BASF's "Winning Strategy" One-Year Assessment: Clear Restructuring Path for Four Major Business Segments; Today PC Continues to Rise Against the Trend, Up 300

On the first anniversary of the "Winning Ways" strategy, BASF held a capital market update meeting in Antwerp, Belgium, systematically disclosing the development paths of its four independent business segments and core business efficiency enhancement plans. The company confirmed that it will maintain its 2028 financial targets and revealed that the results of the strategic evaluation of its coatings business, which has garnered significant market interest, will be officially announced in this quarter.

Dr. Markus Kamieth, Chairman of the Executive Board of BASF Europe, stated in his keynote speech: "The past 12 months have proven that we are focusing on the right issues. The execution of our strategy is progressing well, and we are confident in achieving our 2028 goals." He emphasized that BASF is solidifying the foundation for sustainable profit growth through precise business portfolio management, capital allocation, and performance culture development.

Four major independent business paths are clear.

Kamieth highlighted the latest developments of the company's four independent businesses in his speech.

Environmental Catalysts and Metal Solutions Business: BASF has decided to retain this business, recognizing itself as the best operator. This independently operating business in 2023 is expected to generate 7 billion euros in revenue in 2024 and is projected to produce approximately 4 billion euros in cumulative cash flow from 2024 to 2030.

Battery materials business: The department's sales for 2024 are expected to be 600 million euros. By significantly reducing fixed costs and capital expenditures, and signing agreements with key customers such as CATL to enhance the utilization of existing capacity, BASF is actively exploring partnership opportunities along the value chain.

Coatings business: The sale of its Brazilian decorative coatings business to Sherwin-Williams was completed on October 1, 2025, for $1.15 billion (cash transaction and debt-free). In the second quarter of 2025, BASF initiated a strategic options evaluation for its automotive OEM coatings, automotive refinish coatings, and surface treatment business, which achieved sales of €3.8 billion in 2024. Relevant decisions are expected to be made in the fourth quarter.

Agricultural Solutions business: The sales for this division are expected to be 9.8 billion euros in 2024, and BASF aims to prepare for a minority IPO by 2027. The company is currently making good progress in the legal entity separation and the implementation of an industry-specific ERP system.

The commitment to shareholder returns continues to strengthen.

BASF reaffirmed its financial targets for shareholder returns based on the announcement in September 2024: under moderate to favorable market conditions, the target for EBITDA before special items in 2028 is between €10 billion and €12 billion, cumulative free cash flow from 2025 to 2028 is expected to exceed €12 billion, and the return on invested capital in 2028 is approximately 10%.

BASF confirmed that its annual dividend per share will not be less than €2.25 from 2025 to 2028, with a total dividend amount of approximately €8 billion during this period. At the Capital Markets Day in September 2024, BASF also committed to repurchasing at least €4 billion worth of shares between 2027 and 2028. BASF has now indicated that it may initiate the share repurchase plan earlier, depending on the progress of the coatings business transaction.

"Successful portfolio measures will enable us to strengthen the balance sheet and potentially accelerate share buybacks," said BASF Chief Financial Officer Dr. Dirk Elvermann. "We have already gained proceeds from the sale of the decorative paints business and the food and health nutritional ingredients business. We will continue to unlock value from oil and gas assets and actively explore strategic options for the coatings business. Additionally, we are preparing for a partial listing of the agricultural solutions business."

BASF maintains a prudent approach to capital allocation: it has revised its expected spending on real estate, plant equipment, and intangible assets from approximately €17 billion to €16 billion for the period from 2025 to 2028. The integrated base project located in Zhanjiang, southern China, is progressing as planned with expenditures below budget, and the total capital spending from 2019 to 2028 has been reduced by €1.3 billion to around €8.7 billion. Most facilities are expected to be operational by the end of 2025.

Core Business Efficiency Improvement Plan Launched

In the medium to long term, the Zhanjiang site will play a key role in strengthening BASF's core business, which is also the core of Kamieth's closing remarks.

In 2024, the core businesses, consisting of the four segments of Chemicals, Materials, Industrial Solutions, and Nutrition & Care, achieved sales of 40.3 billion euros. From upstream to downstream, these businesses are deeply integrated into long-chain, multi-stage value chains such as ethylene oxide and polyurethane.

"This integrated consolidation and multi-technology application bring cost advantages, competitiveness, and products with a lower carbon footprint to BASF," Kamieth emphasized. To address performance gaps in certain parts of the value chain, BASF is improving by shutting down loss-making facilities, starting up competitive new capacities, and exploring strategic options. These measures are expected to boost the core business profit by approximately 400 million euros by 2028.

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(The above is compiled from Huizheng Information and Dayi You Su.)