• Sales (up 25%) and EBIT before special items
  (up 40%) far above previous year’s levels
• Cognis integration progressing rapidly
• Outlook for 2011 confirmed

Ludwigshafen , Germany ? May 6, 2011 ? BASF has had a powerful start to 2011. Capacity utilization rates in the company’s plants were good; in particular, demand in the chemicals business (Chemicals, Plastics, Performance Products, Functional Solutions) increased compared with the same quarter of the previous year. Sales grew by 25% to ?9.4 billion. The Cognis businesses acquired in December 2010 made a significant contribution to this substantial sales growth. The earthquake off the coast of Japan and its aftermath as well as the tense political situation in North Africa have not yet had a significant impact on BASF’s business.

“Despite strong increases in raw materials costs, income from operations before special items rose by 40% to ?.7 billion,” said Dr. Jürgen Hambrecht, Chairman of BASF’s Board of Executive Directors at the Annual Meeting in the Congress Center Rosengarten in Mannheim, Germany. Hambrecht and Dr. John Feldmann are retiring from the BASF’s Board of Executive Directors at the end of the Annual Meeting. At that time, the new Board led by Dr. Kurt Bock will take office.

Compared with the first quarter of 2010, sales volumes rose in nearly all segments. As a result of the situation in Libya, oil production was suspended at the end of February 2011; this led to a reduction in oil production volumes in the Oil & Gas segment. In the Agricultural Solutions segment, prices declined slightly; all other segments reported price increases.

Income from operations (EBIT) increased by 39% to ?.6 billion compared with the first quarter of the previous year. EBITDA rose by ?38 million to ?.4 billion. The EBITDA margin rose to 17.4% (first quarter of 2010: 17.0%).

The financial result was ?30 million, an improvement of ?10 million compared with the same period of the previous year. This was due to the special item of ?87 million that resulted from the sale of the company’s stake in K+S Aktiengesellschaft. Overall, special items in income before taxes and minority interests amounted to ?05 million.

Income before taxes and minority interests rose by ?.6 billion in the first quarter of 2011 to ?.4 billion. At 24.7%, the tax rate was lower than in the first quarter of 2010. This decline was mainly attributable to the lower share of earnings from the highly-taxed Oil & Gas segment.

Net income increased by ?.4 billion to ?.4 billion. Earnings per share were ?.62 in the first quarter of 2011 compared with ?.12 in the same period of 2010. Adjusted for special items and amortization of intangible assets, earnings per share amounted to ?.94 (first quarter of 2010: ?.32).

At the end of the first quarter of 2011, BASF shares traded at ?1.03, an increase of 2.2% compared with the closing price at the end of 2010. The BASF stock thus performed slightly better than the German stock index DAX 30, which rose by 1.8% during the same period.

The Board of Executive Directors and the Supervisory Board have proposed to the Annual Meeting that a dividend of ?.20 per share be paid for the 2010 business year. Hambrecht stated: “We stand by our ambitious dividend policy and plan to pay out around ? billion to our shareholders. We continue to aim to increase our dividend each year, or at least maintain it at the previous year’s level.” Based on the year-end share price for 2010, BASF shares offer a high dividend yield of 3.7%.

Outlook full-year 2011

In the forecast, BASF assumes that it will not be able to resume its crude oil production in Libya in 2011. The company expects a higher annual average oil price. Therefore, the previous forecast of $90 per barrel has been raised to $100 per barrel.

Despite the reduction in oil production, the BASF Group expects significant sales growth in 2011. As a result of the suspension of oil production in Libya, the company now anticipates that the non-compensable oil production taxes will decline by around ?00 million (assumption 2011: ?80 million; 2010: ?83 million).

Hambrecht said: “Adjusted for the non-compensable oil production taxes, we continue to aim to significantly exceed the record 2010 level in income from operations before special items. We expect to earn a high premium on our cost of capital once again in 2011.”

Increase in sales and earnings in all segments

In the Chemicals segment, sales in all divisions increased substantially as a result of significantly higher sales prices in almost all business areas as well as greater volumes and positive currency effects. Earnings sharply exceeded the level of the previous first quarter due in large part to good margins, in particular in the acrylic acid value-adding chain, as well as high capacity utilization rates.

The Plastics segment experienced strong demand in all business areas; sales improved substantially compared with the first quarter of 2010 in particular as a result of higher sales volumes. Owing to the ongoing shortages of several products, higher raw materials costs could largely be passed on to the markets, especially in the Performance Polymers division. Thanks to high sales volumes, earnings increased sharply.

Sales in t he Performance Products segment were also far above the level of the same quarter of 2010. The acquired Cognis businesses contributed significantly to the improvement in sales. Sales growth was additionally boosted by increased volumes as well as higher prices resulting from the rise in raw materials costs. Earnings improved as a result of the inclusion of the Cognis businesses, synergy effects from the Ciba integration and the successful r