BASF's 41% investment over the next five years will be focused on a small decline in sales in the Asia Pacific region in 2019.

BASF's sales for 2019 will be EUR 59.3 billion, down slightly from the previous year, and
BASF predicts that the new coronavirus will have a significant global impact, especially in the first and second quarters of 2020.
over the next five years, BASF will invest 23.6 billion euros, more than a third of which will focus on zhanjiang integration base in Guangdong, chemical industry clusters in Mondra, India, and battery materials.
will accelerate the streamlining of its organizational structure and reduce the number of jobs worldwide by 6,000 by the end of 2021

.
, the executive chairman of BASF Europe, Dr. Dr. Martin Brudermüller) and Chief Financial Officer Dr. Hans-Ulrich Engel released their 2019 financial results.
even in tough times, the company is doing well, " says Mr Bo. With the global economy bucking the trend, 2019 has been a challenging year. "Trade frictions between the US and China have had a negative impact on the global economy, slowing growth in key sales markets and a lot of uncertainty over Brexit. Industrial and chemical production growth slowed sharply from expectations. Demand for customers in many key industries, particularly in the automotive industry, has declined significantly.
" Mr Bo said: "In a difficult market environment,
have improved earnings in all of the company's downstream business areas. However, this did not offset the decline in earnings in the Underlying Chemicals business.revenue before interest and tax on special items in the two main business areas of materials and chemicals was EUR 1.8 billion, a decrease of EUR 2.2 billion. The sharp decline in isocyanate prices, the decline in profits of lysate products, and the planned maintenance of steam cracking devices have all brought significant negative effects.
the first two months of this year, we
the high level of uncertainty facing the global economy," said Mr Bo, head of the BASF Group's 2020 outlook. The new coronavirus, which became popular at the beginning of the year, has become a major impediment to economic growth, especially in China. Prevention and control measures to stop the spread of the epidemic have led to declining demand and production disruptions in many industries. BASF
that the new
virus will have a significant global impact, especially in the first and second quarters

2020.
forecast does not currently take into account the global spread of the virus, which will not only have a significant adverse impact on the global economy in the first half of the year. "We believe the impact of this outbreak will continue throughout the year, " Mr Bo said. BASF
therefore forecasts that global economic growth
will be
2.0%
, a marked slowdown from
2.6%
in
2019

forecasts global chemical production growth of 1.2%
, significantly below the
level of
1.8%

2019.
this would be the slowest increase since the 2008/09
financial crisis.
forecasts that the average price of Brent crude oil will be $60 a barrel, or $1.15 per euro.
Our current environment is challenging and highly uncertain, we will continue to strive to increase sales to between 60 billion and 63 billion euros," he said. The BASF Group's earnings before interest and tax on special projects are expected to be between EUR 4.2 billion and EUR 4.8 billion (2019: EUR 4.5 billion). Return on Capital (ROCE) is expected to be between 6.7 per cent and 7.7 per cent (2019: 7.7 per cent), below the 9 per cent cost-of-capital ratio.
expects a slight increase in most of our customer sectors, however,
we expect production in the automotive sector to continue to decline," said Mr Bo.
" BASF's outlook for 2020 is based on estimates that the trade conflict between the US and its trading partners will not be further eased and that the UK will not have a significant impact on the economy during the Brexit transition period.
investment organic growth
Bo also looked forward to future investment.
the next five years, BASF plans to spend 23
6 billion euros
capital expenditure.
More than a third of these projects will be allocated to key growth areas between
2020

and
2024, with
, two large projects in Asia, an integrated base in Guangdong, China, a chemical industry cluster in Mondra, India, and an investment plan for the battery materials business.
, BASF is conducting research on innovative positive materials for high-performance lithium-ion batteries to make electric transportation a reality.
means that our investment focus will shift regionally, " says Mr Bo. Over the next five years,
will
41% of
investments to the Asia-Pacific region and
34%
to Europe. By , the Asia-Pacific region accounted for 27 per cent of investment during the five-year planning period 2019-2023, compared with 43 per cent in Europe. BASF plans to spend EUR 3.4 billion on capital by 2020 (addition to acquisitions of real estate, plant and equipment, IT investments, restoration obligations arising from leases and right-to-use assets). Capital expenditure in 2019 will be EUR 3.3 billion.
has implemented a number
portfolio measures through active portfolio management.
,

