BASF Expects Narrowed Net Loss, Outlook In Focus -- Earnings Preview

Dow Jones02-27

By Helena Smolak

BASF is scheduled to report results for the fourth quarter and the full year on Friday. Here is what you need to know:

NET PROFIT FORECAST: The German chemical company is expected to report a net loss of 481.5 million euros ($506.3 million) in the fourth quarter compared with a net loss of 1.6 billion euros for the comparable period a year earlier, according to a company-compiled consensus.

2024 RESULTS: BASF reported last month preliminary numbers for earnings before interest, taxes, depreciation and amortization before special items----the company's preferred metric, which strips out exceptional and other one-off items-- for the year at 7.9 billion euros, compared with 7.7 billion in 2023, on sales that fell 5.2% to 65.3 billion euros.

The company said the analyst consensus for full-year net profit of 2.2 billion euros, compared with 225 million euros a year before, won't be achieved as it expects to book a 1.9 billion-euro impairment, driven mainly by battery materials in the surface-technologies segment and restructuring costs.

Shares in BASF are up 16% since the start of the year and rose 6.6% in the past 12 months.

WHAT TO WATCH:

-- OUTLOOK: Investors' key focus will be on BASF's outlook as some uncertainties persist over potential early orders for its agricultural business in the last quarter that could lower demand in the first quarter this year, Baader Helvea Equity Research analyst Konstantin Wiechert said in a note. MWB Research analyst Abed Jarad anticipates BASF to forecast low single-digit revenue growth for 2025.

--COATINGS BUSINESS: Investors are closely monitoring BASF's further strategic steps with its coatings business, which could be split into three separate businesses--automotive coatings, surface treatment and refinish coatings--the Baader Helvea analyst said. A divestment of all parts could generate proceeds in the range of 5.7 billion euros-7.3 billion euros, Baader Helvea said. In February, the company agreed to sell its Brazilian decorative paint business to U.S. paints and coatings firm Sherwin-Williams.

Write to Helena Smolak at helena.smolak@wsj.com

(END) Dow Jones Newswires

February 26, 2025 11:14 ET (16:14 GMT)

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BASF Expects Narrowed Net Loss, Outlook In Focus -- Earnings Preview

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