BASF awaits upswing
15 Jan 2000
Half-year profits at BASF slumped by over a third, to E932million, as the company took a E210million charge for fines arising from the US vitamin price cartel scandal. Despite this, the company says, income from operations rose, and BASF is `in a good position for the onset of the economic upswing'.
Chairman Jurgen Strube said that the company deeply regretted the vitamin business's involvement in the price-fixing cartel, which also involved Hoffmann-La Roche. The board has installed a new management team and is beginning to rebuild relationships with customers and investors, he added.
The interim results were boosted by `clear improvements' in the second quarter following a very week first three months. Sales across all segments were higher than in the first quarter, with improvements over last year everywhere apart from the cyclically-pressurised chemicals division. Sales in plastics should be strong for the rest of the year, Strube predicted, with demand rising from customers in the automotive and electrical industries.
In the UK, BASF saw pricing pressures cut sales by 6 per cent, to £437million. Turnover in plastics, fibres and chemicals fell sharply, although prices began to recover. Colours and finishing products saw improved sales volumes, and crop protection also saw upswings.
