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BASF Group in second quarter 2025: Sales almost at prior-year quarter level on slight volume growth; EBITDA before special items slightly lower

30.07.2025 08:24 "Agro Perspectiva" (Kyiv) — • Higher earnings in Agricultural Solutions, Surface Technologies and Nutrition & Care; ongoing margin pressure in base chemicals businesses

• Adjusted outlook: EBITDA before special items now expected to be between ˆ7.3 billion and ˆ7.7 billion

• Annual Shareholders’ Meeting to be held in person in alternating years

In the second quarter of 2025, BASF generated EBITDA before special items of around ˆ1.8 billion. «The Agricultural Solutions segment recorded significantly higher earnings and achieved remarkable volume growth of 21 percent compared with the prior-year quarter,» said Dr. Markus Kamieth, Chairman of the Board of Executive Directors of BASF, presenting the quarterly figures together with Chief Financial Officer Dr. Dirk Elvermann. The Surface Technologies and Nutrition & Care segments achieved slightly higher earnings. In the base chemicals businesses, margins remained under pressure due to high product availability on the market.

BASF Group’s sales in the second quarter of 2025 amounted to ˆ15.8 billion, ˆ342 million below the level of the prior-year period. The main drivers of this development were negative currency effects as well as lower prices. The decline in prices was largely attributable to the Chemicals segment, whereas prices improved in the Surface Technologies and Nutrition & Care segments. Positive volume growth in the Agricultural Solutions, Surface Technologies and Materials segments partially offset the decline in sales.

Compared with the prior-year quarter, income from operations before depreciation, amortization and special items (EBITDA before special items) decreased by ˆ185 million to ˆ1.8 billion. This was mainly due to the considerable earnings decline in the Chemicals segment resulting largely from lower margins. The Industrial Solutions and Materials segments also recorded an earnings decline. By contrast, Agricultural Solutions in particular, but also Surface Technologies achieved earnings growth. The Nutrition & Care segment also recorded an earnings increase. EBITDA before special items in Other fell considerably compared with the prior-year quarter. The EBITDA margin before special items was 11.2 percent following 12.1 percent in the prior-year quarter.

EBITDA amounted to ˆ1.5 billion following ˆ1.6 billion in the prior-year period. In the second quarter of 2025, EBITDA included special items in the amount of minus ˆ297 million. Special charges resulted primarily from structural measures in connection with cost saving programs. At ˆ494 million, EBIT was ˆ22 million below the prior-year quarter’s figure. The ˆ112 million decline in net income from shareholdings was primarily due to negative earnings contributions from Wintershall Dea GmbH and Harbour Energy plc. The financial result improved by ˆ52 million compared with the prior-year quarter to minus ˆ106 million. Accordingly, income before income taxes amounted to ˆ316 million, ˆ82 million below the prior-year quarter’s figure. Net income was ˆ79 million, compared with ˆ430 million in the prior-year quarter.

Development of cash flows in the second quarter of 2025

Cash flows from operating activities totaled ˆ1.6 billion in the second quarter, ˆ365 million below the prior-year quarter’s figure. The main reason for the decrease was the change in trade accounts payable. Compared with the prior-year quarter, cash flows from investing activities improved considerably by ˆ1.0 billion to minus ˆ1.1 billion. This was primarily due to lower payments made for property, plant and equipment and intangible assets, which at ˆ1.1 billion, were ˆ428 million lower than in the prior-year quarter. «We have now passed the peak investment phase for our South China Verbund site and thus our cash performance will improve accordingly,» said Elvermann. Free cash flow, which is the cash flows from operating activities less payments made for property, plant and equipment and intangible assets, was ˆ533 million in the second quarter of 2025, an increase of ˆ62 million compared with the prior-year period.

