BASF, the world's largest chemicals company by sales, cut its full-year earnings guidance on weak demand and plunging local currencies in China, Brazil and other emerging markets, sending its shares down more than 4 percent.
BASF, whose products include car coatings, foam chemicals, catalytic converters and mining chemicals, said on Tuesday it now expected a slight decrease in 2015 sales and adjusted earnings before interest and taxes.
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BASF had previously forecast flat operating profit and slightly higher sales. But analysts had already been expecting a 2.6 percent adjusted EBIT drop, on average, and a 0.7 percent slide in sales, according to a Reuters poll.
"We experienced a pronounced summer lull and no volume momentum in September. Major markets like Brazil are in a recession, or face lower growth rates, such as China," said Chief Executive Kurt Bock.
BASF shares, which had risen on Monday to a more than two-month high, dropped 4.6 percent to 73.03 euros by 0822 GMT, and were the biggest lowers in a 0.5 percent weaker German blue-chip DAX index.
China's economic growth dipped below 7 percent in the third quarter, hurt by cooling investment and following a stock market plunge and a devaluation of the yuan.
The Asia-Pacific region accounted for 16.5 percent of BASF group sales in the first nine months of the year.
BASF's adjusted EBIT in the quarter through September slipped 10 percent to 1.60 billion euros ($1.8 billion), below the average estimate of 1.63 billion in a Reuters poll.
"The numbers confirmed our cautious view on BASF," said Baader Bank analyst Markus Mayer.
Profit was hurt by lower volumes in the pigments business, weak demand for oil field chemicals and tough competition in vitamins, among other factors.
BASF's crop protection unit took a greater-than-expected hit from a weak Brazil business, after the country's real currency hit an all-time low in September,
Adjusted EBIT at the agribusiness slumped to 7 million euros from 43 million a year earlier, also hurt by the costs of raising production capacity. Analysts had anticipated a slight increase.
Results at rival pesticides makers DuPont and Syngenta had also been dragged lower by Brazil, where farmers are being squeezed by lower crop prices and much higher real-denominated costs of fertilizers and pesticides.
Lower oil prices, normally a boon to chemical companies that rely on petrochemical inputs, hurt BASF because of its oil and gas business, which accounted for 20 percent of 2014 sales.
Quarterly operating income at the oil business dropped by 15 percent to 371 million euros, in line with the market view.
(Editing by Georgina Prodhan and David Holmes)