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Last Update: 03/12/2009
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Part of the audited Consolidated Financial Statements and Management´s Analysis

B -- Scope of consolidation

The Consolidated Financial Statements include BASF SE, the parent company, with its headquarters in Ludwigshafen, Germany, as well as all the material subsidiaries in which BASF SE directly or indirectly exercises a majority of the voting rights (collectively, the “Company”). Material, jointly operated companies are included on a proportional consolidation basis.

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Scope of consolidated

 

 

2008

2007

Consolidated companies as of January 1

297

328

Thereof proportionally consolidated

18

19

First-time consolidations

22

20

Thereof proportionally consolidated

1

(1)

Deconsolidations

26

51

Thereof proportionally consolidated

Consolidated as of December 31

293

297

Thereof proportionally consolidated

19

18

Associated companies are accounted for using the equity method. These are companies in which the Company has an interest of at least 20% or can exercise a significant influence over the operating and financial policies. In total, this applies to:

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Companies consolidated using the equity method

 

 

2008

2007

Subsidiaries

8

10

Joint ventures

4

4

Other associated companies

5

6

 

17

20

First-time consolidations in 2008 comprised:

  • the formation of two new holding companies headquartered in Chile and Canada
  • three companies from the Revus Group acquired in December in the Oil & Gas segment
  • four companies from the Sorex Group acquired in December in the Agricultural Solutions segment
  • an additional 13 companies, which were consolidated due to their increased importance, headquartered in Germany, the Russian Federation, the Netherlands, Norway, Romania, Iran, Vietnam, Kazakhstan and the Dominican Republic

In 2008, 26 companies were deconsolidated due to merger or immateriality.

First-time consolidations in 2007 comprised:

  • the formation of three companies headquartered in South Africa, the Netherlands and the United States
  • the Chinese manufacturer of catalysts for motorcycles and small engines, Guilin REEcat Catalyst Co., Ltd, in Guilin, China, acquired in April
  • a project company which was acquired through Winters-hall’s asset swap with Gazprom
  • an additional 15 subsidiaries due to their increased importance, which were previously not consolidated, with headquarters in Germany, the Netherlands, India, the Czech Republic, China and the United States

In 2007, 51 companies were deconsolidated due to merger, sale or immateriality.

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Effects of changes in the scope of consolidation

 

 

2008
million €

2008
%

2007
million €

2007
%

Sales

(43)

(0.1)

18

.

 

 

 

 

 

Long-term assets

.

.

1

.

Thereof property, plant and equipment

24

0.2

1

.

Short-term assets

38

0.2

.

.

Thereof cash and cash equivalents

15

0.5

(14)

(1.6)

Total assets

38

0.1

1

.

 

 

 

 

 

Stockholders’ equity

2

.

18

0.1

Long-term liabilities

5

.

(4)

.

Thereof financial indebtedness

7

0.1

2

.

Short-term liabilities

31

0.2

(13)

(0.1)

Thereof financial indebtedness

(10)

(0.2)

8

0.2

Total stockholders’ equity and liabilities

38

0.1

1

.

Contingent liabilities and other
financial obligations

.

.

1

.

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Financial information on proportionally consolidated companies (million €)

 

2008

2007

Income statement information

 

 

Sales

5,392

4,178

Gross profit on sales

278

368

Income from operations

173

285

Income before taxes and minority interest

169

301

Net income

167

306

 

 

 

Balance sheet information

 

 

Long-term assets

1,282

1,238

Thereof property, plant and equipment

1,178

1,159

Short-term assets

959

960

Thereof marketable securities, cash and cash equivalents

49

31

Total assets

2,241

2,198

Stockholders’ equity

783

862

Long-term liabilities

627

538

Thereof financial indebtedness

296

218

Short-term liabilities

831

798

Thereof financial indebtedness

163

39

Total stockholders’ equity and liabilities

2,241

2,198

Contingent liabilities and other financial obligations

175

137

 

 

 

Consolidated statements of cash flows

 

 

Cash provided by operating activities

320

280

Cash used in investing activities

(84)

(129)

Cash provided by (used in) financing activities

(223)

(198)

Net changes in cash and cash equivalents

13

(47)

Proportionally and at equity consolidated companies

Proportionally consolidated companies of major significance are as follows:

  • Wintershall Erdgas Handelshaus GmbH & Co. KG, Berlin, Germany; Wintershall Erdgas Handelshaus Zug AG, Zug, Switzerland as well as ZAO Achimgaz, Novy Urengoy, the Russian Federation, joint ventures with Gazprom through which gas trading activities and the production of natural gas and condensate in Siberia are operated
  • ELLBA C.V., Rotterdam, the Netherlands and ELLBA Eastern Private Ltd., Singapore, which are operated jointly with Shell and produce propylene oxide and styrene monomer
  • BASF DOW HPPO Production B.V.B.A., Antwerp, Belgium, which is operated jointly with Dow to produce propylene oxide (PO)
  • BASF-YPC Company Ltd., a joint venture between BASF and Sinopec, that operates the Verbund site in Nanjing, China.

A complete listing of all proportionally consolidated companies is available in the List of Shares Held.

The following associated companies of major significance have been accounted for using the equity method: Solvin Group (BASF stake: 25%), Heesung Catalysts Corporation, Seoul, South Korea (BASF stake: 49%), N.E. Chemcat Corporation 1 ,Tokyo, Japan (BASF stake: 42%), Nord Stream AG, Zug, Switzerland (BASF stake: 20%), OAO Severneftegazprom, Krasnoselskusky, the Russian Federation (BASF stake: 25%, share of economic rewards: 35%), and Shanghai Lianheng Isocyanate Co. Ltd., Shanghai, China (BASF stake: 35%). Consolidated financial information is shown below:

1 The market capitalization of the 42% stake in N.E. Chemcat Corporation amounts to a total of 
   €106 million as of December 31, 2008.
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Financial information on companies consolidated using the equity method (million €)

 

 

2008

2007

Income statement information

 

 

Sales

3,132

2,736

Gross profit on sales

1,912

475

Income from operations

295

254

Income before taxes and minority interests

(234)

251

Net income

(198)

167

BASF’s share of net income

(68)

54

 

 

 

Balance sheet information

 

 

Long-term assets

2,971

2,467

Thereof property, plant and equipment

2,205

2,261

Short-term assets

2,453

1,851

Thereof marketable securities, cash and cash equivalents

1,155

369

Total assets

5,424

4,318

Stockholders’ equity

2,590

1,430

Long-term liabilities

425

1,885

Thereof financial indebtedness

233

1,379

Short-term liabilities

2,409

1,003

Thereof financial indebtedness

1,818

116

Total stockholders’ equity and liabilities

5,424

4,318

BASF’s proportional interest

800

484

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