Cautionary note regarding forward-looking statements

Transcription

1 Cautionary note regarding forward-looking statements This presentation may contain forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described herein. Forward-looking statements may include, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. BASF has based these forward-looking statements on its views and assumptions with respect to future events and financial performance. Actual financial performance could differ materially from that projected in the forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements. The information contained in this presentation is subject to change without notice and BASF does not undertake any duty to update the forwardlooking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations. 1

2 We create chemistry for a sustainable future Positioning Performance Perspective Geismar, USA Freeport, USA Ludwigshafen, Germany Antwerp, Belgium Nanjing, China Kuantan, Malaysia Verbund site The #1 chemical company 72.1 billion sales, 6.6 billion EBIT bsi in 2012* #1-3 in >75% of businesses, present in >200 countries 6 integrated Verbund sites, production in 41 countries * restated numbers, reflecting IFRS 10/11 changes 10 years of strong sales and earnings growth 20% average annual total shareholder return** 16% average annual dividend increase, >3% yield in every single year*** ** June 2003 May 2013 *** for Chemistry as an enabler BASF has superior growth opportunities: - sustainable innovations - investments - emerging markets Ambitious financial targets 2

3 BASF today a well-balanced portfolio Total sales 2012: 72.1 billion* Percentage of sales 2012** * Restated numbers, reflecting IFRS 10/11 changes, new segment structure effective Jan. 1, 2013 ** Not depicted here: ~5% of Group sales reported as Other 3

4 Business review BASF Today Trends Business review Purpose and strategic principles Targets BASF strategy & growth targets Strategic Strategic levers levers BASF Tomorrow Board priorities BASF BASF Strategy: Capital We Market create Story chemistry November July

5 BASF with a solid start to 2013 Business performance Q1 13 Q1 12 vs. Q1 12 Sales 19.7 billion 18.8 billion +5% EBITDA 2.9 billion 3.3 billion (14%) EBIT before special items 2.2 billion 2.0 billion +10% EBIT 2.2 billion 2.6 billion (17%) Net income 1.4 billion 1.7 billion (15%) Reported EPS (15%) Adjusted EPS % Operating cash flow 2.0 billion 1.5 billion +33% Sales development Period Volumes Prices Portfolio Currencies Q1 13 vs. Q1 12 5% 1% 0% (1%) 5

6 Strong free cash flow generation Free cash flow* in billion 2.8 2, ** Q * Cash provided by operating activities less capex (in 2005 before CTA) ** 2009 adjusted for re-classification of settlement payments for currency derivatives 6

7 Delivering attractive shareholder returns Dividend per share (in ) Dividend payments Dividend of 2.60 per share for 2012 (+4%) : Average annual dividend increase of 16% Attractive dividend yield of 3.7% in 2012** Dividend yield above 3% in any given year since 2002, total payout almost 17 billion Dividend yield* 3.1% 3.2% 3.1% 4.1% 3.8% 7.0% 3.9% 3.7% 4.6% 3.7% * Dividend yield based on share price at year-end ** Based on BASF share price of on Dec. 28,

8 Delivering consistent, long-term value Average annual performance with dividends reinvested Last 10 years June 2003 May 2013 Last 5 years June 2008 May % BASF +14.0% +4.9% Euro Stoxx % +10.8% DAX % +12.0% MSCI World Chemicals +3.0%

9 Outlook 2013 confirmed Outlook 2013 Excluding the effects of acquisitions and divestitures, we strive to increase our sales volumes in 2013 We aim to exceed the 2012 restated levels in sales and EBIT before special items The expected increase in demand, together with our measures to improve operational excellence and raise efficiency, will contribute to this We aim to earn a high premium on cost of capital once again in 2013 Assumptions 2013 GDP: +2.4% Industrial production: +3.4% Chemical production: +3.6% US$ / Euro: 1.30 Oil price (US$ / bbl): 110 9

10 Business review BASF Today Trends Business review Purpose and strategic principles Targets BASF strategy & growth targets Strategic Strategic levers levers BASF Tomorrow Board priorities BASF BASF Strategy: Capital We Market create Story chemistry November July

11 Demographic challenges set the stage for the future of the chemical industry Nine billion people in 2050 but only one earth Resources, Environment & Climate Food & Nutrition Quality of Life Chemistry as enabler 11

12 Key financial targets 2015 / 2020 Growth targets Profitability targets Grow at least 2 percentage points above chemical production Earn a premium on cost of capital of at least 2.0 billion on average p.a Sales ~ 80 billion EBITDA ~ 14 billion EPS ~ Sales ~ 110 billion EBITDA ~ 22 billion 12

13 Business review BASF Business Today review Trends BASF strategy & growth targets Purpose and strategic principles Targets Strategic levers Strategic Portfolio levers development Market approach BASF Tomorrow Board priorities Innovations for a sustainable future Investments Acquisitions Operational excellence BASF BASF Strategy: Capital We Market create Story chemistry November July