2020


31
, BASF completed its acquisition of solvy polyamide.
acquisition price is 1
3 billion euros.
: BASF will offer a fuller product portfolio, stronger regional influence and a more reliable supply," said Hans-Ulrich Engel
, an industry leader.

has reached an agreement with the
Lone Star
fund to spin off its chemical building materials division for
EUR
3.17 billion, with the transaction expected to be completed by the third quarter of
2020
.
BASF's global pigments business is being part of
DIC
, a Japanese fine chemicals company, for
1.1
5 billion euros, and the deal is expected to close in the fourth quarter of
2020
.
addition, the merger of Wintershall and DEA was completed last year, creating a leading independent exploration and production company in Europe. BASF owns 72.7 per cent of Winterhall Dea and LetterOne 27.3 per cent.
The
is progressing well and will be completed
December
,"
Engel
said.
we expect the
merger to generate synergies of at least
20 billion euros per year by
2022
.
is expected to make an initial public offering
. IPO
) will take place as early
second half
2020, depending on market conditions. BASF
successful acquisition of Bayer-related businesses in the Agricultural Solutions business. "In less
year, the consolidation of the business has been completed," Engel said.
sales of
22
billion euros in
2019, contributing more than
50 billion euros to earnings before interest and tax
on special items. By
2025
, we hope this acquisition will bring in hundreds of millions of euros in additional sales. We are confident that this will be achieved. As
continue to advance the Sustainable
, BASF has set a target of keeping total CO2 emissions unchanged by 2030. This means basing BASF's production increase while keeping greenhouse gas emissions from its production sites unchanged at 2018 levels.

's absolute greenhouse gas emissions fell
8%
to
20 million tons in
2019 compared to
2018, mainly due to the closure of
some large installations for maintenance.
, BASF has updated its energy supply agreements and taken steps to improve energy efficiency and optimize processes.
at BASF's Ludwiggang site, the production sector is using digital chemicals to co-manage production plants.
expected emissions to return to 2018 levels by 2020, in part because of fewer planned overhauls and acquisitions of solvy polyamides.
2019
, we implemented our corporate strategy with full energy and enthusiasm," said
Bo Bo, who has been working with the company to implement BASF's strategy. At the beginning of the new year, we have reformed our organizational structure to reduce complexity, optimize management, and streamline processes. "Most functional services are embedded in business operations.




October, about
20,000
BASF employees had completed their job transformation. In addition,
company has established a lean corporate headquarters with approximately
,000
employees.
New Division of Global
Business Services has also been operational since


,
2020
1
With approximately
,800,
employees, the division provides demand-driven internal services worldwide, such as finance, internal control, procurement and supply chain. This will further enhance BASF's business competitiveness.
has accelerated the "Excellence" project
BASF has accelerated the promotion of "Excellence" projects. "We are optimistic that the project will achieve its target of contributing EUR 20
billion per year in EBITDA to BASF by the end of

2021," Mr Bo said. In
2019, the project achieved earnings before interest, tax, depreciation and amortization of approximately EUR 600 million, with associated costs of approximately EUR 500 million.
, BASF expects the rapid advance of the project this year to bring in earnings before interest, tax, depreciation and amortization of between 1.3 billion and 1.5 billion euros. The one-time investment is expected to be between 300 million and 400 million euros.
also accelerated the streamlining of its organizational structure. BASF announced that it

6,000 jobs worldwide by

2021
2021. This target now appears to be
by
2020. Last year, BASF shed
3,100
the world.
note:
on

, 2019
21
, BASF signed an agreement with
Lone Star
to sell its Chemical Building Materials business, the impact of which is reflected in this report. As of
january
,

2019
, sales and earnings of the Chemical Building Materials business will no longer be included in the BASF Group's sales and earnings before interest, tax, depreciation and amortization, as well as earnings before interest and tax on special items. The figures for the past year, which appear in the present report, have also been adjusted accordingly. Prior to the completion of the transaction, the income of the Chemical Building Materials Business Unit will be presented separately in BASF Group's after-tax income ( "After-tax income from termination of operations").
.