Leverkusen, Germany - BASF's Polyurethanes division has reported a substantial drop in sales in the second quarter of 2009 (Q2), compared to the same period last year, and sees no sign of a sustainable upturn, the company said 30 July.
Compared to Q2 2008, PU sales were down 28 percent to Euro 1000 million ($1400 million) and down 31 percent for the first six months of 2009, compared to the first half of 2008. BASF said a "considerable decline" in business volumes in all regions, as well as general falling prices, were to blame for the drop in sales. Continued weak demand in automotive and construction markets resulted in overcapacities for basic products, the company said.
Although income in the PU business was down compared to Q2 2008, there was an improvement from Q1 2009, the statement added. BASF said it continues impose cost management strategies and reduce inventories.
Performance Polymers, the other part of BASF's plastics division, also recorded a sharp drop in sales, of 32 percent, to Euro 750 million due to lower volumes and lower selling prices.
"Overall, we think that the downturn seems to have bottomed out and there seems to be a stabilisation at a low level," said BASF cfo, Kurt Bock. The cfo said the bottom had been reached in North America and China is again growing faster but the company still sees no signs of a sustained upturn. "There is still the danger of another painful setback due to overcapacities, bankruptcies and growing unemployment," Bock added.
Overall, Q2 sales for BASF dropped by 23 percent to Euro 12500 million due to lower volumes and lower prices, and income from operations was down 53 percent to Euro 1100 million, the company said, adding that both results improved on Q1 2009 figures. (RD)