LUDWIGSHAFEN (dpa-AFX) - German chemical company BASF Group (BFA.L, BASFY.PK) said it expects operating result for the second quarter of 2020 to be above market expectations, but net results to be below market expectations due to impairment of shareholding in Wintershall Dea, mainly from oil and gas prices.
The company expects net loss for the second-quarter to be 878 million euros due to a non-cash-effective impairment of the shareholding in Wintershall Dea, considerably below current analyst estimates and the figure for the prior-year quarter of 5.954 billion euros. The impairment of around 800 million euros was the result of lower oil and gas price forecasts and changed reserve estimates.
In the prior-year quarter, net income included a book gain of 5.684 billion euros on the deconsolidation of Wintershall following the merger of Wintershall and DEA as of May 1, 2019.
Quarterly sales declined 12.4 percent to 12.680 billion euros from 14.478 billion euros in the prior year.
EBIT before special items, amounted to an expected 226 million euros, above market expectations and in the range indicated by BASF, but considerably below the figure for the prior-year quarter of 995 million euros.
The BASF Group's EBIT in the second quarter of 2020 amounted to an expected 59 million euros, compared to 507 million euros in the previous year.
The company will publish its half-year financial report on July 29, 2020.
Copyright RTT News/dpa-AFX