As the world's largest chemical company BASF is considered a bellwether for the industry, and analysts welcomed its assessment that the global economy seems to be improving.
Group sales were up 3.6 per cent to €33.36 billion - even factoring in the oft-lamented effect of the weak dollar compared to the euro - with operating earnings up marginally at €2.66 billion.
And Hambrecht noted that rising sales volumes in the fourth quarter (by 6.5 per cent to €8.54 billion), as well as encouraging sales trends in the first two months of this year, pointed to better things ahead.
"Throughout the world, the economy seems to have bottomed out," said Hambrecht, adding that the growth markets in Asia and the US are fuelling the global recovery process.
The company's pharmaceutical activities are spread between its Chemicals division, which reported sales up 8.5 per cent to €5.75 billion in 2003, and the fine chemicals unit of the Agricultural Products and Nutrition division. The latter saw turnover rise 7.5 per cent to €3.18 billion last year.
Within chemicals, inorganics sales reached €738 million, up 6 per cent and boosted by the acquisition last September of Callery Chemicals which makes boron and potassium compounds used in the manufacture of pharmaceuticals.
Meanwhile, fine chemicals - which includes BASF's activities in nutrition and cosmetic ingredients - saw sales fall 6.3 per cent to €1.85 billion, adversely impacted by falling sales to North America because of the weak dollar.
Hambrecht said that BASF is expecting slightly higher sales and profits in 2004, resting on its assumption that crude oil used as a raw material would have an average price of around $28 a barrel in 2004 and continued downward pressure on the dollar.
Restructuring progress
Meanwhile, BASF has completed the first phase of its restructuring drive in North America aimed at reducing fixed costs by $250 million annually by 2006 and the loss of 1,000 jobs. The completion will lead to cost savings of $100 million in 2004, said the company.
