BASF Capital Market Story, May 2016 1
We add value as one company
Martin LiedemitDeputy Head of
Investor Relations
Nirath PerakathInvestor Relations
Manager Asia Pacific
Deutsche Bank
Access Asia
Conference 2016
May 25, 2016
BASF Capital Market Story, May 2016 2
150 years
Cautionary note regarding
forward-looking statements
This presentation may contain forward-looking statements that are subject to risks and
uncertainties, including those pertaining to the anticipated benefits to be realized from the
proposals described herein. Forward-looking statements may include, in particular, statements
about future events, future financial performance, plans, strategies, expectations, prospects,
competitive environment, regulation and supply and demand. BASF has based these forward-
looking statements on its views and assumptions with respect to future events and financial
performance. Actual financial performance could differ materially from that projected in the
forward-looking statements due to the inherent uncertainty of estimates, forecasts and
projections, and financial performance may be better or worse than anticipated. Given these
uncertainties, readers should not put undue reliance on any forward-looking statements. The
information contained in this presentation is subject to change without notice and BASF does
not undertake any duty to update the forward-looking statements, and the estimates and
assumptions associated with them, except to the extent required by applicable laws and
regulations.
BASF Capital Market Story, May 2016 3
150 years
Chemistry as an enabler
BASF has superior growth
opportunities:
– sustainable innovations
– investments
– emerging markets
The #1 chemical company
€70.4 billion sales, €6.7
billion EBIT bSI in 2015
#1-3 in ~70% of businesses,
present in almost all
countries
6 integrated Verbund sites,
production in 60 countries
A track record of strong
sales and earnings growth
>3.5% dividend yield in
every single year from
2006-2015
~€66 billion market
capitalization on April 29,
2016
Perspective
Ludwigshafen,
Germany
Antwerp,
Belgium
Nanjing,
China
Kuantan,
MalaysiaGeismar,
Louisiana
Freeport,
Texas
Verbund site
Positioning
We create chemistry
for a sustainable future
Performance
20
30
40
50
60
70
80
90
2008 2009 2010 2011 2012 20142013 2015
BASF Capital Market Story, May 2016 4
150 years
Percentage of sales 2015*
* Not depicted here: ~4% of Group sales reported as ‘Other‘ ** Natural Gas Trading has been divested on Sep. 30, 2015.
BASF today – a well-balanced portfolioTotal sales 2015: €70.4 billion
BASF Capital Market Story, May 2016 5
150 years
Global reduction in carbon
emissions of 6 million metric
tons p.a. and reduction of
waste
Example Ludwigshafen site:
avoidance of 7 million metric
tons of freight p.a.
= 280,000 fewer truckloads
Shared use of on-site facilities:
fire department, security, waste
water treatment and analytics
Verbund: Unique competitive advantage
* Savings include only tangible synergies. Additional (intangible) benefits and retained profits are not included.
