BASF announced a 5% drop in sales to €17.4 billion for Q3 2015, considerably lower than the previous quarter, in an economic environment weaker than expected for the company. The sharp drop in the price of oil led to significantly lower prices, impacting sales in both the chemicals business and oil and gas segment.

The company’s adjusted EBIT in the quarter through September slipped 10% to €1.60 billion euros.

After announcing the cut of its full-year earnings guidance on weak demand and sliding local currencies in China, Brazil and other emerging markets, the shares fell more than 4%.

“We experienced a pronounced summer lull and no volume momentum in September. Major markets like Brazil are in a recession, or face lower growth rates, such as China,” said Kurt Bock, Basf’s Chief Executive Officer.

China’s economic growth was under 7% for Q3, hurt by cooling investment and following a stock market plunge and a devaluation of the yuan. The Asia-Pacific region accounted for 16.5% of BASF group sales in the first nine months of 2015.

Profit was affected by factors such as lower volumes in the pigments business, weak demand for oil field chemicals and tough competition in vitamins, among other factors.

Sales in the coatings division grew slightly compared the same period in 2014, largely attributed to higher prices and positive currency effects. Volumes were slightly down year-on-year. The company reported achieving a considerable sales increase in the automotive OEM coatings business, primarily through higher volumes in Europe and North America and currency effects. The industrial coatings business saw a slight increase in sales.

Source: Reuters