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Analyst Conference Call Q2 2022
July 27, 2022
July 27, 2022
2 | BASF Analyst Conference Call Q2 2022
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 future developments and results outlined
therein. These are dependent on a number of factors; they involve various risks and uncertainties; and
they are based on assumptions that may not prove to be accurate. Such risk factors include those
discussed in Opportunities and Risks on pages 151 to 160 of the BASF Report 2021. BASF does not
assume any obligation to update the forward-looking statements contained in this presentation above
and beyond the legal requirements.
July 27, 2022
3 | BASF Analyst Conference Call Q2 2022
Snapshot of the current market environment
 The macroeconomic environment is characterized by a high degree of uncertainty
regarding the short- and mid-term economic development
 In Q2 2022, demand from customer industries remained generally solid, except for
automotive
 Supply shortages continue to limit automotive production; in Q2 2022, global
automotive production remained on the level of Q2 2021 and declined by 6.0%
compared with Q1 2022
 China’s economic growth was negatively impacted by the zero-COVID strategy
and the related lockdowns in the second quarter of 2022
 Given the inflationary environment, central banks started to raise interest rates,
which in turn will dampen consumer spending
July 27, 2022
4 | BASF Analyst Conference Call Q2 2022
Chemical production Q2 2022 compared with prior-year quarter1
%
Global chemical production increased by 1.3% in Q2 2022
Q2 2022 Q2 2021
Global GDP 2.2 11.6
Global industrial
production
2.5 17.5
Global chemical
production
1.3 9.9
Growth rates
%
1 Source: BASF, Q2 2022 partly based on estimates. Data sources: IHS, NBS China, Feri, Fed, Eurostat, METI, ONS.
All data subject to statistical revision.
July 27, 2022
5 | BASF Analyst Conference Call Q2 2022
Q2 2022: BASF again with strong earnings despite continued high
prices for raw materials and energy
 BASF’s upstream and downstream businesses implemented
further price increases to pass on higher prices for raw materials
and energy
 Due to the corona-related lockdowns in China, sales volumes in
the country declined in Q2 2022, mainly driven by lower volumes
in April
 In Q2 2022, EBIT before special items reached the level
of the prior-year quarter and amounted to €2.3 billion
 The strong earnings performance in Q2 2022 was driven by the
Agricultural Solutions, Nutrition & Care and Industrial Solutions
segments; Other also contributed
2,355
1,865
1,227
2,818
2,339
0
1,000
2,000
3,000
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
EBIT before special items
Million €
-0.7%
July 27, 2022
6 | BASF Analyst Conference Call Q2 2022
Emergency Plan for Gas of the German government
Stage 2 comprises four key measures that leave responsibilities and market
mechanisms intact:
1. All market participants are obliged to take coordinated action to avoid temporary and
regional gaps in supply in Germany and to achieve the target storage fill level of 85%
on October 1, 2022. To this end, the market area manager Trading Hub Europe has
received an additional credit line of €15 billion from the federal government to
purchase gas.
2. Market participants are obliged to participate in a crisis team that must report to the
Federal Ministry for Economic Affairs.
3. The German government is taking legal measures to restart coal-fired power plants
in Germany.
4. The Federal Network Agency wants to open a market platform where gas that is not
required by companies can be auctioned.
