THE WHAT? BASF is set to register a loss of some -€2,637 million in the third quarter of 2020 due to non-cash-effective impairments and provisions for restructuring, below analyst consensus and the figure for the prior-year quarter.
THE DETAILS The cosmetics ingredients supplier is expecting to book writedowns of €2.8 billion as demand for chemicals falters. Sales were down 5 percent in the third quarter of 2020 to €13,812 million.
For the full year, BASF is expecting sales of €57 billion to €58 billion, versus the €59,316 billion reported in 2019, and EBIT of between €3 billion and €3.3 billion, assuming severe restrictions, such as lockdowns, are not re-introduced.
THE WHY? The specialty chemicals firm attributed the writedowns to ‘considerably weaker macroeconomic developments as a consequence of the coronavirus pandemic’, particularly in the automotive and aviation industries.