6-K UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
February 22, 2006
BASF AKTIENGESELLSCHAFT
(Exact name of Registrant as Specified in its Charter)
BASF CORPORATION
(Translation of Registrant's name into English)
Carl Bosch Strasse 38, LUDWIGSHAFEN, GERMANY 67056
(Address of Principal Executive Offices)
Indicate by check mark whether the Registrant files or will file annual
reports under cover Form 20-F or Form 40-F
Form 20-F |X| Form 40-F |_|
Indicate by check mark whether the Registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes |_| No |X|
If "Yes" is marked, indicate below the file number assigned to the
Registrant in connection with Rule 12g3-2(b): 82- .
BASF in Top Form: Record Earnings in 2005, Confident Outlook for 2006
LUDWIGSHAFEN, Germany--(BUSINESS WIRE)--Feb. 22, 2006--BASF
(NYSE:BF)(FWB:BAS)(LSE:BFA):
-- Record sales (up 14 percent) and record EBIT before special
items (up 17 percent)
-- Premium earned on cost of capital
-- Cash provided by operating activities increases further (up 13
percent)
-- Board of Executive Directors proposes to increase dividend by
30 euro cents to EUR 2.00 per share
-- BASF optimistic for full year 2006
BASF - The Chemical Company - posted the best results in its
history in 2005. The company again grew profitably and faster than the
market in 2005 on the basis of its own efforts and astute
acquisitions. At its Annual Press Conference on February 22, 2006 in
Ludwigshafen, BASF reported sales of EUR 42.7 billion (up 14 percent)
and income from operations (EBIT) before special items of more than
EUR 6.1 billion (up 17 percent).
"Our results speak for themselves. We increased the premium earned
on our cost of capital to just under EUR 2.4 billion, and I would like
to thank the entire BASF team for its outstanding achievements," said
Dr. Jurgen Hambrecht, Chairman of BASF's Board of Executive Directors.
Board of Executive Directors proposes higher dividend
The capital markets also had a favorable opinion of BASF's
achievements: BASF shares increased in value by 26.2 percent in 2005
and outperformed the EURO STOXXSM 50 Total Return Index. The company
wants to offer its shareholders an attractive dividend for fiscal year
2005. The Board of Executive Directors is therefore recommending to
the Supervisory Board to propose to the Annual Meeting an increased
dividend of EUR 2.00 per share - 30 euro cents more than in 2004.
Outlook for the full year 2006
Hambrecht's top priority is to ensure BASF's long-term
competitiveness. We will therefore proceed with our
efficiency-enhancing measures and restructuring programs," he said.
Looking to the full year, Hambrecht is confident: "We aim to
continue to grow faster than the market, follow on from the strong
level of income from operations before special items posted in 2005,
and again earn a premium on our cost of capital."
Chemicals segment posts record sales
With an increase of 15.4 percent compared with 2004, the Chemicals
segment posted record sales as a result of higher volumes and prices.
The Plastics segment recorded significantly higher EBIT, which was
up 46 percent on the previous year. The pressure on margins increased
toward the end of the year due to high and volatile raw material
prices.
The Performance Products segment benefited from BASF's Verbund and
its increasingly strong position in Asia. In 2005, the decline in
sales caused by the divestiture of the printing systems business in
the previous year was more than compensated for.
In the Agricultural Products & Nutrition segment, earnings in the
Agricultural Products division rose despite higher spending on
research and development. In the Fine Chemicals division, lower prices
in important product lines significantly impacted sales and earnings.
The company has launched an extensive restructuring program in this
division and expects higher sales and earnings in 2006.
Sales and earnings in the Oil & Gas segment grew by double-digit
amounts and reached new highs. This was due to the significant rise in
oil prices, increased oil and gas production and the expansion of the
natural gas trading business.
Significant sales growth in all regions
In 2005, sales by location of company grew by double-digit rates
in Europe (plus 11 percent), North America (plus 17 percent) and Asia
Pacific (plus 23 percent). Sales in South America, Africa, Middle East
rose 7 percent.