At present, natural gas is supplied to all of BASF’s European sites as required
July 27, 2022
7 | BASF Analyst Conference Call Q2 2022
0
10
20
30
40
50
60
Update on mitigation measures to reduce natural gas demand
BASF’s natural gas demand in Ludwigshafen 2021
TWh
 BASF’s natural gas demand in Europe 2021
− ~48 TWh, thereof Ludwigshafen ~37 TWh
− ~60% used for power/steam production and
~40% as feedstock
Rest of
Europe
Ammonia
Other gas-based
products
Power/steam
production
Potential
switch to
fuel oil2
 Mitigation measures
− Where technically feasible, preparations to substitute
natural gas (e.g., by fuel oil) are progressing well and
technical optimizations are in place
− Proactive scenario development to optimize our
production at European sites (utilization rate
reduction of specific plants) as needed
− Continued operation at the Ludwigshafen site is
ensured down to 50% of BASF’s maximum natural
gas demand2
1 Verbund site Ludwigshafen: 50% of natural gas used for power/steam production; 50% as feedstock
2 Precondition is the sufficient availability of fuel oil
Acetylene/
syngas
Natural gas
as a feedstock
Natural gas
to produce power/steam
Ludwigshafen1
July 27, 2022
8 | BASF Analyst Conference Call Q2 2022
Natural gas prices in Europe remained at a very high level
 Compared with Q1 2022, natural gas prices
declined slightly in Q2 2022 but remained at
a very high level
 Natural gas price burden for European BASF
sites
− Additional costs of ~€0.8 billion in Q2 2022
compared with Q2 2021
− Additional costs of ~€1.0 billion in Q2 2022
compared with Q2 2020
Incremental natural gas spend in Europe
Million €
-
100
200
300
400
500
Costs 2020 Additional costs 2021
0
Additional costs Q1 and Q2 2022
July 27, 2022
9 | BASF Analyst Conference Call Q2 2022
Q2 2022: Sales volumes declined by 4.4% but were almost stable
excluding precious metal volumes
Chemicals Materials
Industrial
Solutions
Surface
Technologies
Nutrition
& Care
Agricultural
Solutions Other
Overall
volume
Volume
development by
segment
Q2 2022 vs.
Q2 2021
Absolute (million €)
terms
Relative (%)
terms
-3.9% -1.8% -2.0% -14.2% 0.3% 5.2% 13.8% -4.4%
 



-872
-133
-68
-47
-839
5
101
109
Thereof 99% related
to precious metals
sales volumes



July 27, 2022
10 | BASF Analyst Conference Call Q2 2022
Q2 2022: Sales increased considerably; EBIT before special items
at the high level of the prior-year quarter
BASF
Group Chemicals Materials
Industrial
Solutions
Surface
Technologies
Nutrition
& Care
Agricultural
Solutions Other
BASF
Group
Sales
Q2 2022 vs.
Q2 2021
Million €
EBIT before
special items
Q2 2022 vs.
Q2 2021
Million €
853 668 323 227 213 223 -168
4,349 4,862 2,643 5,446 2,074 2,459 1,142
Sales by segment
Million €
EBIT before special
items by segment
Million €
July 27, 2022
11 | BASF Analyst Conference Call Q2 2022
Surface Technologies
Sales development Volumes Prices Portfolio Currencies
Q2 2022 vs. Q2 2021 -14.2% -5.7% +5.3% +7.1%
H1 2022 vs. H1 2021 -14.3% -4.5% +5.0% +5.8%
289
227
Q2 2021 Q2 2022
649
493
H1 2021 H1 2022
EBIT before special items, million €
Coatings
Catalysts
-24%
10,159
8,936
1,680
1,967
11,839
10,903
H1 2021 H1 2022
-8%
5,049
4,422
843
1,023
5,892
5,446
Q2 2021 Q2 2022
-8%
Sales, million € Lower sales and earnings in Surface Technologies in Q2 2022
 Sales declined due to lower volumes and prices; positive
currency and portfolio effects had an offsetting effect
 EBIT before special items declined considerably on account of
lower earnings in the Coatings division
Increased transparency regarding precious metals
 As of Q2 2022, sales in the Surface Technologies segment are
broken down to reflect sales excluding precious metal trading and
precious metal sales in the mobile emissions catalysts business1
-22%
Q2 2022 H1 2022
IFRS figure Adjusted figure IFRS figure Adjusted figure
Surface Technologies
Sales (million €) 5,446 2,176 10,903 4,220
