● Sales increased to EUR 23.1 billion (+19%)

● EBIT before special items amounted to EUR 2.8 billion (up 21%)

● The full-year outlook on 25 February 2022 remains unchanged

In the first quarter of 2022, energy and raw material prices rose significantly, and supply chain disruptions occurred frequently. "Nevertheless, we are off to a good start in 2022," said Dr. Martin Brudermüller, Chairman of the Executive Board of BASF Europe, at the company's annual general meeting held online. Preliminary data released.

Sales rose by 3.7 billion euros compared to the first quarter of last year to 23.1 billion euros. The increase in sales was mainly driven by higher prices, especially in the Chemicals and Materials businesses. Favorable currency factors in each business area also contributed to the sales performance. A slight decrease in overall sales was partially offset. Higher volumes in the Agricultural Solutions, Industrial Solutions, Materials, Nutrition & Care and Chemicals business areas were not able to fully offset the decline in the Surface Technology business areas.

EBIT before special items was EUR 2.8 billion, an increase of EUR 497 million, mainly due to significant earnings growth in the Chemicals segment. EBIT before special items also increased significantly in the Industrial Solutions, Materials and Nutrition & Care business areas. EBIT before special items in the Agricultural Solutions business area improved slightly. Earnings before interest and tax excluding special items in the surface treatment technology business area decreased significantly, mainly due to the impact of the decline in market demand in the automotive industry.

EBIT increased by EUR 474 million compared to the same period in the first quarter of 2021 to EUR 2.8 billion. Net income was 1.2 billion euros, compared with 1.7 billion euros in the same period last year. This was due to an impairment charge recognised by Wintershall Dea, for which BASF included a special charge of around EUR 1.1 billion in its net income proportional to its shareholding (72.7%). The impairments were triggered by the Ukrainian war and related political fallout and, in addition to the Nord Stream 2 loan, also involved assets located in Russia as well as those of the gas transportation business.

Operating cash flow improved in Q1 2022

Cash flow from operating activities was negative 290 million euros, an increase of 235 million euros compared to the same period last year. Although the proportion of cash used in net working capital has increased due to the increase in input costs and the sharp increase in sales, the improvement in operating performance is still the main reason for the increase in cash flow. Free cash flow improved by EUR 88 million to a negative EUR 893 million.

Proposed dividend of EUR 3.40 per share

At BASF's annual general meeting today, BASF's Executive Board and Supervisory Board will propose a dividend of EUR 3.40 per share for fiscal 2021. If the proposal is adopted by shareholders, BASF will pay a total of 3.1 billion euros on May 4, 2022. "Our strong free cash flow of 3.7 billion euros in 2021 is sufficient to cover this payment," Brudermüller said. The ex-dividend date is May 2, 2022, when BASF shares are traded at the share price minus the dividend amount.

BASF Group Outlook 2022

At present, there is great uncertainty about the global macroeconomic outlook, especially the unpredictable prospect of the war in Ukraine and its impact on energy and raw material prices and supplies.

As a result, BASF's current macroeconomic assumptions for fiscal 2022 remain unchanged.

● Global GDP growth: +3.8%

● Industrial production growth: +3.8%

● Chemical production growth: +3.5%

● Average price of EUR/USD: 1 EUR to 1.15 USD

● Brent crude oil averaged $75 a barrel

The BASF Group's forecast for fiscal 2022 sales and earnings remains unchanged, as in the BASF Group 2021 Performance Report.

● Sales are expected to be between EUR 74 billion and EUR 77 billion

● EBIT before special items is expected to be between EUR 6.6 billion and EUR 7.2 billion

● Return on capital employed (ROCE) expected to be between 11.4% and 12.6%

● Full-year 2022 CO2 emissions will be between 19.6 million and 20.6 million tons

Significant uncertainty will continue to dominate the market environment, with risks likely to come from further increases in raw material prices and new sanctions against Russia, such as a gas embargo, or Russia restricting gas supplies in response to sanctions. In addition, risks may also come from the future development of the new crown epidemic and the introduction of more permanent or new measures to control the number of infections, especially in China. Continued high profit margins may present opportunities.