289 329 (12.2) 1,072 1,015 5.6
Income from operations 958 374 156.1 3,177 2,090 52.0
(Expenses)/income from
financial assets (25) (40) 37.5 (7) (93) 92.5
Interest result (68) (68) 0.0 (169) (206) 18.0
Financial result (93) (108) 13.9 (176) (299) 41.1
Income before taxes and
minority interests 865 266 225.2 3,001 1,791 67.6
Income taxes 482 143 237.1 1,403 995 41.0
Minority interests 46 3 . 112 39 187.2
Net income 337 120 180.8 1,486 757 96.3
Earnings per share (EUR ) 0.62 0.21 195.2 2.70 1.34 101.5
Number of shares in
millions, weighted 546 561 (2.7) 551 563 (2.1)
Consolidated Balance
Sheets
Sept. 30,Sept. 30,Change Dec. 31, Change
Million EUR 2004 2003 in % 2003 in %
Assets
Intangible assets 3,572 4,027 (11.3) 3,793 (5.8)
Property, plant and
equipment 12,995 13,503 (3.8) 13,070 (0.6)
Financial assets 2,464 3,048 (19.2) 2,600 (5.2)
Fixed assets 19,031 20,578 (7.5) 19,463 (2.2)
Inventories 4,501 4,630 (2.8) 4,151 8.4
Accounts receivable, trade 5,792 5,123 13.1 4,954 16.9
Miscellaneous receivables 3,062 3,021 1.4 3,159 (3.1)
Deferred taxes 1,311 1,151 13.9 1,247 5.1
Liquid funds 1,531 1,254 22.1 628 143.8
Current assets 16,197 15,179 6.7 14,139 14.6
Total assets 35,228 35,757 (1.5) 33,602 4.8
Stockholders' equity and
liabilities
Subscribed capital and capital
surplus 4,412 4,408 0.1 4,408 0.1
Retained earnings and other
equity 11,330 11,350 (0.2) 11,083 2.2
Minority interests 355 389 (8.7) 388 (8.5)
Stockholders' equity 16,097 16,147 (0.3) 15,879 1.4
Provisions for pensions and
similar obligations 3,890 3,894 (0.1) 3,862 0.7
Provisions for taxes and other
provisions 5,965 5,319 12.1 5,325 12.0
Provisions 9,855 9,213 7.0 9,187 7.3
Financial indebtedness 3,427 5,097 (32.8) 3,507 (2.3)
Accounts payable, trade 2,599 2,081 24.9 2,056 26.4
Other liabilities 3,250 3,219 1.0 2,973 9.3
Liabilities 9,276 10,397 (10.8) 8,536 8.7
Total liabilities 19,131 19,610 (2.4) 17,723 7.9
Total stockholders' equity and
liabilities 35,228 35,757 (1.5) 33,602 4.8
Consolidated Statements of Stockholders' Equity
January-September 2004 Currency
trans- Minor-
Sub- Re- lation ity Stock-
Million Number of scribed Capital tained adjust- inter- holders'
EUR shares capital surplus earnings ment ests equity
As of
January
1, 2004 556,643,410 1,425 2,983 12,055 (972) 388 15,879
Net income - - - 1,486 - 112 1,598
Share
buyback
and
cancell-
ation of
shares
including
own
shares
intended
to be
cancelled(11,493,000) (29) 29 (492) - - (492)
Dividends
paid - - - (774) - (51) (825)
(Decrease)
/increase
of foreign
currency
trans-
lation
adjust-
ments - - - - 11 (65) (54)
Capital
injection
by
minority
interests - - - - - (60) (60)
Changes in
scope of
consolid-
ation
and other
changes - - 4 16 - 31 51
As of
September
30, 2004 545,150,410 1,396 3,016 12,291 (961) 355 16,097
Consolidated Statements of Stockholders' Equity
January - September 2003 Currency
trans- Minor-
Sub- Re- lation ity Stock-
Million Number of scribed Capital tained adjust- inter- holders'
EUR shares capital surplus earnings ment ests equity
As of
January
1, 2003 570,316,410 1,460 2,948 12,468 (330) 396 16,942
Net income - - - 757 - 39 796
Share
buyback
and
cancell-
ation of
shares
including
own
shares
intended
to be
cancelled(11,255,000) (28) 28 (400) - - (400)
Dividends
paid - - - (789) - (42) (831)
(Decrease)
/increase
of foreign
currency
trans-
lation
adjust-
ments - - - - (345) (6) (351)
Changes in
scope of
consolid-
ation
and other
changes - - - (11) - 2 (9)
As of
September
30, 2003 559,061,410 1,432 2,976 12,025 (675) 389 16,147
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 Annual Report on Form 20-F is available on the
Internet at www.basf.com.) We do not assume any obligation to update
the forward-looking statements contained in this report.
Publisher:
BASF Aktiengesellschaft
Corporate Department
Communications BASF Group
67056 Ludwigshafen
Germany
You can find HTML versions of this
and other publications from BASF
on our homepage at www.basf.com.
You can also order reports:
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Important dates
-- March 9, 2005
Financial Results 2004
-- April 28, 2005
Annual Meeting, Mannheim
Interim Report First Quarter 2005
-- August 3, 2005
Interim Report Second Quarter 2005
-- November 10, 2005
Interim Report Third Quarter 2005
CONTACT: BASF Aktiengesellschaft
Corporate Media Relations
Michael Grabicki
Phone: +49 621 60-99938
Fax: +49 621 60-92693
michael.grabicki@basf-ag.de
or
Investor Relations
Magdalena Moll
Phone: +49 621 60-48230
Fax: +49 621 60-22500
E-mail: investorrelations@basf-ag.de
or
General inquiries
Phone: +49 621 60-0
Fax: +49 621 60-42525
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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
Date: November 11, 2004 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