Volume growth -14.2% -0.4% -14.3% -1.2%
EBITDA bsi (million €) 365 365 766 766
EBITDA margin bsi 6.7% 16.8% 7.0% 18.2%
BASF Group
EBITDA margin bsi 14.3% 16.7% 15.3% 17.9%
1 For more information, see BASF’s Half-Year Financial Report, page 49
July 27, 2022
12 | BASF Analyst Conference Call Q2 2022
138
213
Q2 2021 Q2 2022
356
457
H1 2021 H1 2022
Nutrition & Care
Sales, million €
Sales development Volumes Prices Portfolio Currencies
Q2 2022 vs. Q2 2021 +0.3% +27.0% -2.1% +5.8%
H1 2022 vs. H1 2021 +4.0% +23.9% -2.3% +4.1%
EBIT before special items, million €
Nutrition & Health
Care Chemicals
2,142
2,824
975
1,221
3,117
4,045
H1 2021 H1 2022
28%
55%
30%
31%
Considerable sales and earnings growth in the
Nutrition & Care segment in Q2 2022
 Strong sales growth in Care Chemicals and Nutrition & Health,
mainly driven by significantly higher prices to compensate for
higher raw materials and energy costs; currency tailwind and
slightly higher volumes also contributed
 EBIT before special items increased considerably due to
significantly higher earnings in the Care Chemicals division
Focus on ingredients in nutrition, flavor and fragrance in the
Nutrition & Health division
 Going forward, Nutrition & Health will consist of three focused
global business units for nutrition ingredients, aroma ingredients
and pharma solutions
1,083
1,461
501
613
1,584
2,074
Q2 2021 Q2 2022
July 27, 2022
13 | BASF Analyst Conference Call Q2 2022
Nutrition & Health will have three pillars – nutrition, aroma, pharma –
with a focus on key ingredients
 Act as a strong ingredients partner to
the animal and human nutrition
industries
 Strengthen core product platforms
deeply rooted in BASF Verbund
 Step up growth investments in
vitamins and feed enzymes
 Evaluate strategic options for food &
health performance ingredients
produced at the Illertissen site
 Offer broad portfolio of excipients
based on core value chains and
selected active ingredients
 Focus on growth and innovation in
biopharmaceuticals
 Partner customers in developing
formulations, leverage digital solutions
 Build on strong ingredients position
to address sustainability trends in
flavor and fragrance industries
 Step up growth investments in citral
value chain
 Focus innovation on sustainability
and biotechnology platform
Nutrition Ingredients Aroma Ingredients Pharma Solutions
July 27, 2022
14 | BASF Analyst Conference Call Q2 2022
Agricultural Solutions
Sales development Volumes Prices Portfolio Currencies
Q2 2022 vs. Q2 2021 +5.2% +11.4% -0.6% +9.3%
H1 2022 vs. H1 2021 +7.9% +8.6% -0.4% +5.7%
4,809
5,856
H1 2021 H1 2022
75
223
Q2 2021 Q2 2022
882
1,091
H1 2021 H1 2022
EBIT before special items, million €
24%
22%
1,963
2,459
Q2 2021 Q2 2022
25%
197%
Sales, million € Strong performance of Agricultural Solutions in Q2 2022
 Significantly higher prices in all regions, paired with
favorable FX effects and higher volumes led to positive
sales development – reflecting an overall strong demand in
the northern hemisphere
 EBIT before special items increased considerably, mainly
attributable to higher sales overcompensating higher costs
The agricultural market environment remains dynamic
 Global agricultural markets continue to be healthy with
robust commodity prices
 Challenges for the industry mainly result from global raw
material and transportation capacity shortages and
inflationary cost increases
 The outlook for the second half is positive – mainly building
on the upcoming season in South America and strong
fundamentals
July 27, 2022
15 | BASF Analyst Conference Call Q2 2022
BASF Group Q2 2022 and H1 2022: Financial figures
Financial figures Q2 2022 Change H1 2022 Change
Million € % Million € %
Sales 22,974 16.3 46,058 17.6
EBITDA before special items 3,293 2.4 7,036 10.0
EBITDA 3,396 6.2 7,105 11.4
EBIT before special items 2,339 -0.7 5,157 10.3
EBIT 2,350 1.5 5,135 11.0
Net income from
shareholdings
433 . -364 .
