BASF said on Friday it slid to a second-quarter net loss on an €800 million impairment against its stake in energy group Wintershall DEA on worsening prospects for oil and gas prices.

 

Sales in the three months through June fell about 12% to €12.7 billion euros, BASF said, beating the average estimate for €11.8 billion euros.

 

Earnings before interest, taxes and some items for the period will be about €226 million euros which is better than analysts’ average estimate for €146 million euros. The decline in EBIT before special items is the result of significantly lower earnings in the Materials, Surface Technologies, Chemicals and Industrial Solutions segments compared with the prior-year quarter.

 

This was mainly driven by lower demand from the automotive industry – the company’s most important customer industry. Europe’s auto industry is facing a historic slump with sales expected to contract a record 25% this year. At BASF, demand from industries including nutrition and personal care are helping soften the blow, as is stable profit in its agricultural products business.