Slide 1: Virtual Conference for Analysts and Investors
Virtual Conference for Analysts and Investors FY 2022 Reporting and Investor Update February 24, 2023
Slide 2: Cautionary note regarding forward-looking statements
Cautionary note regarding forward-looking statements This presentation contains forward-looking statements. These statements are based on current estimates and projections of the Board of Executive Directors and currently available information. Forward-looking statements are not guarantees of the fu
Slide 3: Agenda
Agenda 1. Full-year 2022 reporting 2. Measures to increase competitiveness 3. Concluding remarks 3 February 24, 2023 | Virtual Conference for Analysts and Investors
Slide 4: Global chemical production grew by 2.2% in the full year 2022
Global chemical production grew by 2.2% in the full year 2022 and by only 1.0% in Q4 2022 Chemical production compared with prior year1 % North America EU Mainland China Asia excl. mainland China 6.1 6.3 1.6 1.8 10.7 7.7 6.6 -3.1 -5.8 -2.8 -15.7 -8.9 2021 2022 Q4 2022 2021 2022 Q4 2022 2021 2022 Q4
Slide 5: Q4 2022: Sales decreased slightly, mainly due to lower volumes
Q4 2022: Sales decreased slightly, mainly due to lower volumes Sales bridge Q4 2022 vs. Q4 2021 Million € 25,000 Sales decreased by 2.3% to €19,323 million 20,000 19,776 890 19,323 Volumes declined by 15.4% 1,812 -116 − Agricultural Solutions increased volumes slightly, 15,000 -3,039 all other s
Slide 6: Q4 2022: BASF's EBIT before special items declined primarily due to lower upstream contributions
Q4 2022: BASF’s EBIT before special items declined primarily due to lower contributions from the upstream segments BASF Industrial Surface Nutrition Agricultural BASF Group Chemicals Materials Solutions Technologies & Care Solutions Other Group EBIT before special items Q4 2022 vs. Q4 2021 Million €
Slide 7: BASF Group Q4 2022 and full year 2022: Financial figures
BASF Group Q4 2022 and full year 2022: Financial figures Financial figures Q4 2022 Change FY 2022 Change Million € % Million € % Sales 19,323 -2.3 87,327 11.1 EBITDA before special items 1,401 -35.7 10,762 -5.2 EBITDA 1,389 -38.3 10,748 -5.3 EBIT before special items 373 -69.6 6,878 -11.5 EBIT 119 -
Slide 8: Competitiveness in Europe declined – negative operational earnings in Germany in 2022
Competitiveness in Europe declined – negative operational earnings in Germany in 2022 EBIT before special items of BASF Group Billion € 7.8 In 2015, Germany, Europe excluding Germany, and the other regions each contributed around 6.7 one-third 3.3 2.0 5.2 In 2021, Europe including Germany contri
Slide 9: In the full year 2022, BASF incurred €3.2 billion higher costs for energy globally
In the full year 2022, BASF incurred €3.2 billion higher costs for energy globally Additional energy costs1 2022 vs. 2021 Full year 2022 compared with 2021: Billion € €3.2 billion higher energy costs globally 3.2 €2.2 billion related to higher natural gas costs globally 3.0 0.5 Rest of the world
Slide 10: Recent developments relating to Wintershall Dea AG
Recent developments relating to Wintershall Dea AG Recent developments in Russia − Wintershall Dea has been economically expropriated in Russia − Wintershall Dea has practically no longer any possibility of exerting influence on its holdings in Russia Wintershall Dea’s decision to fully exit Rus
Slide 11: Strong operating cash flow in Q4 2022 lifted full-year free cash flow to more than €3.3 billion
Strong operating cash flow development in Q4 2022 lifted full-year free cash flow to more than €3.3 billion Q4 2022 FY 2022 Q4 2022 vs. Q4 2021 Million € Million € Cash flows from operating activities increased by €1.1 billion to €4.5 billion Changes in net working capital led to a cash inflow o
Slide 12: BASF Group 2022: Overview of financial and non-financial targets
BASF Group 2022: Overview of financial and non-financial targets 2022 2022 target status >2.2% –7.0% Grow sales volumes faster than global chemical production every year +3–5% –5.2% Increase EBITDA before special items by 3% to 5% per year >9% 10.0% Achieve a return on capital employed (ROCE)1 consi
Slide 13: Attractive shareholder return – also in challenging times
Attractive shareholder return – also in challenging times Dividend per share € 4.00 Proposal 3.30 3.30 3.40 3.40 3.10 3.20 Key facts 2022 2.90 3.00 3.00 2.70 2.80 Dividend proposal to Annual Shareholders’ Meeting of €3.40 per share 2.00 In total, we would pay out €3.0 billion2, which is fully co
Slide 14: Capex to support future organic growth will peak between 2023 and 2025
Capex to support future organic growth will peak between 2023 and 2025 Capex budget by type of investment Capex budget by type of investment Billion €, 2023–2027 Billion €, 2023–2027 Average capex Investments in Growth project: billion € p.a. existing business battery materials ~0.4 €28.8 billion, ~
Slide 15: Outlook 2023 for BASF Group
Outlook 2023 for BASF Group Outlook 2023 Sales €84 billion – €87 billion EBIT before special items €4.8 billion – €5.4 billion ROCE 7.2% – 8.0% CO2 emissions 18.1 – 19.1 million metric tons Underlying assumptions (prior-year figures in parentheses) Growth in gross domestic product: 1.6% (3.0%) G