Net income 2,090 26.3 3,311 -1.8
July 27, 2022
16 | BASF Analyst Conference Call Q2 2022
Cash flow development in Q2 2022 and H1 2022
Q2 2022 vs. Q2 2021
 Cash flows from operating activities
decreased by €1.3 billion to €1.2 billion
 Changes in net working capital led to
a cash outflow of €1.7 billion
 Cash flows from investing activities
amounted to -€639 million compared with
€323 million. Payments made for property,
plant and equipment and intangible assets
rose by 16% to €892 million
 Free cash flow decreased by €1.4 billion
to €336 million
1 Free cash flow: cash flows from operating activities minus payments made for property, plant and equipment and intangible assets
Q2 2022
Million €
1,228
-892
336
0
400
800
1,200
Cash flows from
operating
activities
Capex Free cash flow
Q2 2022
1
H1 2022
Million €
938
-557
-1,495
-800
-400
0
400
800
1,200
Cash flows from
operating
activities
Capex Free cash flow
H1 2022
1
July 27, 2022
17 | BASF Analyst Conference Call Q2 2022
Strong balance sheet
Balance sheet June 30, 2022, vs. Dec. 31, 2021
Billion €
Liquid funds
Accounts
receivable, trade
Noncurrent
assets
Inventories
Other assets
4.0 2.8
7.6 6.5
15.8
11.9
16.0
13.9
53.6
52.3
June 30, 2022 Dec. 31, 2021
87.4
97.0
Other
liabilities
Financial
debt
Equity
27.1 28.1
23.5
17.2
46.4
42.1
June 30, 2022 Dec. 31, 2021
87.4
97.0
 Total assets increased by €9.6 billion
to €97.0 billion
 Noncurrent assets amounted to
€53.6 billion, an increase of €1.3 billion
 Current assets increased by €8.3 billion to
€43.4 billion, mainly due to higher trade
accounts receivable. In addition, higher
inventories, other receivables and
miscellaneous assets and cash and cash
equivalents contributed to the increase
 Net debt increased by €5.2 billion to
€19.5 billion
 Equity ratio: 47.8% (December 31, 2021:
48.2%)
July 27, 2022
18 | BASF Analyst Conference Call Q2 2022
Main construction phases of the new Verbund site in Zhanjiang,
China – stepwise approach
Initial phase
on stream: 2022–2023
Phase 1
start-up: as of 2025
Steam
cracker
Phase 2
start-up: as of 2028
Engineering plastics
and thermoplastic
polyurethanes
C2 value chain
Heart of the Verbund:
Petrochemicals plus further
downstream plants
Verbund expansion
and diversification
First downstream plants:
Performance Materials for auto-
motive and consumer industries
C3 value chain
C4 value chain
Additional
downstream plants
Update on progress
 First downstream plant
is currently starting up
 Construction of phase 1 plants
started following final approval
 Stepwise construction approach
allows for flexibility, especially
with regard to phase 2
Backward integrated into world-scale
upstream plants to achieve Verbund
synergies in downstream value chains
July 27, 2022
18 | BASF Analyst Conference Call Q2 2022
July 27, 2022
19 | BASF Analyst Conference Call Q2 2022
Outlook 2022 for BASF Group
Underlying assumptions (previous assumptions in parentheses)
 Growth in gross domestic product: 2.5% (3.8%)
 Growth in industrial production: 3.0% (3.8%)
 Growth in chemical production: 2.5% (3.5%)
 Average euro/dollar exchange rate: $1.07 per euro ($1.15 per euro)
 Average annual oil price (Brent crude): $110 per barrel ($75 per barrel)
Outlook 2022 Revised forecast Previous forecast
Sales €86 billion – €89 billion €74 billion – €77 billion
EBIT before special items €6.8 billion – €7.2 billion €6.6 billion – €7.2 billion
ROCE 10.5% – 11.0% 11.4% – 12.6%
CO2 emissions 18.4 – 19.4 million metric tons 19.6 – 20.6 million metric tons
Slides Analyst Conference Q2 2022

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Slides Analyst Conference Q2 2022

  • 1. Analyst Conference Call Q2 2022 July 27, 2022
  • 2. July 27, 2022 2 | BASF Analyst Conference Call Q2 2022 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 future developments and results outlined therein. These are dependent on a number of factors; they involve various risks and uncertainties; and they are based on assumptions that may not prove to be accurate. Such risk factors include those discussed in Opportunities and Risks on pages 151 to 160 of the BASF Report 2021. BASF does not assume any obligation to update the forward-looking statements contained in this presentation above and beyond the legal requirements.
