Ludwigshafen, Germany -- Chemicals giant BASF achieved record sales and earnings in 2010, said chairman Dr Juergen Hambrecht, with a 26-percent increase in sales to Euro 63 900 million ($88067 million) for 2010, and earnings (EBIT before special items) of Euro 8100 million, a rise of 68 percent.
In its polyurethanes business, sales volumes rose more strongly at 32 percent for the year, but BASF noted that margins in this business did not match those of 2009.
"In the chemicals business, in particular, we were able to take advantage of the strong economic recovery in 2010, which was more dynamic than we all initially expected," commented Hambrecht, at the company's 24 Feb press conference.
In polyurethanes, for the fourth quarter (Q4), prices remained stable and sales rose mainly due to increasing volumes and currency effects, said BASF. Sales volume rose in all areas, in particular in specialities such as Cellasto, and thermoplastic polyurethanes.
But higher raw materials costs, for example for benzene, had a negative effect on margins for the basic product TDI (toluene diisocyanate) in Q4. As a result, earnings in polyurethanes in Q4 2010 were below the level for Q4 2009, the group noted.
Sales for polyurethanes were Euro 5441 million, for the full year and Euro 1363 million for Q4, a 32- percent and 20-percent rise respectively.
For the year as a whole, BASF said the polyurethanes division posted strong growth in all product lines and regions in 2010, due to higher sales volumes and positive currency effects.
BASF noted that demand from key customer sectors such as automotive and construction recovered more rapidly than expected. Especially in Asia and Europe.
"Thanks to the strong economic upturn in China, demand for polyurethanes increased considerably compares with the previous year, especially in Asia," the company noted.
The group said that it only raised prices marginally in 2010 in polyurethanes: "It was not until the middle of the year that we were able to gradually raise MDI (methylene diphenyl diisocyanate) prices as a result of supply shortages."
And the group emphasised that margins - especially for TDI and MDI - "did not match the 2009 level." This was because of the sharp rise in raw materials prices at the start of the year. Despite this, BASF said income from operations was "far above the 2009 leve, due to higher volumes."
Earnings in specialities, in particular, developed well, BASF said, as a result of high demand in automotive uses.
Asked about the long-running saga of BASF's Euro 1 billion investment in Chonqqing in western China, which involves building a 400-kilotonnes-per-annum capacity MDI plant, Hambrecht said that this project "is still in the approval phase with the central government. On the whole we believe it will be approved soon."
All environmental questions concerning this plant have been discussed with all the authorities, and approved, "so we believe it will go through," he continued.
Sales for the whole plastics division, which also covers performance polymers, were Euro 9830 million for the year and Euro 2451 for Q4, a 38-percent and 26-percent rise respectively.
Plastics earnings (EBITDA) were Euro 1721 million for the year and Euro 400 for Q4, representing a 73-percent and 19- percent rise respectively.
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