Verbund generates >€1 billion p.a. global cost savings* & supports sustainability
BASF Capital Market Story, May 2016 6
150 years
0
1
2
3
4
5
2006 2007 2008 2009** 2010 2011 2012 2013 2014 2015
Strong free cash flow development 2015
* Cash provided by operating activities less capex
** 2009 adjusted for re-classification of settlement payments for currency derivatives
Free cash flow*
(in billion €)
3.53.2
2.5
3.2
3.93.7
2.6
3.2
1.7
3.6
BASF Capital Market Story, May 2016 7
150 years
Priorities 2016
Focus on capex discipline:
─ Reduce capital expenditures to €4.2 billion in 2016
Cost control and operational excellence:
─ DrivE targeting ~€1 billion annual earnings contribution
from end of 2018 on
Portfolio optimization ongoing:
─ E.g. agreement to sell industrial coatings business to AkzoNobel
Strong commitment to innovation:
─ Maintain R&D spending at ~€1.95 billion in 2016
BASF Capital Market Story, May 2016 8
Q1 2016 reporting
Business development
Path forward: Our priorities
BASF Capital Market Story, May 2016 9
150 years
Sales development Volumes Prices Portfolio Currencies
Q1 2016 vs. Q1 2015 0% (6%) (22%) (1%)
Q1 2016: BASF with slightly lower earnings
compared to strong prior-year quarter
Financial figures Q1 2016 Q1 2015 Change
Sales €14.2 billion €20.1 billion (29%)
EBITDA €2.8 billion €2.9 billion (3%)
EBIT before special items €1.9 billion €2.1 billion (8%)
EBIT €1.9 billion €2.0 billion (6%)
Net income €1.4 billion €1.2 billion +18%
Reported EPS €1.51 €1.28 +18%
Adjusted EPS €1.64 €1.43 +15%
Operating cash flow €1.0 billion €2.4 billion (56%)
BASF Capital Market Story, May 2016 10
150 years
Milestones in Q1 2016
Start-up of butanediol plant at the integrated
PolyTHF complex in Korla, China
JV with Avantium intended for production of
furandicarboxylic acid (FDCA) in Belgium
Update of peak sales potential for product
launches in Agricultural Solutions
Joint operation of polyoxymethylene (POM)
with Kolon Plastics planned in Korea
BASF Capital Market Story, May 2016 11
150 years
Outlook 2016
Sales will be considerably below prior year, due to the divestiture of the natural gas trading
and storage activities and the lower oil and gas prices. Excluding the effects of acquisitions
and divestitures, we expect higher volumes in all segments.
We expect EBIT before special items to be slightly below the previous year driven by
drastically lower earnings of Oil & Gas. We plan higher earnings in our chemicals business
and in the Agricultural Solutions segment.
EBIT after cost of capital is expected to be significantly below prior year. However, we still
expect to earn a premium on our cost of capital.
Assumptions 2016
GDP growth: +2.3%
Growth in industrial production: +2.0%
Growth in chemical production (excl. pharma): +3.4%
Exchange rate: $1.10 per euro
Oil price (Brent): $40 per barrel
Outlook 2016 confirmed
BASF Capital Market Story, May 2016 12
Q1 2016 reporting
Business development
Path forward: Our priorities
BASF Capital Market Story, May 2016 13
150 years
Components of growth
* 2010, 2011 indicative, adjusted for IFRS 10 & 11
59.6
70.4
+10.5-1.4 +2.6 -0.9
20
40
60
80
2010 2015
Volumes
PricesFX M&A
Sales* analysis 2010 – 2015
(in billion €)
(in billion €) Net sales 2010 Volumes Prices FX M&ASales CAGR
2010 - 2015
BASF Group
w/o Oil & Gas51.4
+2.8 (+1.1% CAGR)
-0.9 +2.6 +1.6 +2.3%
Oil & Gas 8.2+7.7
(+14.2% CAGR)-0.5 +0.0 -2.5 +9.6%
3.4%
CAGR
BASF Capital Market Story, May 2016 14
150 years
Functional crop care
Personal care & food
Omega-3 fatty acids
Enzymes
Battery materials
Specialty plastics
Selected assets in Oil & Gas
BASF
core business
Strong partnerships
Gazprom
Monsanto
Petronas
Shell
Sinopec
Statoil
Total
Yara
Selected transactions
2010 − until today
Acquisitions
~ €4.5 billion salesin emerging and innovation-driven
businesses
Divestitures
Styrenics
Fertilizers
Selected assets in Oil & Gas
Natural gas trading & storage
Custom synthesis business
Industrial coatings
Textile chemicals
PP/PE catalysts
~ €20 billion sales*