  • 3. July 27, 2022 3 | BASF Analyst Conference Call Q2 2022 Snapshot of the current market environment  The macroeconomic environment is characterized by a high degree of uncertainty regarding the short- and mid-term economic development  In Q2 2022, demand from customer industries remained generally solid, except for automotive  Supply shortages continue to limit automotive production; in Q2 2022, global automotive production remained on the level of Q2 2021 and declined by 6.0% compared with Q1 2022  China’s economic growth was negatively impacted by the zero-COVID strategy and the related lockdowns in the second quarter of 2022  Given the inflationary environment, central banks started to raise interest rates, which in turn will dampen consumer spending
  • 4. July 27, 2022 4 | BASF Analyst Conference Call Q2 2022 Chemical production Q2 2022 compared with prior-year quarter1 % Global chemical production increased by 1.3% in Q2 2022 Q2 2022 Q2 2021 Global GDP 2.2 11.6 Global industrial production 2.5 17.5 Global chemical production 1.3 9.9 Growth rates % 1 Source: BASF, Q2 2022 partly based on estimates. Data sources: IHS, NBS China, Feri, Fed, Eurostat, METI, ONS. All data subject to statistical revision.
  • 5. July 27, 2022 5 | BASF Analyst Conference Call Q2 2022 Q2 2022: BASF again with strong earnings despite continued high prices for raw materials and energy  BASF’s upstream and downstream businesses implemented further price increases to pass on higher prices for raw materials and energy  Due to the corona-related lockdowns in China, sales volumes in the country declined in Q2 2022, mainly driven by lower volumes in April  In Q2 2022, EBIT before special items reached the level of the prior-year quarter and amounted to €2.3 billion  The strong earnings performance in Q2 2022 was driven by the Agricultural Solutions, Nutrition & Care and Industrial Solutions segments; Other also contributed 2,355 1,865 1,227 2,818 2,339 0 1,000 2,000 3,000 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 EBIT before special items Million € -0.7%
  • 6. July 27, 2022 6 | BASF Analyst Conference Call Q2 2022 Emergency Plan for Gas of the German government Stage 2 comprises four key measures that leave responsibilities and market mechanisms intact: 1. All market participants are obliged to take coordinated action to avoid temporary and regional gaps in supply in Germany and to achieve the target storage fill level of 85% on October 1, 2022. To this end, the market area manager Trading Hub Europe has received an additional credit line of €15 billion from the federal government to purchase gas. 2. Market participants are obliged to participate in a crisis team that must report to the Federal Ministry for Economic Affairs. 3. The German government is taking legal measures to restart coal-fired power plants in Germany. 4. The Federal Network Agency wants to open a market platform where gas that is not required by companies can be auctioned. At present, natural gas is supplied to all of BASF’s European sites as required
