By Helena Smolak
German chemical giant BASF stuck to its outlook after first-quarter results but said it was difficult to assess the impact of tariffs at this point.
The company warned of a high level of uncertainty due to volatility stemming from tariff announcements and the unpredictability of further U.S. decisions and potential reactions from trading partners.
However, BASF said it expected to be insulated from the direct impact of tariffs because it produces the majority of its products locally. In 2024, more than 80% of its U.S. sales were generated from products made domestically, it said.
"This high proportion of local production is the reason why the direct impact of tariffs on BASF is likely to be limited," Chief Financial Officer Dirk Elvermann.
However, indirect effects from tariffs such as changes in customer demand are currently difficult to estimate, he said as the company posted its first-quarter results Friday.
Earnings before interest and taxes, depreciation, amortization and special items--its preferred metric--fell 3.2% on year to 2.625 billion euros ($2.96 billion) in the period, but topped analysts' estimates of 2.48 billion euros, according to a company-compiled consensus. Its Surface Technologies unit was the only segment to post an increase in earnings.
Group sales fell to 17.40 billion euros from 17.55 billion euros, missing analysts' expectations of 17.60 billion euros as demand slowed at its Agricultural Solutions, Chemicals and Nutrition and Care segments, while lower prices across nearly all of its business couldn't offset foreign-currency moves. Sales rose in Europe, in the Asia Pacific region but declined in South America, Africa, Middle East and North America.
Net profit declined 41% to 808 million euros, partly dragged by one-off charges of 300 million euros related to its withdrawal from the Nordlicht wind farm project in the North Sea.
For the year, BASF still expects Ebitda before special items of between 8.0 billion and 8.4 billion euros compared with 7.86 billion euros last year, and free cash flow at between 0.4 billion and 0.8 billion euros compared with 748 million euros in 2024.
Write to Helena Smolak at helena.smolak@wsj.com
(END) Dow Jones Newswires
May 02, 2025 01:52 ET (05:52 GMT)
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