<b>BASF Group’s EBIT before special items in the third quarter fell by 24% compared with the same period last year, confirming the outlook for the full year 2019</b>

<b>BASF Group '>

-- Sales at EUR 15.2 billion (down 2 percent); Significantly lower earnings in the Products & Materials business areas

-- significantly higher earnings in the Surface Technologies, Agricultural Solutions, Industrial Solutions and Nutrition & Care business areas

-- Confirmation of the full-year outlook for 2019: EBIT before special items is expected to decrease by up to 30% compared to last year

BASF Group sales in the third quarter of 2019 were 15.2 billion euros, a slight decrease compared to the same period last year. This was mainly due to lower prices in the two business areas Materials and Chemicals. Market uncertainties and cautious buying behavior by customers also contributed in part to the decline. Demand from key customer segments has yet to recover. However, BASF managed to maintain sales volumes at the same level as the previous year, thanks to higher volumes in the Agricultural Solutions and Surface Technologies business areas.

At EUR 1.1 billion, EBIT before special items was 24 percent lower than in the prior-year quarter, mainly due to significantly lower earnings in the Materials and Chemicals business area. As expected, the price of isocyanate fell sharply; in addition, the steam cracking unit was overhauled as planned, and the profit of cracking products fell. All of these factors had a significant negative impact on earnings in the two business areas Materials and Chemicals. Dr. Martin Brudermüller, Chairman of the Executive Board of BASF SE, said at the third quarter 2019 financial results presentation: "The company's downstream business unit managed to achieve a performance significantly higher than the same period last year in a difficult market environment. .” In the Industrial Solutions segment, EBIT before special items improved significantly due to lower fixed costs. In the Surface Technology business area, EBIT before special items increased significantly in the three business divisions. In the Nutrition & Care segment, EBIT before special items rose significantly in the segment, driven by significantly higher earnings in the Care Chemicals segment. In the Agricultural Solutions segment, sales rose and EBIT before special items improved significantly, partly due to favorable seasonality in South America.

Earnings before interest, taxes, depreciation and amortization rose to 2.3 billion euros, compared with 2.2 billion euros in the same period last year. EBITDA before special items fell 8 percent to 2.1 billion euros.

At EUR 1.4 billion, EBIT before special items was essentially flat compared to the same period in 2018. Special items in EBIT in the third quarter totaled EUR 257 million, compared with negative EUR 75 million in the same period in 2018. This is mainly attributable to the fact that BASF's considerable income from the sale of shares in the Klybeck base in Basel, Switzerland offset the special expenses incurred in corporate restructuring, integration of Bayer's acquisitions, and asset divestitures.

Net income was EUR 911 million, compared to EUR 1.2 billion in the third quarter of 2018.

Earnings per share fell to 1 euro from 1.31 euros in the same period last year. Adjusted earnings per share came in at 0.86 euros, compared with 1.51 euros a year earlier.

Cash flow from operating activities was EUR 2.0 billion, compared to EUR 2.9 billion in the third quarter of 2018. Free cash flow fell to EUR 1.1 billion, mainly due to lower cash flow from operating activities.

BASF systematically and rapidly implementing new strategies

The global geopolitical environment will continue to pose challenges to BASF. Brudermüller added: "In particular, the Sino-US trade friction will have an impact on our business. In addition, there will be uncertainty from the UK's 'Brexit' process. These factors will slow down economic growth, not only for export-oriented In European countries, the economic slowdown in the United States is also very obvious. The Chinese market is still growing, although the growth rate has slowed down. The output of the global auto industry continues to decline compared with the first half of the year, which was already at a low level.”

Brudermüller said: "Although the unfavorable environment is beyond our control, we are very clear about what we should do within BASF. We are firmly and rapidly promoting relevant progress. BASF is systematically and rapidly adjusting the organizational structure. The goal is to create A streamlined architecture centered on customers.”

2019 is a turning point for BASF. Brudermüller said: "We have used this year to execute our corporate strategy step-by-step quickly with full energy and enthusiasm. We are streamlining our administrative structure, centralizing service functions and regional responsibilities, and simplifying processes. We have already adjusted our organizational structure. Good progress has been made.”

BASF is fast-tracking the corporate strategy it announced a year ago. Most functional services are embedded in business operations. As of October 1, about 20,000 BASF employees have completed the job transition.

Accelerating the 'Excellence' Project

Dr. Hans-Ulrich Engel, Vice Chairman of the Executive Board and Chief Financial Officer of BASF SE: "We have accelerated the 'Excellence' 'Project progress to reachBy the end of 2021, the goal of contributing 2 billion euros to BASF's earnings before interest, taxes, depreciation and amortization per year is currently progressing very smoothly. This year's "Excellence" project will bring about 500 million euros to the company's EBITDA. "However, BASF expects that the project will generate a one-time investment of a corresponding order of magnitude. BASF expects that the contribution of the project to the company's earnings before interest, taxes, depreciation and amortization in 2020 will be between 1 billion and 1.3 billion euros. The one-time investment is expected to It will be between 200 million and 300 million euros.

The greatest contribution to the "Excellence" project will come from production, logistics and planning. Dr. Engel: "In addition, we are streamlining our organization. As of September 2019, BASF had cut 1,800 jobs worldwide. "

BASF Group Outlook 2019

Brudermüller has confirmed the BASF Group's 2019 full-year outlook, that is, BASF's full-year sales are expected to decline slightly; The EBIT of the project is expected to decline by up to 30%; the return on capital (ROCE) for the full year 2019 will be significantly lower compared to last year.

The company slightly adjusted its basic forecast for oil prices: In 2019, BASF expects an average crude oil price (Brent) of $65 per barrel (previously $70).

Other forecasts for the global economic environment remain unchanged (GDP growth: 2.5%; Industrial production growth: 1.5%; chemical production growth: 1.5%; average EUR/USD exchange rate = 1.15 US dollars).