Chemical giant BASF reported 81.6% drop in second-quarter net income and weaker performance in key segments. Net income fell to €79 million from €430 million a year earlier. BASF generated EBITDA before special items of around €1.8 billion.

The Group’s sales in the second quarter of 2025 amounted to €15.8 billion, €342 million below the level of the prior-year period. The main drivers of this development were negative currency effects as well as lower prices. The decline in prices was largely attributable to the Chemicals segment, whereas prices improved in the Surface Technologies and Nutrition & Care segments. Positive volume growth in the Agricultural Solutions, Surface Technologies and Materials segments partially offset the decline in sales.

“The Agricultural Solutions segment recorded significantly higher earnings and achieved remarkable volume growth of 21 percent compared with the prior-year quarter,” said Dr. Markus Kamieth, Chairman of the Board of Executive Directors of BASF, presenting the quarterly figures together with Chief Financial Officer Dr. Dirk Elvermann.

The Surface Technologies and Nutrition & Care segments achieved slightly higher earnings. In the base chemicals businesses, margins remained under pressure due to high product availability on the market.

Compared with the prior-year quarter, income from operations before depreciation, amortization and special items (EBITDA before special items) decreased by €185 million to €1.8 billion.

This was mainly due to the considerable earnings decline in the Chemicals segment resulting largely from lower margins. The Industrial Solutions and Materials segments also recorded an earnings decline.

By contrast, Agricultural Solutions in particular, but also Surface Technologies achieved earnings growth. The Nutrition & Care segment also recorded an earnings increase. EBITDA before special items in Other fell considerably compared with the prior-year quarter. The EBITDA margin before special items was 11.2 percent following 12.1 percent in the prior-year quarter.

EBITDA amounted to €1.5 billion following €1.6 billion in the prior-year period. In the second quarter of 2025, EBITDA included special items in the amount of minus €297 million. Special charges resulted primarily from structural measures in connection with cost saving programs.

At €494 million, EBIT was €22 million below the prior-year quarter’s figure. The €112 million decline in net income from shareholdings was primarily due to negative earnings contributions from Wintershall Dea GmbH and Harbour Energy plc. The financial result improved by €52 million compared with the prior-year quarter to minus €106 million.

Accordingly, income before income taxes amounted to €316 million, €82 million below the prior-year quarter’s figure. Net income was €79 million, compared with €430 million in the prior-year quarter.

Cash flows from operating activities totaled €1.6 billion in the second quarter, €365 million below the prior-year quarter’s figure. The main reason for the decrease was the change in trade accounts payable.

Compared with the prior-year quarter, cash flows from investing activities improved considerably by €1.0 billion to minus €1.1 billion. This was primarily due to lower payments made for property, plant and equipment and intangible assets, which at €1.1 billion, were €428 million lower than in the prior-year quarter.

“We have now passed the peak investment phase for our South China Verbund site and thus our cash performance will improve accordingly,” said Elvermann. Free cash flow, which is the cash flows from operating activities less payments made for property, plant and equipment and intangible assets, was €533 million in the second quarter of 2025, an increase of €62 million compared with the prior-year period.

Compared with the first half of 2024, BASF Group sales in the first half of 2025 decreased by €493 million to €33.2 billion. The decline was due to negative price developments in four of the six segments, particularly in the Chemicals segment. The Nutrition & Care and Surface Technologies segments recorded a rise in prices. Currencies developed negatively in all segments. Volumes rose, mainly in the Surface Technologies and Agricultural Solutions segments.

The BASF Group’s EBITDA before special items decreased by €272 million in the first half of 2025 and amounted to €4.4 billion. This was mainly attributable to declines in the Chemicals segment. EBITDA was €3.7 billion, compared with €4.2 billion in the prior-year period. At €1.7 billion, EBIT was down €515 million from the prior-year period. Net income was €887 million, compared with €1.8 billion in the prior-year period.

BASF reaffirmed its 2025 adjusted EBITDA guidance of €7.3 billion to €7.7 billion and free cash flow target of €0.4 billion to €0.8 billion.