Published by Global Banking & Finance Review®
Posted on February 28, 2025
2 min readLast updated: January 25, 2026
Add as preferred source on GoogleBASF targets cost savings and slight income growth amid global demand challenges, focusing on China expansion and restructuring.
By Ludwig Burger and Patricia Weiss
FRANKFURT (Reuters) -BASF on Friday predicted slight growth in adjusted operating income of up to 6.3% this year, as it seeks to slash costs in Europe while facing slow global demand and start-up expenses at a new chemical complex in China.
The German chemicals giant predicted 2025 earnings before interest, taxes, depreciation and amortisation (EBITDA) and adjusted for one-off items of between 8 billion euros ($8.3 billion) and 8.4 billion euros, up from 7.9 billion last year.
In a statement, the company added it was well on track to achieve a target of 2.1 billion euros in annual cost savings by the end of 2026.
CEO Markus Kamieth said the ramp-up at BASF's 10 billion euro site in south China would come at significant costs.
"Challenges such as high geopolitical and trade policy uncertainty will weigh on the confidence of companies and consumers ... Most improvements we aim to achieve will need to be driven by our own efforts," the CEO said.
Kamieth, at the helm for almost a year, is taking steps towards breaking up the group, a change from his predecessor's strategy.
He has been preparing a partial listing of the agricultural pesticides and seeds business while also separating its battery chemicals and catalytic converter businesses from the rest of the organisation so that they can be managed more autonomously.
The Agricultural Solutions unit will be ready for an initial public offering (IPO) by 2027, the company said in presentation slides on Friday.
The business returned to earnings growth in the fourth quarter of last year as volumes perked up, BASF added. That was similar to strong sales volumes reported by U.S. agrichemicals rival Corteva earlier this month, which posted a smaller fourth-quarter loss.
BASF reported most of its main 2024 results in an unscheduled statement last month, flagging a drop in 2024 earnings below estimates, weighed down by impairments at its battery materials business and by restructuring costs.
The German industrial heavyweight is undergoing a massive restructuring programme to cut costs, amid a sluggish industrial outlook for Germany.
(Reporting by Ludwig Burger and Patricia Weiss, Editing by Rachel More)
BASF predicted slight growth in adjusted operating income of up to 6.3% this year.
The company aims to achieve annual cost savings of 2.1 billion euros by the end of 2026.
BASF is undergoing a massive restructuring program to cut costs amid a sluggish industrial outlook in Germany.
BASF faces high geopolitical and trade policy uncertainty, which is expected to weigh on the confidence of companies and consumers.
The Agricultural Solutions unit is expected to be ready for an initial public offering (IPO) by 2027.
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