We expect slight sales growth in the Chemicals segment in 2020, mainly driven by higher volumes. We anticipate improved availability of steam cracker products, as volumes development in 2019 was negatively impacted by the scheduled turnarounds of our steam crackers in Port Arthur, Texas; Antwerp, Belgium; and Ludwigshafen, Germany. In addition, our planning assumes higher sales volumes of oxo alcohols in the Petrochemicals division, and in almost all business areas in the Intermediates division. Prices in both divisions will however decline due to high product availability on the market. Consequently, EBIT before special items will presumably be considerably below the 2019 level as a result of lower margins.
In the Materials segment, we expect considerable year-on-year sales growth in 2020, mainly driven by the positive contribution from the acquisition of Solvay’s integrated polyamide business. We also anticipate higher volumes overall. Lower prices and currency effects should dampen sales development. We expect a considerable decline in EBIT before special items due to a considerably lower contribution from the Monomers division on the back of lower margins and higher fixed costs. The expected increase in fixed costs will be from higher depreciation and amortization following the acquisition of Solvay’s integrated polyamide business, new plants and one-off effects. The higher EBIT before special items forecast for the Performance Materials division due to higher volumes and margins will not be able to compensate for this. Sales in the Industrial Solutions segment will likely increase slightly in 2020, mainly from higher volumes in both divisions. The sale of the ultrafiltration membrane business to DuPont Safety & Construction (DuPont) on December 31, 2019, as well as the transfer of BASF’s paper and water chemicals business to the Solenis group on January 31, 2019, will have an offsetting effect. Despite the continued challenging market environment, we expect a considerable increase in EBIT before special items for the segment, primarily as a result of higher volumes.
In the Surface Technologies segment, we are forecasting slight sales growth despite the expected decline in production in the automotive industry. We anticipate higher prices, especially in precious metal trading and for mobile emissions catalysts in the Catalysts division. Overall, we aim to slightly increase EBIT before special items, primarily with improved margins in precious metal trading. By contrast, we anticipate a slight year-on-year decline in sales and EBIT before special items in the Coatings division.
For the Nutrition & Care segment, we expect considerably higher sales than in 2019, largely from volumes growth in both divisions. Our planning assumes a continued improvement in product availability, especially in the Nutrition & Health division. Lower prices in both divisions will presumably have an offsetting effect. We expect to see a slight year-on-year improvement in EBIT before special items, mainly as a result of growth in sales volumes and despite positive one-off effects in 2019.
Despite the continuing challenging market environment, we anticipate considerable sales growth in the Agricultural Solutions segment. We aim to considerably increase our sales volumes, which should more than offset negative currency effects. Overall, we expect a slight increase in EBIT before special items. We will maintain our program to boost efficiency. We will also continue to invest at a high level in research and development and digitalization in 2020.
Sales in Other are expected to match the 2019 level in 2020. For EBIT before special items, we are forecasting a figure considerably above the previous year due to solid contributions from our equity-accounted shareholdings. Lower corporate research costs should also contribute here.
|Million €||Sales||EBIT before special items||ROCE|
|2019||Forecast 2020||2019||Forecast 2020||2019||Forecast 2020|
|Chemicals||9,532||slight increase||791||considerable decline||6.8%||slight increase|
|Materials||11,466||considerable increase||1,003||considerable decline||10.7%||considerable decline|
|Industrial Solutions||8,389||slight increase||820||considerable increase||12.5%||considerable decline|
|Surface Technologiesb||13,142||slight increase||722||slight increase||5.7%||at prior-year level|
|Nutrition & Care||6,075||considerable increase||793||slight increase||10.0%||considerable increase|
|Agricultural Solutions||7,814||considerable increase||1,095||slight increase||5.3%||slight increase|
|Other||2,898||at prior-year level||(688)||considerable increase||–||–|
|BASF Group||59,316||€60 billion–€63 billion||4,536||€4.2 billion–€4.8 billion||7.7%||6.7%–7.7%|
a For sales, “slight” represents a change of 1–5%, while “considerable” applies to changes of 6% and higher. “At prior-year level” indicates no change (+/–0%). For earnings, “slight” means a change of 1–10%, while “considerable” is used for changes of 11% and higher. “At prior-year level” indicates no change (+/–0%). At a cost of capital percentage of 9% for 2020, we define a change in ROCE of 0.1 to 1.0 percentage points as “slight,” a change of more than 1.0 percentage points as “considerable” and no change (+/–0 percentage points) as “at prior-year level.”
b The 2019 segment data for Surface Technologies excludes the construction chemicals activities presented as discontinued operations.