in businesses with limited fit and differentiation
potential
Portfolio development towards more
market-driven and innovative businesses
* Includes sales of non-consolidated businesses (Styrenics, VNG participation)
BASF Capital Market Story, May 2016 15
150 years
Steady earnings growth
* 2010, 2011 indicative, adjusted for IFRS 10 & 11; 2001 – 2009 as reported, without non-compensable foreign income taxes on oil production
EBIT and EBITDA*
(in billion €, 2001 - 2015)
3.7
4.7 4.6
7.0 7.2
8.48.9
7.7
6.5
9.9
11.2
10.010.4
11.010.6
0
2
4
6
8
10
12
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
EBITEBITDA
0.7
2.2 2.2
4.5 4.8
5.56.0
4.6
2.8
6.7
8.0
6.7 7.27.6
6.2
CAGREBITDA
7.9 %CAGREBIT
16.6 %
BASF Capital Market Story, May 2016 16
150 years
50
100
150
200
250
300
350
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Strong track record in operational
excellence
EBITDA
Sales
* Excl. companies with major IFRS 10/11 restatements, i.e. BASF YPC Nanjing, Libya onshore, other Oil & Gas and Catalysts companies
BASF Group* 2001–2015
(Index; CAGR 2001–2015)
Fixed Costs
CAGREBITDA
9%
CAGRSales
6%
CAGRFixed Costs
3%
BASF Capital Market Story, May 2016 17
150 years
0.0
0.5
1.0
1.5
2.0
2.5
3.0
2006 2009 2012 2015
2.90
We want to grow or at least
maintain our dividend at the
previous year’s level
Dividend of €2.90 per share,
an increase of 3.6%
Dividend yield of 4.1% in 2015
Dividend yield above 3.5%
in any given year since 2006
4.6%
Attractive shareholder return
Key facts 2015
Dividend per share (€)
0.50
1.00
1.50
2.00
* Dividend yield based on share price at year-end
4.1% 3.8% 7.0% 3.9% 3.7%Yield* 3.7%
2.50
3.5%
3.00
4.0% 4.1%
1.50
1.95 1.95
1.70
2.20
2.50 2.60 2.70
Dividend policy
2.80
BASF Capital Market Story, May 2016 18
150 years
Average annual performance with dividends reinvested
0 3 6 9 12 15
Euro Stoxx 50
DAX 30
MSCI World Chemicals
+5.3%
Last 5 yearsMay 2011 – April 2016
+4.3%
+3.3%
+6.0%
+5.9%
Last 10 yearsMay 2006 – April 2016
BASF
+6.6%
+0.7%
+12.0%
Delivering consistent, long-term value
BASF Capital Market Story, May 2016 19
Q1 2016 reporting
Business development
Path forward: Our priorities
BASF Capital Market Story, May 2016 20
150 years
.
Moderate GDP growth expected for 2016
– recovery in the medium term
1.8 1.7 1.8
2015 2016 2016-2018
6.2 5.7 5.8
2015 2016 2016-2018
-2.1 -1.7
0.6
2015 2016 2016-2018
2.4 2.1 2.4
2015 2016 2016-2018
European Union
United States
South America
Emerging Asia
Source: BASF
GDP growth in key regions
(in % per year)
2.4 2.3 2.7
2015 2016 2016-2018
World
BASF Capital Market Story, May 2016 21
150 years
Chemicals remains a growth industry
…more food needed
by 2050…more primary energy
consumption
by 2050
…of the world
population will live in
cities by 2050
Agriculture Health &
nutrition
Energy &
resources
Transportation Construction
& housing
Consumer
goods
Chemistry as enabler for current and future needs
…people
by 2050
Electrical &
Electronics
70% 50% ~10
bn30%
BASF Capital Market Story, May 2016 22
150 years
Emerging markets driving chemical
production growth above global GDP
0
1,000
2,000
3,000
4,000
5,000
2010 2015 2020 2025
+0%
+4%
+0%
+3%
+1%
+5%
+2%
+4%
+1%
+2%
+2%
Global GDP
CAGR:
2.6%
Global GDP
CAGR:
3.0%
Real chemical production excl. pharma
(in billion US$**)
CAGR*
3.7%
CAGR*
3.7%
CAGR*
3.8%
+5%
+3%
+3%
+1%
+2%
+2%
Global GDP
CAGR:
3.1%
+6%
Asia Pacific
South America
Middle East, Africa
Western Europe
Eastern Europe
North America
* Real chemical production excluding pharmaceuticals; ** Measured in value of 2010
BASF Capital Market Story, May 2016 23
150 years
Grow sales and earnings faster than global chemical production,
driven by
– Continued focus on innovations
– Capital expenditures
– Acquisitions
– Operational excellence and Verbund advantages
Focus on cash generation / conversion
Continue with our progressive dividend policy
Focus on pruning our portfolio
Maintain industry-leading position in sustainability
The path forward:
Our priorities
BASF Capital Market Story, May 2016 24