Earnings growth in North America was particularly strong: EBIT
tripled compared with the previous year. The target of reducing fixed
costs by $250 million was achieved ahead of schedule. BASF is
continuing with its programs to increase efficiency and has now set
itself the goal of saving additional costs of $150 million per year by
mid-2007.
The improvement in EBIT in Europe was due above all to growth in
BASF's oil and gas business and plastics operations, as well as to
cost-saving programs.
In Asia, EBIT declined by 18 percent compared with 2004. This was
mainly due to a difficult market environment for intermediates as well
as high and volatile raw material costs for styrenics. Earnings were
also negatively impacted by special items, for example for the planned
closures of the THF and PolyTHF(R) plants in Yokkaichi, Japan.
Earnings declined slightly in the South America, Africa, Middle
East region, where the agricultural products business was affected by
dry weather in Brazil and Argentina.
Current share buyback program completed
Chief Financial Officer Dr. Kurt Bock explained the factors that
influenced BASF's sales growth. Apart from a sustained, satisfactory
increase in sales volumes of 2.5 percent, the development was due
primarily to higher prices in nearly all areas of BASF's portfolio.
Currency effects once again played an important role in the fourth
quarter, but had only a minor overall impact on sales for the full
year.
Cash provided by operating activities before external financing of
pension obligations increased to EUR 5.25 billion. This increase of
13.3 percent was mainly due to BASF's significantly higher earnings.
BASF also continued to buy back shares in 2005, returning
approximately EUR 1.4 billion to its shareholders in this way. In
2005, the company bought back more than 26 million shares at an
average price of EUR 55.05. As a result, it has reduced the number of
outstanding shares by 19.8 percent since starting its share buyback
programs in 1999.
In 2006, BASF continued with the EUR 1.5 billion share buyback
program that it announced in April 2005. Between the start of the year
and the middle of February, it bought back just under 5.4 million
shares for EUR 339 million, thus completing the program as planned.
BASF's Board of Executive Directors will request further authorization
to repurchase shares at the Annual Meeting in May 2006.
BASF is the world's leading chemical company: The Chemical
Company. Its portfolio ranges from chemicals, plastics, performance
products, agricultural products and fine chemicals to crude oil and
natural gas. As a reliable partner to virtually all industries, BASF's
intelligent system solutions and high-value products help its
customers to be more successful. BASF develops new technologies and
uses them to open up additional market opportunities. It combines
economic success with environmental protection and social
responsibility, thus contributing to a better future. In 2005, BASF
had approximately 81,000 employees and posted sales of more than EUR
42.7 billion. BASF shares are traded on the stock exchanges in
Frankfurt (BAS), London (BFA), New York (BF) and Zurich (AN). Further
information on BASF is available on the Internet at www.basf.com.
BASF will publish its Financial Report and Corporate Report on
March 14, 2006.
On February 22, 2006, you can obtain further information on the
Internet at the following addresses:
Annual press conference report (from 7:30 a.m. CET)
-- corporate.basf.com/pcon-report (English)
-- corporate.basf.com/pk-bericht (German)
Press release (from 7:30 a.m. CET)
-- corporate.basf.com/pressrelease (English)
-- corporate.basf.com/pressemitteilungen (German)
Live transmission Annual Press Conference (from 10:30 a.m. CET)
-- corporate.basf.com/pcon (English)
-- corporate.basf.com/pk (German)
Speech Dr. Jurgen Hambrecht/Dr. Kurt Bock - print version (from
11:30 a.m. CET)
-- corporate.basf.com/pressconference (English)
-- corporate.basf.com/pressekonferenz (German)
Photos (from 7:30 a.m. CET)
-- corporate.basf.com/photos (English)
-- corporate.basf.com/fotos (German)
Photos from the Annual Press Conference (from 1:00 p.m. CET)
-- corporate.basf.com/photos (English)
-- corporate.basf.com/fotos (German)
Information about BASF shares
-- www.basf.com/share (English)
-- www.basf.com/aktie (German)
Live transmission Analyst Conference (from 3:00 pm CET)
-- www.basf.com/share (English)
-- www.basf.com/aktie (German)
Important figures from Annual Press Conference Report
----------------------------------------------------------------------
Change
Million EUR 2005 2004 in %
----------------------------------------------------------------------
Sales 42,745 37,537 13.9
----------------------------------------------------------------------
Income from operations before interest, taxes,
depreciation
and amortization (EBITDA) 8,233 7,685 7.1
----------------------------------------------------------------------
Income from operations (EBIT) before special items 6,138 5,230 17.4