Slide 16: Agenda
Agenda 1. Full-year 2022 reporting 2. Measures to increase competitiveness 3. Concluding remarks 16 February 24, 2023 | Virtual Conference for Analysts and Investors
Slide 17: Measures to increase competitiveness
Measures to increase competitiveness Adaptation Cost savings of Verbund program structures with focus in Ludwigshafen on Europe 17 February 24, 2023 | Virtual Conference for Analysts and Investors
Slide 18: Cost savings program with focus on Europe successfully started
Cost savings program with focus on Europe successfully started Expected cost savings by the end of 2024 Million € Annual cost savings of more than €500 million expected to be achieved in non- ~70 production areas by the end of 2024; roughly half of the savings to be realized at the Ludwigshafen si
Slide 19: Verbund site Ludwigshafen – Today
Verbund site Ludwigshafen – Today Energy Verbund Ludwigshafen Products Natural gas Base chemicals to the market Upstream Renewable energy BASF downstream sales products: ~8,000 Fossil raw materials for Europe and global market Downstream Renewable raw materials CO2 emissions Raw materials CO2 19 Feb
Slide 20: Thorough analysis of Verbund structures in Ludwigshafen over the last months
Thorough analysis of Verbund structures in Ludwigshafen over the last months Analyzed factors such as competitiveness Identified critical production cost Increase competitiveness structures and energy and CO2 intensity while ensuring continuity of interdependencies profitable businesses cont
Slide 21: Stepwise approach streamlines ammonia value chain
Stepwise approach streamlines ammonia value chain while limiting impact on profitable downstream businesses Ammonia value chain1 Rationale Reduce exposure to low-margin caprolactam export Glues & Resins market and rightsize caprolactam capacity to core European demand Ensure caprolactam supply t
Slide 22: Reduction in production scope for adipic acid safeguards profitable captive offtake
Reduction in production scope for adipic acid safeguards profitable captive offtake while enabling further asset optimization Adipic acid value chain1 Rationale Reduce exposure to low-margin adipic acid merchant market; focus on profitable business and enhance value Anolon Antwerp Hexanediol creat
Slide 23: Closure of TDI plant addresses sharp input cost increase and lower market growth
Closure of TDI plant addresses sharp input cost increase and lower market growth TDI value chain1 Rationale Weak demand development for TDI2 in Europe, Middle East, Africa over the past years Electrolysis Energy cost environment in Europe has further worsened the situation for TDI production in
Slide 24: Planned measures structurally improve competitiveness of Ludwigshafen site
Planned measures structurally improve the competitiveness of BASF’s Ludwigshafen site and contribute to net-zero target Affected production assets Fixed cost reduction Natural gas demand >€200 million -4.8 10% of the asset replacement value at the site TWh/a per year (~15% of 2021) Expected affected
Slide 25: Technical optimizations and substitution of natural gas lower shutdown threshold
Technical optimizations and substitution of natural gas significantly lower threshold at which the Ludwigshafen site must be shut down Gas supply threshold in % based on average consumption in 2021 Measures implemented in 2022 Optimized steering of the Production Verbund, ~50% e.g., using the by-p
Slide 26: Key pillars to transform the Ludwigshafen Verbund site to net zero by 2045
Key pillars to transform the Ludwigshafen Verbund site to net zero by 2045 Grey-to-green Power-to-steam Adapting BASF infrastructure for electricity and hydrogen New CO2-free technologies CCS1 for hard-to-abate CO2 streams Implement CCU2-based raw materials Increase proportion of renewable and recyc
Slide 27: Verbund site Ludwigshafen – Vision for the future
Verbund site Ludwigshafen – Vision for the future Energy Verbund Ludwigshafen Products Renewable energy Base chemicals to the market Upstream Emission-free hydrogen BASF downstream sales products: ~8,000 Fossil raw materials mainly for Europe Renewable and recycled Downstream raw materials Carbon ca
Slide 28: Measures to increase competitiveness
Measures to increase competitiveness Adaptation Cost savings of Verbund program structures with focus in Ludwigshafen on Europe 28 February 24, 2023 | Virtual Conference for Analysts and Investors
Slide 29: Agenda
Agenda 1. Full-year 2022 reporting 2. Measures to increase competitiveness 3. Concluding remarks 29 February 24, 2023 | Virtual Conference for Analysts and Investors
Slide 30: What BASF stands for
What BASF stands for Competitive advantages through flexible Verbund concept for integrated production Strategic focus on local production for local markets and We create on high-growth market segments, e.g., battery materials chemistry for a Industry leader in shaping the transformation to ne
Slide 31: We create chemistry
O- BASF We create chemistry