Tuesday 28 July 2015

BASF report Q2 2015

BASF, Q2, 2015, front page

BASF arrived with their Q2 2015 report and the market was very unhappy with it this time and the share price even dropped by well over -3%. What I find interesting here is that in the last report I was seriously annoyed due to their party costs and this report looks to me like business as usual so I wonder why the analysts expected so much more from BASF than what they got.

For the report in full please go here and for the latest summary which was the BASF report Q1 2015 then please click on that link and to find out more about The Chemical Company then please visit analysis of BASF 2015.

The only thing I will bring up this time is the highlight as it were presented to us. Sales are on the running half year up by 3%. Various segments are showing weak performance which is bad but mainly due to the large party costs last quarter which gave us a -20% earnings result last quarter we are at least this time only at -10% on the running half year and all else the same that party cost will be diluted down to a -2.5% effect for the full year. By the look of it as well as their non optimistic outlook for the full year I doubt that they will be able to bring in the costs for the party this year and 2015 will most likely end with a worse result than in 2014.

BASF, Q2, 2015, highlights

When I looked at the segments for Q2 I found that all of them have done well in terms of sales but oil & gas, performance and agriculture were not so impressive with their earnings. Would be nice to see a turn of that in Q3 but I doubt it.

Conclusion: The BASF hangover from the big party is still a heavy weight on our shoulders and I am still pissed off and will remain as such for the rest of this year. I will of course remain as a shareholder but grumpy.


2025 said...

I'm curious: What party costs are you writing about?

Fredrik von Oberhausen said...

BASF celebrated 150 years in Q1 2015 and the party that was arranged (= large salary bonus to managers and employees) is the spending bonus extravagance party that I write about and that annoys me. This party costed around 550 million €.

2025 said...

Ah, I have not spotted that one. Very concerning being a BASF shareholder myself.

Fredrik von Oberhausen said...

Great! Always a pleasure to meet another owner.

Well... in the long run BASF will be an excellent investment but 2015 will not go down as the best one in their history. Year 2016, now that I am looking forward to and knowing BASF as I do we can both sleep well during the night being confident that they will make money for us in the long run.