----------------------------------------------------------------------
Income from operations (EBIT) 5,830 5,193 12.3
----------------------------------------------------------------------
Income before taxes and minority interests 5,926 4,347 36.3
----------------------------------------------------------------------
Net income 3,007 2,004 50.0
----------------------------------------------------------------------
Earnings per share (EUR) 5.73 3.65 57.0
----------------------------------------------------------------------
Income from operations (EBIT) before special items
in percent of sales 14.4 13.9 -
----------------------------------------------------------------------
Cash provided by operating activities 5,250* 4,634 13.3
----------------------------------------------------------------------
Additions to fixed assets** 2,523 2,163 16.6
----------------------------------------------------------------------
Excluding acquisitions 1,937 2,071 (6.5)
----------------------------------------------------------------------
Amortization and depreciation** 2,403 2,492 (3.6)
----------------------------------------------------------------------
Segment assets (as of December 31)*** 29,180 26,300 11.0
----------------------------------------------------------------------
Personnel costs 5,574 5,615 (0.7)
----------------------------------------------------------------------
Number of employees (as of December 31) 80,945 81,955 (1.2)
----------------------------------------------------------------------
* Before external financing of pension obligations (see page 19)
** Tangible and intangible fixed assets (including acquisitions)
*** Tangible and intangible fixed assets, inventories and
business-related receivables
Segment overview Sales Income from Income from
operations operations
before (EBIT)
interest, before
taxes, special
depreciation items
and
amortization
(EBITDA)
-------------------------------
Million EUR 2005 2004 2005 2004 2005 2004
----------------------------------------------------------------------
Chemicals 8,103 7,020 1,942 1,857 1,488 1,377
----------------------------------------------------------------------
Plastics 11,718 10,532 1,504 1,193 1,031 752
----------------------------------------------------------------------
Performance Products 8,267 8,005 1,227 1,503 890 850
----------------------------------------------------------------------
Agricultural Products &
Nutrition 5,030 5,147 996 1,093 693 763
----------------------------------------------------------------------
Thereof Agricultural
Products 3,298 3,354 907 887 671 666
----------------------------------------------------------------------
Fine Chemicals 1,732 1,793 89 206 22 97
----------------------------------------------------------------------
Oil & Gas 7,656 5,263 2,859 2,098 2,410 1,653
----------------------------------------------------------------------
Other* 1,971 1,570 (295) (59) (374) (165)
----------------------------------------------------------------------
Thereof costs of exploratory
and
biotechnological research - - - - (225) (168)
----------------------------------------------------------------------
42,745 37,537 8,233 7,685 6,138 5,230
----------------------------------------------------------------------
Segment overview Income from Assets Capital
operations expenditures**
(EBIT)
-----------------------------
Million EUR 2005 2004 2005 2004 2005 2004
----------------------------------------------------------------------
Chemicals 1,326 1,284 6,146 5,219 639 601
----------------------------------------------------------------------
Plastics 1,015 694 6,639 6,187 490 473
----------------------------------------------------------------------
Performance Products 863 1,128 4,863 4,538 347 304
----------------------------------------------------------------------
Agricultural Products &
Nutrition 623 658 6,637 6,293 296 253
----------------------------------------------------------------------
Thereof Agricultural
Products 681 602 5,156 4,985 74 100
----------------------------------------------------------------------
Fine Chemicals (58) 56 1,481 1,308 222 153
----------------------------------------------------------------------
Oil & Gas 2,410 1,643 4,895 4,063 624 388
----------------------------------------------------------------------
Other* (407) (214) 6,490 9,148 127 144
----------------------------------------------------------------------
Thereof costs of
exploratory and
biotechnological research (225) (168) - - - -
----------------------------------------------------------------------
5,830 5,193 35,670 35,448 2,523 2,163
----------------------------------------------------------------------
* "Other" includes the fertilizers business and other businesses as
well as expenses, income and assets not allocated to the segments
This item also includes foreign currency results from financial
indebtedness that are not allocated to the segments as well as
from currency positions that are macro-hedged ((EUR)(97) million,
previous year (EUR)(54) million).