150 years
Managing volatility: BASF almost perfectly
hedged on hydrocarbon price changes
BASF production and consumption of oil and gas
(in million boe, 2015)
BASF hydrocarbon consumption almost equals hydrocarbon production
Production of oil, liquids and gas Consumption of oil derivatives and gas
153
>100
Natural
gas
Oil and
liquids
Natural gas for energy
and as raw material
Naphtha and
other oil-based
raw materials
40
113
BASF Capital Market Story, May 2016 25
150 years
0
100
200
300
400
500
2001 2002 2003 2004 2005 2006* 2007* 2008 2009 2010 2011 2012restated
2013 2014 2015
EBITDA margin Chemicals / oil price
Index 2001 = 100
Chemicals with stable profitability,
little correlation to oil price
EBITDA margin Chemicals
(as % of sales)
Oil price
* Without Catalysts (now part of Functional Materials & Solutions segment)
BASF Capital Market Story, May 2016 26
150 years
Strategic lever:
Continuous portfolio development
Specialties and
solutions
Differentiated
commodities
target(in % of sales*)
~ 50% ~ 50%
Keep a balanced portfolio
Divestment of
businesses
e.g. due to
loss of
differentiation
Divestment of
businesses
e.g. due to
lower market
attractiveness
Commoditization leads to
restructuring
Growth
fields
Innovation
pipeline
Acquisitions
* Excluding Oil & Gas sales
Attractive markets
Differentiation by process
technologies and integration
Attractive markets
Differentiation by customer
proximity and innovations
BASF Capital Market Story, May 2016 27
150 years
Provide a minimum return on
investment of 8% p.a. after tax
Are EPS accretive by year three
at the latest
Financial acquisition criteria
Generate profitable growth
above the industry average
Are innovation-driven
Offer a special value proposition
to customers
Reduce earnings cyclicality
Strategic acquisition criteria
We want to acquire businesses which …
Strategic lever:
Acquisitions
BASF Capital Market Story, May 2016 28
150 years
Strategic lever:
Capital expenditures
Differentiated commodities
With proprietary technology and/or Verbund advantages
Focus on:
– emerging markets
– backward integration in the U.S.
– upgrading our asset base in Europe
Specialties and solutions
Incremental investments for new products
Regional expansion of businesses
Oil & Gas
Focus investment budget by active portfolio optimization to secure free cash flow
Keep reserve-to-production ratio of approx. 10 years
BASF Capital Market Story, May 2016 29
150 years
Investments for organic growth
Performance
Products
16%
Oil & Gas
24%
€19.5
billion
Functional
Materials &
Solutions
12%
Capex budget 2016-2020
Other
14%
Chemicals
30%
Capex budget 2016-2020
Asia Pacific
18%
€19.5
billion
South
America*
9%
North America
26%
Europe
46%
Agricultural
Solutions
4%
Other
1%
by segment by region
* Including Africa and Middle East
BASF Capital Market Story, May 2016 30
150 years
Strategic lever:
Innovations
Allow for creativity
Balance incremental und disruptive innovations
Manage innovation pipeline efficiently on all levels
Build on our global R&D Verbund
Leverage external collaborations even more
Align R&D activities with business models:
– Differentiated commodities
• Focus on improving processes and addressing raw material change
• Launch selected product innovations
– Specialties and solutions
• Develop new, tailored offerings in close collaboration with customers
• Pursue solution-oriented approach
Keep annual R&D spending at ~3% of sales*
* Without Oil & Gas
BASF Capital Market Story, May 2016 31
150 years
€1.95 billion R&D expenditures
in 2015; to be maintained in
2016
~10,000 employees in R&D
~3,000 projects
Ranked No.1 in the
Patent Asset Index™
~1,000 new patents in 2015
Research Verbund:
Cooperations with more than
600 excellent partners from
universities, start-ups
and industry
Strong commitment to innovationInnovations for a sustainable future
Key facts
1.6
1.71.8 1.9 1.95
0.0
0.5
1.0
1.5
2.0
2011 2012 2013 2014 2015
R&D expenditures
(billion €)
Chemicals
11%
Performance Products
20%
Functional Mat. & Sol.
