Financial Targets and Capital Allocation - BASF confirms its financial targets and aims for shareholder distributions of at least €12 billion between 2025 and 2028, with an annual dividend of at least €2.25 per share[27, 28] - The company targets an EBITDA before special items of €10 billion to €12 billion in 2028, and free cash flow cumulatively exceeding €12 billion from 2025 to 2028[28, 45] - Capital expenditure (including intangibles) is expected to reduce to approximately €16 billion between 2025 and 2028, with over 50% allocated to growth regions, businesses, and the green transformation[31] Cost Savings and Efficiency - BASF is accelerating its cost savings programs, expecting €1.6 billion in annual cost savings by the end of 2025, with cumulative one-time costs of approximately €1.8 billion[37] - The company is implementing a €1 billion Ludwigshafen Cost Improvement Program by 2026[39] Portfolio Management - Core businesses EBITDA bsi 2024 target is €5.4 billion, with a 2028 target of ~€7 billion to ~€9 billion[12] - Standalone businesses EBITDA bsi 2024 target is €3.0 billion, with a 2028 target of ~€3.5 billion to ~€4 billion[12] - Agricultural Solutions aims for IPO readiness by 2027 for a minority share listing, with 2024 sales of €9.8 billion[25, 24] - Coatings business had 2024 sales of €4.3 billion, with a decision expected in Q4 2025 regarding strategic options for remaining activities[23, 20] - Environmental Catalyst and Metal Solutions (ECMS) will be kept longer, with cumulative cash flow of ~€4 billion expected between 2024 and 2030, and 2024 sales of €7.0 billion[16, 13] - Battery Materials sales in 2024 were €0.6 billion, with efforts to reduce fixed costs and capex[19, 17] Operational Improvements and Growth - The Zhanjiang Verbund site is on schedule and below budget, with a total capex budget of €8.7 billion from 2019 to 2028, and is expected to contribute €1.0 billion to €1.2 billion in EBITDA by 2030[53, 51] - BASF aims to streamline net working capital by setting cash flow targets per business, with continuous reduction since 2023[41, 42] - The company has reduced the number of senior executives by 10% and senior employees by 3,000 since 2024[65]

Core Viewpoint - The company reported strong revenue and profit growth in the first half of 2025, driven by its strategic initiatives in global expansion and product competitiveness in the electrolyte and organic fluorine sectors [1][2][3][4]. Financial Performance - In 1H25, the company achieved total revenue of 4.248 billion yuan, an increase of 18.58% year-on-year, and a net profit attributable to shareholders of 484 million yuan, up 16.36% year-on-year [1]. - In 2Q25, total revenue was 2.246 billion yuan, reflecting an 8.65% year-on-year growth, while net profit attributable to shareholders was 254 million yuan, a modest increase of 1.27% year-on-year [1]. Business Segments - The battery chemicals segment generated revenue of 2.815 billion yuan in 1H25, marking a 22.77% year-on-year increase, supported by a global production base of 10 facilities [2]. - The organic fluorine business saw revenue of 722 million yuan in 1H25, a 1.37% year-on-year increase, driven by rising demand in pharmaceuticals and other sectors [3]. - The electronic information chemicals segment reported revenue of 679 million yuan in 1H25, up 25.18% year-on-year, benefiting from increased demand in automation and new energy sectors [4]. Strategic Initiatives - The company is enhancing its global supply chain and production capabilities, with ongoing projects in Malaysia and the U.S. to strengthen its market position [2]. - The company is focusing on vertical integration and expanding its product offerings in the lithium battery electrolyte supply chain, which is expected to lower costs and improve competitiveness [2]. - Future projects in high-end fluorochemical production and semiconductor chemicals are anticipated to bolster the company's market influence and operational efficiency [3][4]. Investment Outlook - The company is positioned as a leading player in the domestic electrolyte industry, with significant growth potential in organic fluorine and semiconductor chemicals [4]. - Projected net profits for 2025 to 2027 are estimated at 1.246 billion, 1.546 billion, and 1.796 billion yuan, respectively, with corresponding price-to-earnings ratios of 28X, 23X, and 20X [4].