BASF (OTCPK:BASF.Y) 2025 Earnings Call Presentation

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]