20%
Agricultural Solutions
26%
Oil & Gas
2%
Corporate Research
21%
2.0
1.5
1.0
0.5
0
BASF Capital Market Story, May 2016 32
150 years
0
50
100
150
BASF Competitors
FWC™
Combines functionality of a 3-way
conversion catalyst with
integrated filter on a ceramic
substrate
Reduces gaseous emissions
Precious metal-based catalytic
coating removes exhaust gases
from engine emissions**
Removes particulates
Filters & combusts particulates
Complies with emissions limits
Helps automakers meet new
Euro 6c regulatory standards
FWC™ introduced in 2013
Sustains BASF’s leading
technology position
Leading position: Global mobile emissions catalysts patents*
* 2009 – 2013 ** Hydrocarbons, carbon monoxide, nitrogen oxides
*** https://www.basf.com/en/company/news-and-media/science-around-us/catalytic-converter.html
FWC™ reduces emission of gaseous pollutants and particulates
HC
CO
NOx
N2
H2O
CO2
Particulates
Innovation: Four-Way Conversion
Catalyst (FWC™)
BASF Capital Market Story, May 2016 33
150 years
Innovation: Green Sense®
Concrete for sustainable construction
En
vir
on
me
nta
l Im
pa
ct
Hig
h
Reference
Concrete
High Low
Lo
w
Total Cost of Ownership
BASF’s Green Sense® Concrete
system consists of:
1) Innovative admixture products
2) Concrete mix services
3) Eco-efficiency analysis
Replaces up to 70% of cement
with recycled materials
Superior eco-efficiency
Applied in the construction of
landmark projects, e.g. One
World Trade Center, NYC
BASF Capital Market Story, May 2016 34
150 years
Innovation: Trilon® MChelating agent for more sustainable detergents and cleaners
Trilon® M – alternative to phosphate for automatic
dish washing
High sustainability performance: bio-degradable and
eco-friendly
Fast growing global market demand driven by
regulatory changes and consumer demand
2010: Capacity expansion to 120,000 tons
2015: Start-up of a new Trilon® M world-scale plant in
Theodore, Alabama
Compared with alternative chelating agents Trilon® M
Is readily bio-degradable
Meets eco-label requirements
Has better eco-toxicology profile
Shows high performance
BASF Capital Market Story, May 2016 35
150 years
Innovation: SAVIVA™ Highly efficient Superabsorbent Polymers (SAP)
SAVIVA™ – based on a pioneering SAP technology
platform
SAVIVA™ the next generation of SAP
Round-shaped particles with micro-pores initiates
innovative liquid distribution mechanism
Compared to other SAPs SAVIVA™ leads to:
Efficiency gains:
– SAP reduction
– Fluff reduction
– Reduction of storage, packaging and transportation
costs
Improved sustainability:
– Better carbon footprint due to SAP and weight
reduction
– Enabler for future diaper designs offering a new
level of comfort and dryness
SAVIVA™ round shaped particle
BASF Capital Market Story, May 2016 36
150 years
Lower production cost than
industry average
Efficiency gains:
– run-time extension
– higher throughput
– lower energy consumption
Proprietary technology,
new process protected by
280 active patent families
4 out of 6 production sites
already equipped: Ludwigs-
hafen, Antwerp, Nanjing and
Camaҫari (Brazil)
Innovation: New acrylic acid technologyBASF with best-in-class acrylic acid process
80
85
90
95
100
BASFnew process
BASFclassic process
Industry average
Acrylic acid production technology benchmark
(Industry average costs = 100; normalized)Key facts
Source: BASF estimate
BASF Capital Market Story, May 2016 37
150 years
2.2% 0.2%
Novel methodology to screen
and steer our portfolio*
26.6% Accelerators:
– outgrow their markets
by 2-10%
– deliver margins >10%
above the average
– represent >60% of BASF’s
R&D pipeline
71% Performers
<1% Challenged products
* More than 60,000 product applications analyzed representing €64.9 billion in sales or 95.4% of BASF’s portfolio.
