BASF and Wanhua Chemical's first-half results released
Source: Sinochem New Network 
113,873 
July 31, 2023, 11:00 AM
Downstream demand is poor, chemical prices have fallen, and revenue from BASF and Wanhua both fell in the first half of the year; profits fell even more, both by more than 10 per cent.
Wanhua Chemical's revenue and profit fell in the first half of the year.
On July 28, Wanhua Chemical disclosed that its revenue in the first half of the year was 87.6 billion yuan, down 1.67%, and its net profit was 8.568 billion yuan, down 17.48%.
Wanhua Chemical said that as downstream demand was in the recovery stage, prices fell year-on-year, resulting in a year-on-year drop in revenue. In addition, the decline in raw material prices is limited, but the increase in product sales has led to a year-on-year increase in company costs and a decline in profits.
Wanhua's main business covers three sectors: polyurethane, petrochemical, fine chemicals and new materials. Polyurethane and petrochemical sectors account for about 40% of revenue respectively.
In the first half of this year, Wanhua chemical polyurethane plate sales of 2.35 million tons, an increase of 13% over the same period last year, sales of 32.77 billion yuan, down about 1%.
Wanhua Chemical said that due to the slowdown in demand in Europe and the United States, the real estate recession in China and other factors, the overall global demand for polyurethane is recovering, and the market demand is basically flat compared with the same period last year.
In the first half of the year, the petrochemical sector sold 6.84 million tons, an increase of 12% over the same period last year, with sales of 36.13 billion yuan, also down 8%. Wanhua Chemical said the overall profitability of the petrochemical industry had been significantly squeezed by factors such as the fall in high oil and gas prices, the weaker-than-expected recovery of Chinese demand and the fact that new capacity was still in a concentrated release period.
Among the three major sectors of Wanhua Chemical, only the revenue of fine chemicals and new materials increased year-on-year, with an operating income of 11.26 billion yuan. Wanhua Chemical believes that with the rapid development of strategic emerging industries such as photovoltaic, wind power, new energy vehicles, VR/AR and other strategic emerging industries, the demand for new chemical materials is increasing, and the industry ushered in a new period of development opportunities.
BASF's earnings in the first half were significantly lower than those in the same period last year.
On July 28th, German chemical giant BASF announced that sales in the first half of the year were 37.3 billion euros, compared with 46.1 billion euros in the same period last year, down 19 percent from the same period last year. Net profit was 2.061 billion yuan, compared with 3.311 billion yuan in the same period last year, down 37.7 percent from the same period last year.
Sales fell 24.7% to 17.3 billion euros in the second quarter, according to the financial report. BASF said the decline in sales was mainly caused by lower prices, particularly in the chemicals business, surface treatment technology business and materials business. Sluggish demand has led to a decline in sales, dragging down sales in all areas of business. In addition, the monetary impact has also reduced sales to some extent.
Earnings before interest and tax before special items in the second quarter of 2023 were 1 billion euros, a decrease of 1.3 billion euros compared with the same period last year; net income was 499 million euros, compared with 2.1 billion euros in the same period last year. BASF said earnings had fallen sharply in almost all areas of the business, particularly in chemicals and materials.
For the second half of the year, BASF does not expect global demand to weaken further in the second half of 2023, as chemical raw material inventories have fallen sharply in most customer industries. But the recovery is short-lived as global demand for consumer goods is expected to grow at a slower rate than previously expected. As a result, margins are expected to remain under pressure.
As a result, BASF downgraded its performance forecast for 2023: sales are expected to be between 73 billion and 76 billion euros (previously forecast between 84 billion and 87 billion euros); EBIT, excluding special items, is expected to be between 4 billion and 4.4 billion euros (previously forecast between 4.8 billion and 5.4 billion euros). Source: Sinochem New Network
Wanhua Chemical's revenue and profit fell in the first half of the year.
On July 28, Wanhua Chemical disclosed that its revenue in the first half of the year was 87.6 billion yuan, down 1.67%, and its net profit was 8.568 billion yuan, down 17.48%.
Wanhua Chemical said that as downstream demand was in the recovery stage, prices fell year-on-year, resulting in a year-on-year drop in revenue. In addition, the decline in raw material prices is limited, but the increase in product sales has led to a year-on-year increase in company costs and a decline in profits.
Wanhua's main business covers three sectors: polyurethane, petrochemical, fine chemicals and new materials. Polyurethane and petrochemical sectors account for about 40% of revenue respectively.
In the first half of this year, Wanhua chemical polyurethane plate sales of 2.35 million tons, an increase of 13% over the same period last year, sales of 32.77 billion yuan, down about 1%.
Wanhua Chemical said that due to the slowdown in demand in Europe and the United States, the real estate recession in China and other factors, the overall global demand for polyurethane is recovering, and the market demand is basically flat compared with the same period last year.
In the first half of the year, the petrochemical sector sold 6.84 million tons, an increase of 12% over the same period last year, with sales of 36.13 billion yuan, also down 8%. Wanhua Chemical said the overall profitability of the petrochemical industry had been significantly squeezed by factors such as the fall in high oil and gas prices, the weaker-than-expected recovery of Chinese demand and the fact that new capacity was still in a concentrated release period.
Among the three major sectors of Wanhua Chemical, only the revenue of fine chemicals and new materials increased year-on-year, with an operating income of 11.26 billion yuan. Wanhua Chemical believes that with the rapid development of strategic emerging industries such as photovoltaic, wind power, new energy vehicles, VR/AR and other strategic emerging industries, the demand for new chemical materials is increasing, and the industry ushered in a new period of development opportunities.
BASF's earnings in the first half were significantly lower than those in the same period last year.
On July 28th, German chemical giant BASF announced that sales in the first half of the year were 37.3 billion euros, compared with 46.1 billion euros in the same period last year, down 19 percent from the same period last year. Net profit was 2.061 billion yuan, compared with 3.311 billion yuan in the same period last year, down 37.7 percent from the same period last year.
Sales fell 24.7% to 17.3 billion euros in the second quarter, according to the financial report. BASF said the decline in sales was mainly caused by lower prices, particularly in the chemicals business, surface treatment technology business and materials business. Sluggish demand has led to a decline in sales, dragging down sales in all areas of business. In addition, the monetary impact has also reduced sales to some extent.
Earnings before interest and tax before special items in the second quarter of 2023 were 1 billion euros, a decrease of 1.3 billion euros compared with the same period last year; net income was 499 million euros, compared with 2.1 billion euros in the same period last year. BASF said earnings had fallen sharply in almost all areas of the business, particularly in chemicals and materials.
For the second half of the year, BASF does not expect global demand to weaken further in the second half of 2023, as chemical raw material inventories have fallen sharply in most customer industries. But the recovery is short-lived as global demand for consumer goods is expected to grow at a slower rate than previously expected. As a result, margins are expected to remain under pressure.
As a result, BASF downgraded its performance forecast for 2023: sales are expected to be between 73 billion and 76 billion euros (previously forecast between 84 billion and 87 billion euros); EBIT, excluding special items, is expected to be between 4 billion and 4.4 billion euros (previously forecast between 4.8 billion and 5.4 billion euros). Source: Sinochem New Network