14 Portfolio development We expand from chemicals to chemistry New molecules Chemistry as key enabler for functionalized materials & solutions Improved applications Functionalized materials & solutions Deep understanding of customer value chains required Batteries, membranes... 14

15 Portfolio development Moving downstream towards customer industries Classical Chemicals Customized Products Functionalized Materials & Solutions 2001 in % of sales** Chemical Industry ~ 50% First customer industries* ~ 50% 2010 in % of sales** ~ 40% ~ 60% 2020 in % of sales** ~ 30% ~ 70% * Agriculture, Construction, Consumer Goods, Health & Nutrition, Electronics, Energy & Resources, Transportation ** Sales excluding Oil & Gas. Targets were published on November 29,

16 Portfolio development Towards more market driven and innovative businesses Acquisitions Engineering plastics Electronic chemicals Catalysts Construction chemicals Water-based resins Pigments Plastic additives Oil & Gas Personal care & food Battery materials Functional crop care Omega-3 fatty acids BASF core business Selected transactions 2001 today* Strong partnerships Gazprom Monsanto Petronas Shell Sinopec Total Pharma Fibers Divestitures Printing systems Polyolefins Polystyrene Americas Agro generics Vitamins premix Fertilizers Styrenics (transferred into Styrolution JV on Oct. 1, 2011) ~ 15bn sales ~ 10bn sales** * only closed deals have been considered ** without Styrenics 16

17 Ongoing portfolio development Transactions with Statoil and Gazprom Acquisition of Pronova BioPharma Restructuring in Performance Products Aroma Ingredients Investment, Kuantan

18 Market approach Cross-divisional customer industry approach BASF sales by first customer industry* Bubble Size: BASF divisional sales by first customer industry (2010)** Consumer goods > 15 % Transportation > 15 % Construction < 10 % Energy & Resources < 10 % Inorganics Catalysts Petrochemicals Construction Chemicals Intermediates Coatings Dispersions & Pigments Care Chemicals Performance Chemicals Paper Chemicals Polyurethanes Performance Polymers * Excluding Oil & Gas and Other ** Excluding Agricultural Solutions, Health & Nutrition, Oil & Gas and Other 18

19 Cross-divisional approach: Smartforvision Technology competencies combined with customer know-how Lightweight tridion cell High performance foams Solar roof with transparent organic solar panels and OLED modules E-textiles Infrared-reflective film Infrared-reflective coating Multifunctional seat All-plastic wheel Daimler & BASF concept car Smartforvison 19

20 Innovation with adidas: BOOST Technology competencies combined with customer know-how Photo: adidas Key facts Joint development with adidas, illustrating our customer focus New energy BOOST cushioning material, provides highest energy return in the running industry Solid granular material* is blown up, turned into 1000 s of small energy capsules With their unique cell structure, these energy capsules store and unleash energy more efficiently in every stride New shoe is available in stores since February, 2013 * TPU (Thermoplastic polyurethane) 20

21 Strong commitment to R&D Innovations for a sustainable future R&D expenditures (billion ) 2,0 1,5 1,0 0,5 0, Corporate Research 23% Oil & Gas 2% Agricultural Solutions 25% Functional Mat. & Sol. 20% Performance Products 20% Chemicals 10% Key facts 1.7 billion R&D expenditures in 2012, further increase planned for 2013 ~10,500 employees in R&D ~3,000 projects Research Verbund: About 1,950 partnerships with universities, start-ups and industry partners Target 2015 and 2020: - 10 billion in sales from innovations younger 5 years; - 30 billion in sales from innovations younger 10 years 21

22 Chemistry as an enabler: Growth Fields Innovations for a sustainable future Customer industries Transportation Construction Consumer Goods Health & Nutrition Electronics Agriculture Energy & Resources Batteries for mobility Heat management Enzymes Medical Organic electronics Plant biotechnology E-Power management Growth Fields Lightweight composites Functional crop care Wind energy Water solutions Ongoing inflow of new growth fields

23 Battery materials will play a key role in advancing electromobility of the future Focus Advanced cathodes and electrolytes development for lithium-ion batteries, as well as next-generation battery systems Business potential 2020 Overall market size: > 20 billion globally (~ 16 billion in Asia Pacific) SRM size: > 5 billion globally (~ 4 billion in Asia Pacific) BASF sales potential: > 500 million globally (~ 350 million in Asia Pacif.) Activities Acquisition of Novolyte Technologies (April 2012), including production facility, Application Technology Center in Suzhou, China New electrolytes R&D laboratory and Application Technology Center for Battery Materials starting up in Amagasaki, Japan, 2013 Ongoing collaboration with leading universities, institutes and industry partners, as well as battery producers and OEMs Target Position BASF as a leading global solution provider for battery and cell manufacturers

24 Investments will boost future organic growth Future investments ( billlion) ~ % 35-45% ~20% Total investments Thereof investments in emerging markets 24

