MOSCOW (MRC) -- Quarterly operating earnings at BASF, the world's largest chemicals company by sales, rose slightly less than expected, as a strong euro lowered the value of overseas sales, as per the company's press release.
Second-quarter earnings before interest and tax (EBIT), adjusted for one-off items, rose 12.1% to 2.05 billion euros (USD2.76 billion).
Sales and net income also narrowly missed consensus estimates, also hurt by an outage due to an accident at a Dutch plastics raw materials plant, run jointly with Shell.
The shares were seen 0.6% lower in pre-market trade, while Germany's blue-chip index was indicated flat from Wednesday's close.
"The devaluation of almost all major currencies against the euro negatively impacted earnings by roughly 200 million euros compared to the previous second quarter," said Chief Executive Kurt Bock in a statement.
The euro was up more than 5% against the U.S. dollar on average over the quarter.
Earnings at its core chemicals and plastics businesses as well as at its oil and gas unit rose faster than analysts had expected, helped by higher sales of petrochemicals in North America and increased offshore oil production in Libya.
The German group said that despite unfavourable currency developments, it continued to target a slight increase in adjusted EBIT in 2014 but warned that the economic environment had become more challenging.
BASF reiterated that it aimed to increase sales volumes excluding the effects of acquisitions and asset sales but that revenues would decline slightly due to the divestment of its gas trading and storage business.
BASF is the largest diversified chemical company in the world and is headquartered in Ludwigshafen, Germany. BASF produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries. BASF had sales of about EUR74 billion in 2013 and over 112,000 employees as of the end of the year.
MRC