Business Review
At a glance
- Considerable sales decrease due to lower volumes and prices
- Considerable growth in EBIT before special items in both operating divisions
Sales to third parties in the Surface Technologies segment declined by €1,376 million compared with the previous year to €21,283 million. Sales growth of €780 million to €4,220 million in the Coatings division was unable to compensate for the considerable decrease in the Catalysts division, where sales declined by €2,157 million to €17,062 million.
The segment’s sales decrease was mainly attributable to significantly lower volumes in the Catalysts division’s precious metal trading business. Volume growth in the chemical and refinery catalysts businesses was unable to compensate for this. Sales volumes were significantly higher in the Coatings division, mainly due to improved supply chain conditions in North America and the government stimulus program in China.
The sharp decline in precious metal prices had a negative impact on sales. At €12,336 million, sales in precious metal trading and precious metal sales in the automotive catalysts business1 were considerably below the prior-year figure (€15,726 million) due to lower volumes and prices. Significant price increases across all business areas in the Coatings division, particularly in Europe and in the region South America, Africa, Middle East, were unable to compensate for this.
Currency effects, largely relating to the U.S. dollar and the Chinese renminbi, had a positive impact on sales.
Portfolio effects in the Catalysts division following the acquisition of a majority shareholding in BASF Shanshan Battery Materials on August 31, 2021, also had a positive impact on sales.
1 Sales, volume growth, EBITDA before special items and the EBITDA margin before special items excluding precious metals for the BASF Group and for the Surface Technologies segment are presented under Selected Key Figures Excluding Precious Metals
|
Surface Technologies |
Catalysts |
Coatings |
|---|---|---|---|
Volumes |
–13.0% |
–16.2% |
5.1% |
Prices |
–2.7% |
–5.4% |
12.4% |
Portfolio |
3.4% |
4.1% |
–0.8% |
Currencies |
6.3% |
6.3% |
6.0% |
Sales |
–6.1% |
–11.2% |
22.7% |
|
|
2022 |
2021 |
+/– |
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sales to third parties |
|
21,283 |
22,659 |
–6.1% |
||||||||||
of which Catalysts |
|
17,062 |
19,219 |
–11.2% |
||||||||||
Coatings |
|
4,220 |
3,440 |
22.7% |
||||||||||
Intersegment transfers |
|
198 |
171 |
15.6% |
||||||||||
Sales including transfers |
|
21,481 |
22,831 |
–5.9% |
||||||||||
Income from operations before depreciation, amortization and special items |
|
1,464 |
1,277 |
14.6% |
||||||||||
Income from operations before depreciation and amortization (EBITDA) |
|
1,264 |
1,243 |
1.6% |
||||||||||
EBITDA margin |
% |
5.9 |
5.5 |
− |
||||||||||
Depreciation and amortizationa |
|
651 |
483 |
35.0% |
||||||||||
Income from operations (EBIT) |
|
612 |
761 |
–19.5% |
||||||||||
Special items |
|
–290 |
–39 |
–637.1% |
||||||||||
EBIT before special items |
|
902 |
800 |
12.7% |
||||||||||
Return on capital employed (ROCE) |
% |
3.9 |
5.6 |
− |
||||||||||
Assets |
|
14,899 |
13,769 |
8.2% |
||||||||||
Investments including acquisitionsb |
|
740 |
1,469 |
–49.6% |
||||||||||
Research and development expenses |
|
335 |
296 |
13.1% |
||||||||||
|
||||||||||||||
Surface Technologies – sales
By division
Income from operations (EBIT) before special items rose by €102 million to €902 million. This was driven by considerable earnings growth in both operating divisions. The increase in EBIT before special items in the Catalysts division was largely attributable to higher earnings contributions from the automotive catalysts and battery materials businesses. In the Coatings division, EBIT before special items increased mainly as a result of higher prices in all regions and higher volumes, especially in the automotive OEM coatings business. This more than offset increases in raw materials prices and fixed costs, primarily due to inflation and higher energy costs.
At €612 million, EBIT was €148 million below the prior-year figure. EBIT in 2022 included special charges, mainly for impairments in connection with the agreed divestiture of the production site in De Meern, Netherlands. Other special charges mainly related to the carve-out of the newly established BASF Environmental Catalyst and Metal Solutions unit within the Catalysts division and the integration of the acquired BASF Shanshan companies.
Divisions |
Europe |
North America |
Asia Pacific |
South America, Africa, Middle East |
Total (million €) |
|---|---|---|---|---|---|
Catalysts |
26% |
33% |
36% |
5% |
17,062 |
Coatings |
30% |
25% |
27% |
18% |
4,220 |