** Capital expenditures in tangible assets (thereof (EUR)329 million
from acquisitions in 2005) and intangible assets (thereof (EUR)257
million from acquisitions in 2005).
Region Sales by Sales by Income from
location of company location of customer operations
(EBIT)
------------
Change Change Change
Million EUR 2005 2004 in % 2005 2004 in % 2005 2004 in %
----------------------------------------------------------------------
Europe 25,093 22,536 11.3 23,755 21,343 11.3 4,385 4,236 3.5
----------------------------------------------------------------------
Thereof
Germany 17,100 15,216 12.4 8,865 7,382 20.1 3,019 3,131 (3.6)
----------------------------------------------------------------------
North
America
(NAFTA) 9,542 8,165 16.9 9,479 8,182 15.9 855 286 199.0
----------------------------------------------------------------------
Asia
Pacific* 6,042 4,911 23.0 6,500 5,309 22.4 297 361 (17.7)
----------------------------------------------------------------------
South
America,
Africa,
Middle
East* 2,068 1,925 7.4 3,011 2,703 11.4 293 310 (5.5)
----------------------------------------------------------------------
42,745 37,537 13.9 42,745 37,537 13.9 5,830 5,193 12.3
----------------------------------------------------------------------
* Effective January 1, 2005, companies in Asia are reported in the
region 'Asia Pacific.' South America, which was previously reported
separately, is now reported together with the geographic regions
Africa and Middle East in the region 'South America, Africa, Middle
East.'
Key BASF share data 2001 2002 2003 2004 2005
----------------------------------------------------------------------
Year-end price (EUR) 41.75 36.08 44.58 53.00 64.71
----------------------------------------------------------------------
Year high (EUR) 50.45 49.80 44.58 53.00 65.33
----------------------------------------------------------------------
Year low (EUR) 31.00 32.90 28.41 40.49 50.11
----------------------------------------------------------------------
Year average (EUR) 44.66 42.37 38.52 45.18 57.13
----------------------------------------------------------------------
----------------------------------------------------------------------
Daily trade in shares(1)
----------------------------------------------------------------------
- million EUR 108.54 129.67 127.20 121.74 153.98
----------------------------------------------------------------------
- million shares 2.48 3.09 3.33 2.71 2.70
----------------------------------------------------------------------
----------------------------------------------------------------------
Number of shares as of December 31
(million shares) 583.40 570.32 556.64 541.24 515.06
----------------------------------------------------------------------
Market capitalization as of
December 31 (billion EUR ) 24.36 20.58 24.8 28.69 33.33
----------------------------------------------------------------------
----------------------------------------------------------------------
Earnings per share (EUR)(2) 9.72(3) 2.60 1.62 3.43 5.73
----------------------------------------------------------------------
Dividend per share (EUR) 1.30 1.40 1.40 1.70 2.00*
----------------------------------------------------------------------
Dividend yield (%)(4) 3.11 3.88 3.14 3.21 3.09
----------------------------------------------------------------------
Distribution quota (%)(2) 12.9 52.5 85.1 48.0 34.2
----------------------------------------------------------------------
Price-earnings ratio (P/E ratio)(2) 4.30 13.88 27.52 15.45 11.29
----------------------------------------------------------------------
----------------------------------------------------------------------
Key data for BASF ADRs(5)
----------------------------------------------------------------------
Year-end price ($) 37.91 38.22 55.75 72.02 76.48
----------------------------------------------------------------------
Year high ($) 46.73 46.85 55.75 72.02 77.26
----------------------------------------------------------------------
Year low ($) 28.80 32.40 32.00 48.42 63.68
----------------------------------------------------------------------
Year average ($) 40.05 39.90 43.81 56.39 70.91
----------------------------------------------------------------------
----------------------------------------------------------------------
Daily trade in shares
----------------------------------------------------------------------
- million $ 2.36 3.08 4.54 4.03 8.99
----------------------------------------------------------------------
- thousand shares 59.98 78.73 105.32 71.80 126.81
----------------------------------------------------------------------
1 Average, Xetra trading
2 Starting in 2005, the accounting and reporting of the BASF Group
is performed in accordance with International Financial Reporting
Standards (IFRS). The previous year's figure has been restated
accordingly. The change in accounting and reporting of the BASF Group
is explained in detail in Note 3 to the Consolidated Financial
Statements on page 106 ff.
