Basf Se S/Adr

Ladies and gentlemen, good morning and a warm welcome to BASF in Ludwigshafen. We are very pleased that you have accepted the invitation to our annual press conference. Some of you could not be present here in Ludwigshafen and will be connected with us live on the internet. So warm welcome to you too. You will be talking today to Markus Komit, Chairman of the Board of Executive Directors, and Dirk Elbermann, the CFO of BASF. The conference, as mentioned, will be broadcast live on the internet, on our homepage and also on LinkedIn. The conference language is German with a simultaneous interpretation into English. During the discussion later, English questions will be answered in English. So if you're using a headset for the simultaneous interpretation or want to use, then you find the English channel on channel 1 and the German channel on channel 2. For the photographers here in the room during the first five minutes, you can take photos during the presentation. But afterwards or during these photos, please switch off the flashlight and afterwards, please take your seats. All accredited guests should have received an electronic press folder with all the important documents via email. And that's all on housekeeping. And I give the floor to you, Markus.

Thank you, Andreas. Good morning and welcome to Ludwigshafen and also to those in front of the monitors. First of all, thank you, Andreas, for you for having taken over this job. You are doing this for the first time or have been doing this for the first time for a long time because Nina Schwab-Hautzinger left to join Roche, but you probably... heard yesterday that we will welcome Thomas Biege as successor of Nina Schwab-Hautzinger soon and I think in future he will take this job but well you will have to agree with him. Dirk Elbermann and I will present and explain the most important figures and developments of the 2025 business year. 2025 marked by many geopolitical and headwinds in the world that unfortunately had a negative impact. Consequently, we in the chemical industry faced an uncertain and very volatile global market environment and with considerable headwinds. As previously stated, we therefore focus primarily on the things we can control within the framework of our winning way strategy. We successfully started up the major assets at our new verbund site in Sanjiang, and we also accelerated our cost savings programs and significantly streamlined BASF's organization. Moreover, we progressed swiftly and successfully with the announced portfolio measures. But let me also mention that the year 2025 and particularly the fourth quarter did not develop as we had anticipated. Our pre-release on January 22nd already gave you an indication of this. Let's now turn to the details of BSF's financial performance in the fourth quarter of 2025, always compared with the prior year quarter. Overall, sales declined considerably because of strong currency headwinds and slightly lower prices. At the same time, we achieved slightly higher volumes. All segments reported volume growth except for the chemical segment. Volumes rose particularly in surface technology, agricultural solutions and nutrition and care segments. From a regional perspective, we achieved a remarkable volume increase of 13% in China and posted solid growth in North America. In Europe, we recorded slightly lower sales volumes. Compared with the fourth quarter of 2024, prices declined in five of our six segments, most notably in chemicals and materials, due to ongoing competitive pressure. We could only increase prices in the surface technology segment, primarily owing to higher precious metal prices. Currency effects burden sales in all divisions and were mainly caused by the strong depreciation of the US dollar, the Chinese renminbi, and Indian rupee. Portfolio effect slightly dampened sales growth and this was mostly related to the sale of our decorative paints business. Based on this underlying sales development EBITDA before special items came in at 1 billion euros compared with 1.4 billion in the prior year quarter. Currency headwinds lowered EBITDA before special items in the fourth quarter of 2025 by around 110 million euros. Ladies and gentlemen, overall, BSF Group's EBITDA before special items reached €6.6 billion in the full year of 2025. The decline compared with 2024 was mainly due to lower margins and negative currency effects, and the latter amounted to €235 million in the full year 2025. Due to continued low market demand and pressure on margins, earnings in BSF's core businesses, especially in the chemical segment, declined considerably. Higher contributions from BSF's standalone businesses could only partially compensate for this decrease. Let's now turn to our portfolio measures. Our agreement with Carlyle marks an important milestone in realizing the full value of our coatings business. Prior to that, we had divested our decorative paints business to Sherwin-Williams. Under Carlyle's operational leadership, we want to continue to strengthen the leading position of the coatings business. This will create further upside potential for the 40% equity share we will continue to hold after closing. We are on track to close the transaction in the second quarter as previously announced. On the basis of the two transactions, BSF's coatings business is valued at an enterprise value of 8.7 billion euros. Let's move on to agricultural solutions. Our team here once again delivered a very strong performance in 2025 and achieved an EBITDA margin before special items of 22%. We are on track to reach IPO readiness in 2027. Last year, excellent progress was made on the legal NTT and ERP separation. By early 2027, the separation will be completed in all regions. In November, we announced the future management board for the ag business. Its members combine extensive industry expertise with the required capital market experience. The management team, headed by Livo Tedeschi, will drive the transformation of Ag Solutions into an independently steered company focusing solely on the agricultural sector. The planned listing of our agricultural solutions business will mark the next decisive step to unlock additional value for our shareholders. The planned IPO is targeted to take place on the Frankfurt Stock Exchange. And what is also good news is another piece of news. In January, we announced that BSF Agricultural Solutions is acquiring AgbiTech, a supplier of biological solutions to control insect pests. It has pioneered the use of nuclear polyhidrovirus technology to develop insect control solutions based on naturally occurring viruses. With operations in Brazil, the United States and Australia, Agbiotech serves farmers growing soybean, corn and cotton as well as specialty crops. This acquisition is an important step in the value creation journey of agricultural solutions. The new technology will complement BSF's existing biosolutions portfolio and underscores the commitment to a more sustainable, holistic approach in agriculture, in line with the business strategy of AgSolutions. The transaction is expected to close in the first half of 2026. From the standalone ag business, let's return to the beginnings of our value chain. We successfully started up all 32 key production lines at our Zhangjiang for Bund site on time and below budget. A remarkable achievement and a testament to the capabilities of our teams. We also started up the steam cracker, the heart of the Verbund, without any lost time. This steam cracker is flexible, so we can use both nafta and butane as feedstocks. I was very pleased to hear Linde's CEO, Sanjeev Lamba, describe this as one of the fastest cracker startups ever. Linde supports us with their cracker technology and engineering expertise and contributed to this major achievement of our teams in Sanjang. The team executed this complex task with outstanding dedication and success. We are confident that we will operate the site at high utilization rates even in the current market environment. Nevertheless, I want to note that we expect a slightly negative earnings contribution from the Sanjiang Forbund site in the first year of operations, mainly due to startup-related costs. From 2027, we accept the site to contribute positive earnings. Ladies and gentlemen, MDI is an important product for BSF and a key component of our polyurethane value chain. It is indispensable in the construction, automotive, coatings, adhesives, and furniture sectors. Classic applications include rigid and flexible foams. It can be found as insulation and upholds free material in your car. For example, I think you're not sitting on such a chair at the moment. In the United States, we are currently expanding our MDI plant in Geismar, Louisiana. The final phase is on track, and we are planning to start up production in the third quarter of 2026. At 1 billion U.S. dollars in total, the project marks BASF's largest investment ever in the United States. Through this expansion, we are doubling our MDI capacity in Geismar to around 600,000 metric tons per year to serve the growing U.S. market. With that, I will hand over to Dirk Elvermann.

Ja, vielen Dank.