By Ludwig Burger
(Reuters) -German chemicals giant BASF on Thursday slashed the dividends it plans to pay out in 2025 and in the following three years as it grapples with weak demand in Europe and eyes splitting off several businesses.
The new annual dividend proposal of at least 2.25 euros ($2.51) compares with a dividend 3.40 euros per share, or 3 billion euros ($3.35 billion) in total, paid out this year and in the two years before.
To mitigate the decline, BASF is planning share buybacks, starting in 2027 at the latest and worth around 4 billion euros in total.
In aggregate, BASF said it is committed to keeping the overall distribution to shareholders at the level of the last years through a combination of dividends and share buybacks.
“In this way, BASF aims to distribute at least 12 billion euros to shareholders from 2025 to 2028.”
The company also said it was forecasting earnings before interest, taxes, depreciation and amortization (EBITDA) before special items of 10 billion to 12 billion euros in 2028, but that was contingent on “mid to upcycle conditions”.
Analysts on average expect about 11 billion euros in 2028 EBITDA, according to LSEG data.
BASF also said it was preparing a divestment process for its decorative paints business in Brazil.
The company confirmed a report by Reuters on Wednesday that it is planning a partial listing of its agricultural chemicals business and that it is considering new ownership options for its coatings unit because the stock market is underestimating their earnings prospects within the group.
($1 = 0.8965 euros)