BASF Group’s business development in the first half of 2025

Compared with the first half of 2024, BASF Group sales in the first half of 2025 decreased by ˆ493 million to ˆ33.2 billion. The decline was due to negative price developments in four of the six segments, particularly in the Chemicals segment. The Nutrition & Care and Surface Technologies segments recorded a rise in prices. Currencies developed negatively in all segments. Volumes rose, mainly in the Surface Technologies and Agricultural Solutions segments.

The BASF Group’s EBITDA before special items decreased by ˆ272 million in the first half of 2025 and amounted to ˆ4.4 billion. This was mainly attributable to declines in the Chemicals segment. EBITDA was ˆ3.7 billion, compared with ˆ4.2 billion in the prior-year period. At ˆ1.7 billion, EBIT was down ˆ515 million from the prior-year period. Net income was ˆ887 million, compared with ˆ1.8 billion in the prior-year period.

Development of cash flows in first half 2025

Cash flows from operating activities amounted to ˆ603 million in the first half-year, ˆ834 million below the prior-year period’s figure. Net cash outflow in cash flows from investing activities decreased considerably by ˆ1.2 billion compared with the prior-year period to minus ˆ1.8 billion. This was primarily due to the ˆ554 million decrease in payments made for property, plant and equipment and intangible assets, especially in connection with construction of the Verbund site in Zhanjiang, China. Free cash flow was minus ˆ1.3 billion in the first half of 2025, compared with minus ˆ986 million in the prior-year period.

Format of Annual Shareholders’ Meeting to alternate annually

On the basis of the positive experience with the first virtual Annual Shareholders’ Meeting, BASF’s Board of Executive Directors decided to annually alternate the format of the Annual Shareholders’ Meeting of BASF SE over the next four years. The Annual Shareholders’ Meeting will be held in person again in 2026 and 2028. The proven virtual format will be used in 2027 and 2029. «This decision was made to meet the different expectations of our diversified investor base,» said Kamieth.

BASF Group outlook for 2025

Due to ongoing macroeconomic and geopolitical uncertainties, BASF has adjusted its assumptions for the full year 2025. According to current estimates, global gross domestic product will grow less rapidly in 2025 than previously expected. Growth is expected to weaken across all major economic regions in the second half of the year. Following the U.S. dollar’s significant depreciation against the euro, it is expected to remain at the same level as at the end of the first half of the year. Global industrial production will also see slowed growth according to current estimates. As a result, the rise in market demand for chemical products will not be as significant in 2025 as previously expected. Margins, particularly in the upstream sector, remain under pressure due to sustained high product availability in the market.

Accordingly, BASF has adjusted its assumptions regarding the global economic environment for 2025 as follows (previous assumptions from the BASF Report 2024 are in parentheses; current assumptions are rounded):

• Growth in gross domestic product: 2.0 percent to 2.5 percent (2.6 percent)

• Growth in industrial production: 1.8 percent to 2.3 percent (2.4 percent)

• Growth in chemical production: 2.5 percent to 3.0 percent (3.0 percent)

• Average euro/dollar exchange rate of $1.15 per euro ($1.05 per euro)

• Average annual oil price (Brent crude) of $70 per barrel ($75 per barrel)

The BASF Group’s forecast for the 2025 business year published in the BASF Report 2024 was also partially adjusted (previous forecast from the BASF Report 2024 is in parentheses if changed):

• EBITDA before special items of between ˆ7.3 billion and ˆ7.7 billion (ˆ8.0 billion to ˆ8.4 billion)

• Free cash flow of between ˆ0.4 billion and ˆ0.8 billion

• CO2 emissions of between 16.7 million metric tons and 17.7 million metric tons

The volatility of the tariff announcements and the unpredictability of other decisions by the United States government as well as possible countermeasures by trading partners are causing a high level of uncertainty. Thanks to our global strategy of serving customers through local production in their respective markets, the direct impact of the tariffs remains limited. However, there are indirect effects, particularly associated with demand for our products and their prices. This is mainly due to intensified competitive pressure and rising inflation. It is still not possible to fully assess the resulting effects.

Agro Perspectiva

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