  • 7. July 27, 2022 7 | BASF Analyst Conference Call Q2 2022 0 10 20 30 40 50 60 Update on mitigation measures to reduce natural gas demand BASF’s natural gas demand in Ludwigshafen 2021 TWh  BASF’s natural gas demand in Europe 2021 − ~48 TWh, thereof Ludwigshafen ~37 TWh − ~60% used for power/steam production and ~40% as feedstock Rest of Europe Ammonia Other gas-based products Power/steam production Potential switch to fuel oil2  Mitigation measures − Where technically feasible, preparations to substitute natural gas (e.g., by fuel oil) are progressing well and technical optimizations are in place − Proactive scenario development to optimize our production at European sites (utilization rate reduction of specific plants) as needed − Continued operation at the Ludwigshafen site is ensured down to 50% of BASF’s maximum natural gas demand2 1 Verbund site Ludwigshafen: 50% of natural gas used for power/steam production; 50% as feedstock 2 Precondition is the sufficient availability of fuel oil Acetylene/ syngas Natural gas as a feedstock Natural gas to produce power/steam Ludwigshafen1
  • 8. July 27, 2022 8 | BASF Analyst Conference Call Q2 2022 Natural gas prices in Europe remained at a very high level  Compared with Q1 2022, natural gas prices declined slightly in Q2 2022 but remained at a very high level  Natural gas price burden for European BASF sites − Additional costs of ~€0.8 billion in Q2 2022 compared with Q2 2021 − Additional costs of ~€1.0 billion in Q2 2022 compared with Q2 2020 Incremental natural gas spend in Europe Million € - 100 200 300 400 500 Costs 2020 Additional costs 2021 0 Additional costs Q1 and Q2 2022
  • 9. July 27, 2022 9 | BASF Analyst Conference Call Q2 2022 Q2 2022: Sales volumes declined by 4.4% but were almost stable excluding precious metal volumes Chemicals Materials Industrial Solutions Surface Technologies Nutrition & Care Agricultural Solutions Other Overall volume Volume development by segment Q2 2022 vs. Q2 2021 Absolute (million €) terms Relative (%) terms -3.9% -1.8% -2.0% -14.2% 0.3% 5.2% 13.8% -4.4%      -872 -133 -68 -47 -839 5 101 109 Thereof 99% related to precious metals sales volumes   
  • 10. July 27, 2022 10 | BASF Analyst Conference Call Q2 2022 Q2 2022: Sales increased considerably; EBIT before special items at the high level of the prior-year quarter BASF Group Chemicals Materials Industrial Solutions Surface Technologies Nutrition & Care Agricultural Solutions Other BASF Group Sales Q2 2022 vs. Q2 2021 Million € EBIT before special items Q2 2022 vs. Q2 2021 Million € 853 668 323 227 213 223 -168 4,349 4,862 2,643 5,446 2,074 2,459 1,142 Sales by segment Million € EBIT before special items by segment Million €
  • 11. July 27, 2022 11 | BASF Analyst Conference Call Q2 2022 Surface Technologies Sales development Volumes Prices Portfolio Currencies Q2 2022 vs. Q2 2021 -14.2% -5.7% +5.3% +7.1% H1 2022 vs. H1 2021 -14.3% -4.5% +5.0% +5.8% 289 227 Q2 2021 Q2 2022 649 493 H1 2021 H1 2022 EBIT before special items, million € Coatings Catalysts -24% 10,159 8,936 1,680 1,967 11,839 10,903 H1 2021 H1 2022 -8% 5,049 4,422 843 1,023 5,892 5,446 Q2 2021 Q2 2022 -8% Sales, million € Lower sales and earnings in Surface Technologies in Q2 2022  Sales declined due to lower volumes and prices; positive currency and portfolio effects had an offsetting effect  EBIT before special items declined considerably on account of lower earnings in the Coatings division Increased transparency regarding precious metals  As of Q2 2022, sales in the Surface Technologies segment are broken down to reflect sales excluding precious metal trading and precious metal sales in the mobile emissions catalysts business1 -22% Q2 2022 H1 2022 IFRS figure Adjusted figure IFRS figure Adjusted figure Surface Technologies Sales (million €) 5,446 2,176 10,903 4,220 Volume growth -14.2% -0.4% -14.3% -1.2% EBITDA bsi (million €) 365 365 766 766 EBITDA margin bsi 6.7% 16.8% 7.0% 18.2% BASF Group EBITDA margin bsi 14.3% 16.7% 15.3% 17.9% 1 For more information, see BASF’s Half-Year Financial Report, page 49