3 Including extraordinary income of (EUR)9.92 per share
4 Based on year-end share price
5 BASF shares are traded on the New York Stock Exchange in the
form of ADRs (American Depositary Receipts). Each BASF ADR is
equivalent to one BASF share.
* Proposed dividend
Sales and earnings by quarter
----------------------------------------------------------------------
2005
1st 2nd 3rd 4th
Million EUR Quarter Quarter Quarter Quarter 2005
----------------------------------------------------------------------
Sales 10,083 10,581 10,361 11,720 42,745
----------------------------------------------------------------------
Income from operations (EBIT)
before special items 1,563 1,657 1,327 1,591 6,138
----------------------------------------------------------------------
Income from operations (EBIT) 1,499 1,587 1,262 1,482 5,830
----------------------------------------------------------------------
Financial result 45 (82) 176 (43) 96
----------------------------------------------------------------------
Income before taxes and
minority interests 1,544 1,505 1,438 1,439 5,926
----------------------------------------------------------------------
Net income 861 778 808 560 3,007
----------------------------------------------------------------------
Earnings per share (EUR) 1.60 1.48 1.55 1.10 5.73
----------------------------------------------------------------------
2004
1st 2nd 3rd 4th
Million EUR Quarter Quarter Quarter Quarter 2004
----------------------------------------------------------------------
Sales 9,051 9,314 9,314 9,858 37,537
----------------------------------------------------------------------
Income from operations (EBIT)
before special items 1,175 1,266 1,172 1,617 5,230
----------------------------------------------------------------------
Income from operations (EBIT) 1,075 1,250 1,076 1,792 5,193
----------------------------------------------------------------------
Financial result (40) 12 (127) (691) (846)
----------------------------------------------------------------------
Income before taxes and
minority interests 1,035 1,262 949 1,101 4,347
----------------------------------------------------------------------
Net income 520 714 366 404 2,004
----------------------------------------------------------------------
Earnings per share (EUR) 0.94 1.30 0.67 0.74 3.65
----------------------------------------------------------------------
This release contains forward-looking statements under the U.S.
Private Securities Litigation Reform Act of 1995. These statements are
based on current expectations, estimates and projections of BASF
management and currently available information. They are not
guarantees of future performance, involve certain risks and
uncertainties that are difficult to predict and are based upon
assumptions as to future events that may not prove to be accurate.
Many factors could cause the actual results, performance or
achievements of BASF to be materially different from those that may be
expressed or implied by such statements. Such factors include those
discussed in BASF's Form 20-F filed with the Securities and Exchange
Commission. (The Annual Report 2005 on Form 20-F will be available on
the Internet at corporate.basf.com as of March 14, 2006.) We do not
assume any obligation to update the forward-looking statements
contained in this release.
CONTACT: BASF
Michael Grabicki, +49 621 60-99938
Fax: +49 621 60-92693
michael.grabicki@basf.com
or
Daniel Smith
Phone: +49 621 60-20829
Fax: +49 621 60-92693
daniel.smith@basf.com
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Current Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BASF Aktiengesellschaft
Date: February 22, 2006 By: /s/ Elisabeth Schick
------------------------------------
Name: Elisabeth Schick
Title: Director Site Communications Ludwigshafen
and Europe
By: /s/ Christian Schubert
------------------------------------
Name: Christian Schubert
Title: Director Corporate Communications
BASF Group