BASF Group Outlook 2008

Our business has continued to develop successfully since the beginning of 2008. The level of orders remains strong. Taking into account the economic assumptions described above, we expect BASF’s business to develop positively in the next two years.

We aim to further extend our position as the world’s leading chemical company. Our goal is to continue to increase BASF’s value and earn an attractive premium on our cost of capital.

Forecast

Acquisitions made in recent years have extended our portfolio into high-growth and innovative areas, strengthened our profitability and further reduced our dependency on the cyclicality of the chemical industry. In 2008, assuming there are no changes made to our portfolio, we aim to increase sales and slightly improve income from operations before special items. We expect to grow faster than the chemical market each year and we are confident of earning at least our cost of capital in any given year.
Outlooks for each of our segments and operating divisions are provided in the section “Results of Operations by Segment“.

Dividends and share buybacks

We aim to further increase our dividend annually and match the previous year’s level even in years in which the business environment is difficult. Moreover, we also intend to continue to buy back shares.

Supplementary Report

The Board of Executive Directors decided on February 12, 2008, to cancel a total of 17,470,000 shares. Of this amount, 12,300,000 were own shares held by the company on December 31, 2007, and a further 5,170,000 were BASF SE shares repurchased in the period January 1 to 31.

Since the beginning of fiscal 2008, there have not been any material changes affecting BASF’s situation or its competitive environment.