MOSCOW (MRC) - Germany's BASF expects a slide in earnings at its Wintershall oil and gas unit brought on by lower oil prices to cancel out gains at its basic petrochemicals and crop protection businesses this year, said the company in its press release.
Crude oil prices have recovered from a six-year low reached earlier this year, but average prices over the first quarter were more than 45 percent below year-earlier levels.
The world's largest chemicals firm by sales on Thursday affirmed its forecast for 2015 operating profit to stagnate while sales will rise slightly.
Its earnings before interest and tax (EBIT), adjusted for one-off items, slipped 2 percent in the first quarter through March as an increase in its share price forced BASF to set aside more money for an employee incentive programme.
Adjusted EBIT came to 2.07 billion euros (USD2.3 billion), still slightly better than the 2.0 billion expected by analysts in a Reuters poll.
The company, whose products include car coatings, foam chemicals, catalytic converters and mining chemicals, said its revenues rose 2.8 percent to 20.1 billion euros, boosted by a weak euro that countered the effect of lower volumes in industrial chemicals.
Sales volumes were up 5 percent, lifted by demand for pesticides in western Europe and North America. Also, prices for agricultural products were up 4 percent.
"Contrary to what we've seen from Syngenta, Dow Chemical and DuPont," Morgan Stanley analysts said in a note, comparing BASF's results with those of rivals. "The best we've seen so far."
Quarterly net income fell 20 percent to 1.17 billion euros, below average expectations for 1.27 billion.
Shares in BASF were up 0.2 percent at 89.27 euros by 0858 GMT, in line with Germany's blue-chip DAX index.
As MRC informed earlier, in 2014, BASF posted sales of EUR74.3 billion and income from operations before special items of about EUR7.2 billion. The company is currently expanding its international activities with a particular focus on Asia.
BASF is the world’s leading chemical company. Its portfolio ranges from chemicals, plastics, performance products and crop protection products to oil and gas. BASF had sales of about EUR74 billion in 2013 and over 112,000 employees as of the end of the year.
MRC