Increase the share of Accelerators from 23% in 2014 to 28% by 2020
Strategic lever: Sustainability
Sustainable Solution Steering
26.6%
71.0%
Substantial sustainability
contribution in the value chain
Meets basic sustainability
standards in the market
Specific sustainability issue
which is actively addressed
Significant sustainability concern,
action plan in development
Sustainable
Solution
Steering
BASF Capital Market Story, May 2016 38
150 years
0
1,000
2,000
3,000
4,000
2015 2018
Annual earnings contribution
(in million €) Targeted annual earnings
contribution of €1 billion from
end of 2018 on
Optimization of processes and
structures in all regions, e.g.
– manufacturing
– incremental capacities
– productivity increase
Project timeline: 2016–2018
DrivE program
Strategic lever: Operational excellence
DrivE with ~€1 bn earnings contribution
NEXT 2008-2011 DrivE 2016-2018
STEP 2012-2015
BASF Capital Market Story, May 2016 39
150 years
Profitability of BASF will grow faster than
global chemical production
Sales growth
Slightly faster than the global chemical production
EBITDA growth
Well above global chemical production
Remain a strong cash provider
Continuously generate high levels of free cash flow
Financial targets for next years
Deliver attractive returns
Earn a significant premium on cost of capital
Progressive dividend policy
We want to grow or at least maintain our dividend
BASF Capital Market Story, May 2016 40
Appendix I – Q1 2016 reporting
BASF Capital Market Story, May 2016 41
150 years
Sales development Volumes Prices Portfolio Currencies
Q1 2016 vs. Q1 2015 (3%) (16%) 0% 0%
Intermediates
646
(12%)
Monomers
1,307
(18%)
Petrochemicals
1,196
(22%)
€3,149
(19%)
EBIT before special items
million €
726
548
633
249
465
0
200
400
600
800
Q1 Q2 Q3 Q4 Q1
20162015
Sales Q1 2016 vs. Q1 2015
million €
ChemicalsLower margins and higher fixed costs result in considerably
decreased earnings
BASF Capital Market Story, May 2016 42
150 years
Sales development Volumes Prices Portfolio Currencies
Q1 2016 vs. Q1 2015 1% (4%) (2%) (1%)
Performance
Chemicals
955
(10%)
Performance ProductsIncrease in earnings by 6%, supported by successful
restructuring
Care
Chemicals
1,204
(7%)
€3,783
(6%)Nutrition
& Health
488
(5%)
Dispersions
& Pigments
1,136
(2%)
515
304 319
228
547
0
200
400
600
Q1 Q2 Q3 Q4 Q1
Sales Q1 2016 vs. Q1 2015
million €
EBIT before special items
million €
20162015
BASF Capital Market Story, May 2016 43
150 years
Catalysts
1,467
(8%)
Coatings
738
(6%)
€4,408
(4%)
Performance
Materials
1,670
(2%)
431458
371 389456
0
200
400
600
Q1 Q2 Q3 Q4 Q1
Sales development Volumes Prices Portfolio Currencies
Q1 2016 vs. Q1 2015 5% (7%) 0% (2%)
EBIT before special items
million €
20162015
Construction
Chemicals
533
+6%
Functional Materials & SolutionsGood demand from the automotive and construction industries
Sales Q1 2016 vs. Q1 2015
million €
BASF Capital Market Story, May 2016 44
150 years
1,8981,780
0
1,000
2,000
Q1 Q1
Sales development Volumes Prices Portfolio Currencies
Q1 2016 vs. Q1 2015 (5%) 2% 0% (3%)
2016201520162015
(6%)
574 591
0
200
400
600
Q1 Q1
+3%
Agricultural SolutionsSlight earnings increase in a challenging market environment
