Despite reporting financials overshadowed by the pandemic woes, BASF, one of the leading chemical giants in the global market, has revealed its fourth quarter results indicating a V-shaped recovery in its quarterly performance.
As per the preliminary figures, BASF has registered a net gain by around 8.5 per cent in the overall sales for the final quarter of 2020 corresponding to the same quarter in the previous year. The exact sales figure reported by the company is USD 19.3 billion for the fourth quarter of 2020. Earnings before taxes (EBIT) has also outperformed the consensus, by registering a tremendous gain of 32.2% to USD 1.3 billion over the corresponding period in the previous year. However, the company has preferred to reserve its major insights for the quarter till it reveals its final results on 26th February.
Despite a marginal slump observed in the earnings of almost all segments in the span of full year, its chemicals, materials and industrial solutions segments have revived in the fourth quarter of 2020. Whereas performance of its agricultural segment remained pressured on quarter-on-quarter basis. The company in its last quarterly update revealed that the demand from its food and personal care products which was seen humming in the first half of 2020, normalized in the third quarter.
Amidst the pandemic uncertainties, BASF has re-evaluated some of its upcoming projects at risk while it has continued to expand its foothold in the global chemicals market by undertaking the projects that are more likely to consolidate a heavy revenue in the long term. In November end, BASF announced the completion of its plastic additive plant for the agriculture industry. However, the German chemicals manufacturer decided to temporarily stall the work at its India’s joint chemical complex including a Polypropylene production unit, propane dehydrogenation plant (PDH) and a complex having acrylics value chain.
ChemAnalyst predicts that, since demand for chemicals in the electronics industry and home construction is anticipated to turn firmer, BASF along with other manufacturers dealing with production of application specific chemicals are perceived to attain a considerable profit in H1 of 2021. However, the overall revenue from automotive will still take a longer time to reach the pre-pandemic levels.