  • 12. July 27, 2022 12 | BASF Analyst Conference Call Q2 2022 138 213 Q2 2021 Q2 2022 356 457 H1 2021 H1 2022 Nutrition & Care Sales, million € Sales development Volumes Prices Portfolio Currencies Q2 2022 vs. Q2 2021 +0.3% +27.0% -2.1% +5.8% H1 2022 vs. H1 2021 +4.0% +23.9% -2.3% +4.1% EBIT before special items, million € Nutrition & Health Care Chemicals 2,142 2,824 975 1,221 3,117 4,045 H1 2021 H1 2022 28% 55% 30% 31% Considerable sales and earnings growth in the Nutrition & Care segment in Q2 2022  Strong sales growth in Care Chemicals and Nutrition & Health, mainly driven by significantly higher prices to compensate for higher raw materials and energy costs; currency tailwind and slightly higher volumes also contributed  EBIT before special items increased considerably due to significantly higher earnings in the Care Chemicals division Focus on ingredients in nutrition, flavor and fragrance in the Nutrition & Health division  Going forward, Nutrition & Health will consist of three focused global business units for nutrition ingredients, aroma ingredients and pharma solutions 1,083 1,461 501 613 1,584 2,074 Q2 2021 Q2 2022
  • 13. July 27, 2022 13 | BASF Analyst Conference Call Q2 2022 Nutrition & Health will have three pillars – nutrition, aroma, pharma – with a focus on key ingredients  Act as a strong ingredients partner to the animal and human nutrition industries  Strengthen core product platforms deeply rooted in BASF Verbund  Step up growth investments in vitamins and feed enzymes  Evaluate strategic options for food & health performance ingredients produced at the Illertissen site  Offer broad portfolio of excipients based on core value chains and selected active ingredients  Focus on growth and innovation in biopharmaceuticals  Partner customers in developing formulations, leverage digital solutions  Build on strong ingredients position to address sustainability trends in flavor and fragrance industries  Step up growth investments in citral value chain  Focus innovation on sustainability and biotechnology platform Nutrition Ingredients Aroma Ingredients Pharma Solutions
  • 14. July 27, 2022 14 | BASF Analyst Conference Call Q2 2022 Agricultural Solutions Sales development Volumes Prices Portfolio Currencies Q2 2022 vs. Q2 2021 +5.2% +11.4% -0.6% +9.3% H1 2022 vs. H1 2021 +7.9% +8.6% -0.4% +5.7% 4,809 5,856 H1 2021 H1 2022 75 223 Q2 2021 Q2 2022 882 1,091 H1 2021 H1 2022 EBIT before special items, million € 24% 22% 1,963 2,459 Q2 2021 Q2 2022 25% 197% Sales, million € Strong performance of Agricultural Solutions in Q2 2022  Significantly higher prices in all regions, paired with favorable FX effects and higher volumes led to positive sales development – reflecting an overall strong demand in the northern hemisphere  EBIT before special items increased considerably, mainly attributable to higher sales overcompensating higher costs The agricultural market environment remains dynamic  Global agricultural markets continue to be healthy with robust commodity prices  Challenges for the industry mainly result from global raw material and transportation capacity shortages and inflationary cost increases  The outlook for the second half is positive – mainly building on the upcoming season in South America and strong fundamentals
  • 15. July 27, 2022 15 | BASF Analyst Conference Call Q2 2022 BASF Group Q2 2022 and H1 2022: Financial figures Financial figures Q2 2022 Change H1 2022 Change Million € % Million € % Sales 22,974 16.3 46,058 17.6 EBITDA before special items 3,293 2.4 7,036 10.0 EBITDA 3,396 6.2 7,105 11.4 EBIT before special items 2,339 -0.7 5,157 10.3 EBIT 2,350 1.5 5,135 11.0 Net income from shareholdings 433 . -364 . Net income 2,090 26.3 3,311 -1.8