25 Investments Major projects MDI plant Chongqing, China Expansion Verbund site Nanjing, China* Acrylic acid complex Camacari, Brazil TDI plant Ludwigshafen, Germany Aroma Ingredients Kuantan, Malaysia Expansion oil & gas activities * Memorandum of Understanding signed 25

26 Acquisitions will contribute to profitable growth in the future We want to acquire businesses which Generate profitable growth above the industry average Are innovation-driven Offer a special value proposition to customers Provide a minimum return on investment of 8% p.a. after tax Are EPS accretive by year three at the latest Reduce earnings cyclicality Strategic acquisition criteria Financial acquisition criteria 26

27 Operational excellence STEP program on track: ~ 1 billion earnings contribution by 2015 Annual earnings contribution ( million) 3,000 2,000 1,000 0 Former cost saving programs NEXT STEP NEXT Program NEXT program successfully completed Annual earnings contribution of ~ 1 billion achieved in 2012 STrategic Excellence Program STEP Targeted annual earnings contribution of ~ 1 billion by end of 2015 Project timeline: Program is on track Measures to optimize processes and structures in all regions, e.g. manufacturing, maintenance supply chain engineering, best-cost country sourcing One-time costs & investments: ~ 1 billion 27

28 Appendix Business development Q1 2013

29 Chemicals Earnings increase due to higher margins Q1 13 segment sales (million ) vs. Q1 12 Intermediates % 4,396-3% Monomers 1,680 +4% Petrochemicals 2,016 (9%) EBIT before special items (million ) Q1 Q2 Q3 Q4 Q Sales development Period Volumes Prices Portfolio Currencies Q1 13 vs. Q1 12 (2%) 1% (1%) (1%) 29

30 Performance Products Stable volumes but lower earnings Q1 13 segment sales (million ) vs. Q1 12 Care Chemicals 1,275 0% Paper Chemicals 362 (8%) 3,880-2% Performance Chemicals 891 0% Nutrition & Health % Dispersions & Pigments 859 (7%) EBIT before special items (million ) Q1 Q2 Q3 Q4 Q Sales development Period Volumes Prices Portfolio Currencies Q1 13 vs. Q1 12 0% (2%) 1% (1%) 30

31 Functional Materials & Solutions Increased demand in Performance Materials Q1 13 segment sales (million ) vs. Q1 12 Performance Materials 1,572 +6% Catalysts 1,453 (1%) 4,181 +0% Construction Chemicals 458 (9%) Coatings 698 (2%) EBIT before special items (million ) Q1 Q2 Q3 Q4 Q Sales development Period Volumes Prices Portfolio Currencies Q1 13 vs. Q1 12 2% 0% 0% (2%) 31

32 Agricultural Solutions Excellent start into the year, record sales and earnings Q1 13 segment sales (million ) vs. Q1 12 EBIT before special items (million ) ,327 1, Q1 Q1 0 Q1 Q Sales development Period Volumes Prices Portfolio Currencies Q1 13 vs. Q % 1% 4% (1%) 32

33 Oil & Gas Sales growth due to higher production Q1 13 segment sales (million ) vs. Q1 12 EBIT bsi/net income (million ) Natural Gas Trading 3, % 4, % Exploration & Production % Q1/2012 Net Income Q1/2013 Net Income Exploration & Production Natural Gas Trading Net income Sales development Period Volumes Prices/Currencies Portfolio Q1 13 vs. Q % 1% 0% 33

34 Review of Other Million Q1 13 Q1 12 Sales 1, EBIT before special items (182) (314) thereof Corporate research Group corporate costs Currency results, hedges and other valuation effects Styrenics, fertilizers, other businesses (97) (56) (97) (58) (206) 145 Special items (28) 578 EBIT (210)

35 Balance sheet remains strong Balance sheet March 31, 2013 vs. Dec. 31, 2012 (billion ) Long-term assets Disposal group Inventories Accounts receivable Other assets Liquid funds Dec March March Dec Stockholders equity Financial debt Disposal group Other liabilities Highlights March 31, 2013 Long term assets increased mainly due to consolidation of former Pronova BioPharma business Short term assets up due to increase in accounts receivable Increase in financial debt due to issuance of long-term bonds Net debt: 10.9 billion Equity ratio: 41% 35

36 Appendix Additional information from Investor Day Asia Pacific (June 5-6, 2013)

37 We create chemistry in Asia Pacific: 2020 targets Market 25 billion sales Innovation ~3,500 R&D staff Portfolio > 2 billion sales from new biz and acquisitions Investment 75% OMP ratio People ~9,000 new jobs Excellence 1 billion cost savings

38 Asia Pacific Organic growth drives top line growth Sales contributions billion > 10 billion CAGR ~9% > 2 billion New Sales Target: 25 billion 12.5 billion 2012 restated Organic Growth New Business & Acquisitions restated = adjusted to changes in IFRS 10 & 11