Sales
million €
EBIT before special items
million €
BASF Capital Market Story, May 2016 45
150 years
Sales development Volumes Prices/Currencies Portfolio
Q1 2016 vs. Q1 2015 2% (4%) (86%)
Oil & GasSignificantly lower sales and earnings
4,249
744
6110
1,000
2,000
3,000
4,000
5,000
Q1 Q1
20162015
* Including transportation business
161
359
47
276
66
-100
100
300
500
EBIT bSI Net income EBIT bSI Net income
Natural Gas TradingExploration & Production
437
276
EBIT before special items, net income
million €
Sales
million €
*
20162015
Q1 Q1
(88%)
Natural Gas TradingExploration & Production
4,993
*
* Including transportation business
BASF Capital Market Story, May 2016 46
150 years
Review of ‘Other’
million € Q1 2016 Q1 2015
Sales 477 688
EBIT before special items (219) (613)
Thereof Corporate research costs (99) (101)
Costs of corporate headquarters (55) (55)
Foreign currency results, hedging and
other measurement effects 68 (382)
Other businesses 18 35
Special items (26) (82)
EBIT (245) (695)
BASF Capital Market Story, May 2016 47
150 years
Cash flow Q1 2016
million € Q1 2016 Q1 2015
Cash provided by operating activities 1,046 2,390
Thereof changes in net working capital (1,248) 309
miscellaneous items (39) 5
Cash used in investing activities (1,258) (1,502)
Thereof payments related to tangible / intangible assets (1,001) (1,278)
acquisitions / divestitures 0 26
Cash used in / provided by financing activities 1,997 (400)
Thereof changes in financial liabilities 1,996 (299)
dividends (4) (101)
BASF Capital Market Story, May 2016 48
150 years
Dec 312015
Mar 312016
3.13.8
Balance sheet remains strong
Balance sheet March 31, 2016 vs. December 31, 2015
billion €
Liquid funds
Accountsreceivable
Long-termassets
9.5
Otherliabilities
Financialdebt
Stockholders’equity
Inventories
Other assets
9.7
2.2
10.7
9.6
4.0
27.8
20.9
1.3
28.4
22.4
2.0
15.114.4
46.3
70.873.7
45.6
Dec 312015
Mar 312016
70.8 73.7
24.1
15.2
31.5
26.0
16.8
30.9
Total assets increased by
€2.9 billion, mainly due to
higher cash position and
seasonally-driven increase in
accounts receivable
Long-term assets slightly lower
caused by currency effects
Provisions for pension
obligations increased by
€2.0 billion as a result of
lower interest rates
Net debt slightly declined to
€12.8 billion
Equity ratio: 42%
BASF Capital Market Story, May 2016 49
Appendix II – BASF in Asia Pacific
BASF Capital Market Story, May 2016 50
150 years
BASF in Asia Pacific
Customers from 38 markets
~100 production sites*
>120 sales offices*
17,562 employees**
~€12.3 billion*** sales in 2015
~€409 million EBIT before special items in 2015
* Some sites are not shown due to scale. Site and office numbers
refer to companies of significant size where BASF holds a stake
greater than 50%.
** Employee number as of December 31, 2015
*** Sales by location of customer; as of December 31, 2015
BASF Capital Market Story, May 2016 51
150 years
BASF’s performance in Asia Pacific
0
0.2
0.4
0.6
0.8
1
2012 2013 2014 2015
0
5
10
15
2012 2013 2014 2015
12.5 12.4 12.3 12.3
Net sales 3rd party*
(in billion €)
Stable volumes despite challenging environment.