  • 16. July 27, 2022 16 | BASF Analyst Conference Call Q2 2022 Cash flow development in Q2 2022 and H1 2022 Q2 2022 vs. Q2 2021  Cash flows from operating activities decreased by €1.3 billion to €1.2 billion  Changes in net working capital led to a cash outflow of €1.7 billion  Cash flows from investing activities amounted to -€639 million compared with €323 million. Payments made for property, plant and equipment and intangible assets rose by 16% to €892 million  Free cash flow decreased by €1.4 billion to €336 million 1 Free cash flow: cash flows from operating activities minus payments made for property, plant and equipment and intangible assets Q2 2022 Million € 1,228 -892 336 0 400 800 1,200 Cash flows from operating activities Capex Free cash flow Q2 2022 1 H1 2022 Million € 938 -557 -1,495 -800 -400 0 400 800 1,200 Cash flows from operating activities Capex Free cash flow H1 2022 1
  • 17. July 27, 2022 17 | BASF Analyst Conference Call Q2 2022 Strong balance sheet Balance sheet June 30, 2022, vs. Dec. 31, 2021 Billion € Liquid funds Accounts receivable, trade Noncurrent assets Inventories Other assets 4.0 2.8 7.6 6.5 15.8 11.9 16.0 13.9 53.6 52.3 June 30, 2022 Dec. 31, 2021 87.4 97.0 Other liabilities Financial debt Equity 27.1 28.1 23.5 17.2 46.4 42.1 June 30, 2022 Dec. 31, 2021 87.4 97.0  Total assets increased by €9.6 billion to €97.0 billion  Noncurrent assets amounted to €53.6 billion, an increase of €1.3 billion  Current assets increased by €8.3 billion to €43.4 billion, mainly due to higher trade accounts receivable. In addition, higher inventories, other receivables and miscellaneous assets and cash and cash equivalents contributed to the increase  Net debt increased by €5.2 billion to €19.5 billion  Equity ratio: 47.8% (December 31, 2021: 48.2%)
  • 18. July 27, 2022 18 | BASF Analyst Conference Call Q2 2022 Main construction phases of the new Verbund site in Zhanjiang, China – stepwise approach Initial phase on stream: 2022–2023 Phase 1 start-up: as of 2025 Steam cracker Phase 2 start-up: as of 2028 Engineering plastics and thermoplastic polyurethanes C2 value chain Heart of the Verbund: Petrochemicals plus further downstream plants Verbund expansion and diversification First downstream plants: Performance Materials for auto- motive and consumer industries C3 value chain C4 value chain Additional downstream plants Update on progress  First downstream plant is currently starting up  Construction of phase 1 plants started following final approval  Stepwise construction approach allows for flexibility, especially with regard to phase 2 Backward integrated into world-scale upstream plants to achieve Verbund synergies in downstream value chains July 27, 2022 18 | BASF Analyst Conference Call Q2 2022
  • 19. July 27, 2022 19 | BASF Analyst Conference Call Q2 2022 Outlook 2022 for BASF Group Underlying assumptions (previous assumptions in parentheses)  Growth in gross domestic product: 2.5% (3.8%)  Growth in industrial production: 3.0% (3.8%)  Growth in chemical production: 2.5% (3.5%)  Average euro/dollar exchange rate: $1.07 per euro ($1.15 per euro)  Average annual oil price (Brent crude): $110 per barrel ($75 per barrel) Outlook 2022 Revised forecast Previous forecast Sales €86 billion – €89 billion €74 billion – €77 billion EBIT before special items €6.8 billion – €7.2 billion €6.6 billion – €7.2 billion ROCE 10.5% – 11.0% 11.4% – 12.6% CO2 emissions 18.4 – 19.4 million metric tons 19.6 – 20.6 million metric tons