BASF presented the economic results of the financial year 2022 in Spain. The Group's sales figure in the country reaches 1.562 million euros, which represents a growth of 2021% compared to 16. This increase is the result of price growth in virtually all segments (+19%) and falling volumes (-2%).
The panorama that these figures leave reveals two trends with different evolution throughout 2022. “On the one hand, the volumes, which had a different behavior throughout the year: a first semester with increases; and a second, in which especially the last quarter, in which demand fell and product from Asia increased, especially in the Chemicals and Materials businesses. This trend could continue in 2023," he explains. Carles navarro, CEO of BASF Española and head of the Group's activities in the Iberian Peninsula. “Secondly, the price increase is general in all businesses. More accentuated in the first half of the year, due to energy and raw material costs, and a slight downward trend in the second half. This effect, which in turn impacts our customers, has caused the deterioration in volumes”.
Thus, the growth in sales has been mainly motivated by the increase in prices in practically all segments, linked to the increase in the prices of raw materials and energy. All the businesses, with the exception of Coatings and Nutrition, observe a downward trend in volumes; however, those that presented the greatest deterioration were those of Monomers, Personal Care and Catalysts; in the case of the first two, a cause-effect relationship is observed for the increase in product prices. The structural effects remain 1%, due to the sale of the Pigments business in July 2021 and the Kaolin business (kaolin minerals) in September 2022.
“BASF's results in Spain are in line with the company's global results. 2022 has been a complex year, with a complicated market environment, dominated by the consequences of the war in Ukraine and by the increase in the prices of raw materials and energy”, adds Carles Navarro. Regarding the 2023 financial year, the degree of uncertainty is expected to continue due to the Russia-Ukraine conflict, the high costs of raw materials and energy in Europe, the increase in prices and interest rates, inflation and the evolution of the coronavirus pandemic that will last through 2023. “They will affect global demand. 2023 has started with weak demand, which at a global level we expect to improve during the second half, especially in China”. On February 24, the Group communicated during the global presentation of financial results expectations of generating sales of between 84.000 and 87.000 million euros and a decrease in EBIT before extraordinary items of between 4.800 and 5.400 million euros for the current year. .
BASF expects moderate global economic growth of 1,6% (3% in 2022) and 2% for global chemical production (2022: 2,2%). The Group will invest 2023 million euros in Spain in 43, earmarked for the improvement of facilities and processes. In 2022, investments worth 44 million euros were reported, which eventually reached 50 million. This figure confirmed a stable line of investments, which in 2021 had also been 50 million euros.
The investments in recent years have meant a strategic leap for the company's production centers in Spain, as has happened with Guadalajara. The Marchamalo car paint factory will inaugurate the new Application Center for the automotive industry in the second half of 2023. The investment, of 16 million euros, means the largest injection of capital in recent decades in Guadalajara. Among others, the entire laboratory building has been renovated, a new warehouse for chemical products has been built and the Lean Lab concept has been deployed. Navarro: "After spending difficult years in the past, and despite the fact that the automotive market It is going through a complex moment right now, Guadalajara is a bet for the future for the BASF Group and for its paint division for bodywork”. These investment projects are added to the transfer of productions that until now were carried out in other European centers to the Guadalajara factory, confirming its strategic role within the world map of the Coatings division.
New engineering hub in Spain
“It is correct to affirm that we have resisted in a difficult environment and, in addition, we have maintained investment in the country. This is the main indicator of commitment to a territory, but not the only one. In recent years, Spain has strengthened its strategic role within BASF's global map", points out Navarro, who has announced the installation in the country of an international engineering hub, which "will develop projects for the whole of Europe and reinforce our international role within of the group. The increase in activities will take place in two locations within the country: one, in the same production center of La Canonja (Tarragona), where the current engineering unit already resides; and another, in Madrid, to take advantage of synergies with the main partners in engineering projects in the country. In both locations this will imply the creation of new jobs”.
This will be the second international hub that the company has opened in Spain in the last four years, together with the digitization hub, BASF Digital Solutions, which began its journey in Madrid in 2019, facilitating digital solutions within the company worldwide and in which about 500 people already work.
In this field, that of digital transformation, Spain has also ratified its strategic position during 2022. The Tarragona production center has continued to make progress in the installation of the private 5G network, becoming one of the first companies in Spain and the first chemist to receive its own private 5G spectrum in order to operate.
The capabilities of this state-of-the-art network combined with Mobile Edge Computing mean that latencies are very low, allowing us to think about next-generation production management use cases. The innovative design of the infrastructure already allows the guidance of the trucks to the logistics points, maintain a direct connection with the field technicians, automate rounds by means of quadruped robots and, in the future and thanks to the speeds of transmission and processing of With the data, the plants will be able to make some decisions of their own to obtain the best performance in the production processes.
Lastly, two of the main pillars of BASF's sustainability strategy are decarbonization and the creation of products that accelerate the sustainable development of its customers and, therefore, of the final consumer in their purchasing decision.