Slight volume increase in China
Increased share of products produced in Asia
R&D platform set up
Cost discipline
Negative top line impact due to portfolio management
Overcapacities and low oil price impact margins and pricing
* By location of customer
EBIT bsi
(in billion €)
0.90.8
0.6
0.4
BASF Capital Market Story, May 2016 52
150 years
The path forward: our priorities
Set up the right asset base for future growth
Strengthen local R&D close to growing customers
Enhance customer collaboration
Optimize our portfolio continuously
Focus on operational excellence and cost discipline
BASF Capital Market Story, May 2016 53
150 years
Selected major capex projects
Right Asset Base
Invest selectively for profitable growth
Significant capex in Asia to
build a base for future growth
Future focus on investments
where BASF
− is technologically leading
− has a competitive
advantage
− expects strong profitable
market growth
Care chemicals
Polymer dispersions
Polyurethane specialties
Specialty plastics
Cracker expansion
Amines
Surfactants
Acrylic acid & SAP
Resins
Specialty plastics
Crop protection products
Innovation Campus (Shanghai)
Start-ups
2011 - 2014
Start-ups
planned for
2015 - 2017
China
Asia Pacific*
MDI
Polyamides
Butanediol / PolyTHF®
Neopentylglycol
Specialty amines
Ethylene oxide
Isononanol
Coating resins
Automotive catalysts
Process catalysts
Automotive catalysts
Polymer dispersions
Specialty plastics
Aroma chemicals
2-Ethylhexanoic acid
Polyisobutene
Innovation Campus II (Shanghai)
Innovation Campus (Mumbai)
* Without China
BASF Capital Market Story, May 2016 54
150 years
Overcapacities in Asia will be absorbed
over time
BASF benefits from attractive cost positions
Source: BASF estimate
0
2,500
5,000
Acrylic acid Butanediol Caprolactam MDI TDI
Cas
h c
os
ts
BA
SF
cla
ssic
pro
cess
BA
SF
ne
w p
roc
ess
Production capacity
Acrylic acid
cash cost curve, China
average cash costs
2015 in USD/kg
Overcapacities in Asia will persist for some years
(Industry capacities in kt, operating rate in percent)
~60%
~70%
~75% ~75%
~70%
BA
SF
Pla
nt
3
BA
SF
Pla
nt
2
Cas
h c
os
ts
Production capacity
BA
SF
Pla
nt
1
1,4-Butanediol (BDO)
cash cost curve, Asia
average cash costs
2015 in USD/kg
Capacity 2015 Est. operating rate
BASF Capital Market Story, May 2016 55
150 years
R&D close to growing customers
Our facilities across Asia Pacific
R&D Center Korea
Focus: electronics
R&D Center Singapore
Focus: water, membrane,
oilfield, electronics
R&D Center
Australia
Focus: mining
Innovation Campus
Asia Pacific, Shanghai
Focus: polymers & materials,
process engineering, formulations
Innovation Campus
Asia Pacific, India
Focus: life science, agro
R&D Center Japan
Focus: electronics,
battery materials
2007 20142012 2013 20172015
Advanced Materials &
Systems Research
moves HQ to Shanghai
BASF Capital Market Story, May 2016 56
150 years
Polyurethane composite
solutions Elastolit® developed
in Shanghai for utility poles
Elastolit® enables utility poles
to resist winds at least 2.5
times stronger than traditional
concrete utility poles
Cost effective and easy to
construct
Poles erected in pilot project
in southern China. In July
2014 PU-based poles were
unaffected by typhoon
Rammasun
Utility poles that can withstand typhoons
Example: Innovation
Elastolit®
Polyurethanes
composite solution
to replace
concrete
BASF Capital Market Story, May 2016 57
150 years
Energy efficient PVC window profiles
BASF developed new
co-extrudable Ultradur®
reinforcement for the
production of PVC window
profiles
Profile jointly developed with
Dalian Shide Group
It is light weight replacement
of steel with melting point
closer to PVC
Enables one-step optimized
extrusion process of window
profiles
Reduces energy consumption
for heating and cooling by
15-20 percent
New co-extrudable Ultradur®
solution for lightweight reinforcement of window profile
Customer collaboration
PBT* co-extrusion
* PBT: Polybutylene terephthalate
Metal insert
Increases
energy
efficiency by
15-20%
BASF Capital Market Story, May 2016 58
150 years
Focus on cost discipline
Structural
Excellence
Investment
Excellence
Functional
Excellence
Operational
excellence
Cost
Discipline
58BASF Asia Pacific Capital Market Story 2016
BASF Capital Market Story, May 2016 59
150 years