Ludwigshafen, Germany – Sales and margins in BASF’s monomers division, home to its isocyanates business, rose ‘considerably’ in the third quarter of 2017 compared to 2016 because of higher prices and more volume.
BASF, reporting in late October, said that the isocyanates business also drove considerable volume growth, largely through new production facilities and there were ‘higher margins, particularly for isocyanates,’ in the business segment.
In the third quarter sales in the monomers division of the firm’s Chemicals segment were up 41% at EUR 1.8 bn compared with EUR 1.3 bn in the 2016 third quarter.
The firm’s Functional Materials business, which contain its polyurethanes applications business, saw growth in the quarter. This was driven by polyurethane systems and thermoplastic polyurethanes because of demand from the automotive, consumer goods and construction industries.
However, margins were squeezed because of higher prices from the upstream monomers business which reduced earnings before interest and taxation.
Functional Materials is part of BASF’s larger Performance Products Business Group. This saw exceptionally high EBIT, because the sale of a BASF leather products business to Stahl which led to a special income of EUR 203m in the quarter.
Performance Products sales were EUR 3.98 bn up 2% on the 2016 third quarter, BASF said.
Overall, BASF sales in the third quarter of 2017 were EUR 15.3bn compared with EUR 14 bn in the equivalent 2016 quarter. Earnings before interest, taxation, depreciation and amortisation were EUR 3bn in the quarter compare with EUR 2.5bn in the third quarter of 2016.
Kurt Bock, BASF Chairman said: ‘We achieved solid volume growth, even compared with the strong prior year quarter.’