Adds Q3 loss, firm remark, shares BERLIN, Oct 9 (Reuters) -
Adds Q3 loss, firm remark, shares
BERLIN, Oct 9 (Reuters) – BASF BASFn.DE slashed its outlook on Friday after heavy writeoffs despatched it to a quarterly web lack of 2.6 billion euros ($3.1 billion), blaming a stoop in demand attributable to the coronavirus pandemic and a glut in fundamental chemical compounds.
The German group mentioned it had taken 2.eight billion euros in fixed-asset impairments – largely as a consequence of weaker demand within the automotive and aviation industries – because it launched its third-quarter outcomes forward of schedule.
The kitchen-sink writeoffs additionally mirrored margin stress in fundamental chemical compounds, the price of streamlining BASF’s agricultural options section and “realigning” its International Enterprise Companies unit, the corporate mentioned.
Shares fell 2.2% in afternoon buying and selling in Frankfurt.
Earlier than gadgets, core working revenue is now anticipated to fall by as a lot as 35% this 12 months, to between Three and three.Three billion euros, whereas income is predicted to say no to between 57 and 58 billion euros.
“In addition to weaker demand, the corporate expects stress on margins to proceed, particularly for fundamental chemical compounds, which might be partially offset by mounted price financial savings,” BASF mentioned in a press release.
The outlook assumes a 5% contraction of the worldwide economic system and an oil worth of $40 a barrel however doesn’t issue within the chance that rising coronavirus infections all over the world will result in renewed lockdowns.
($1 = 0.8467 euros)
(Reporting by Kirsti Knolle and Douglas Busvine; Modifying by Kirsten Donovan)
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