Turnover at BASF Ireland increases by 12% to £24.8m

BASF Ireland, the chemical products subsidiary of the German BASF group, has recorded a 12 per cent increase in sales to €31.5 million (£24.8 million) in the first half of 2000. But the share price in the parent company slumped by more than 6 per cent, weighing on the DAX index as investors sold the stock despite results which were in line with expectations.

BASF was the main mover on the DAX, with the share price 6.77 per cent down at €42.15 with more than four million shares traded on the XETRA electronic trading system, following the announcement.

BASF fell more than 7 per cent at one stage after it failed to raise its full year forecast during first-half results and reported higher-than-expected restructuring costs. It ended with a fall of more than 6 per cent.

Traders said BASF shares were hit by investors selling on good news while analysts said the group's failure to raise its full-year forecast, its inability to improve profits at all divisions and higher-than-expected restructuring costs weighed on the share price.

The group increased its sales by 24 per cent to €9 billion in the second quarter. The Irish subsidiary said its results for the first half reflect "the general trend in the Irish economy and indicates a growth of our market share in all three operating divisions".

The chemical and specialities division represents about half of the turnover. A major contributor has been the continued growth of intermediate chemicals to the pharmaceutical industry and increased concentration on products supplied to the fine chemicals and food industries.

In the agriculture and nutrition division BASF said it continued to maintain a leading position in the crop protection market. Its fungicides, Opus and Allegro, "are a major contributor. . . giving excellent results".

Ultra Polymers Ireland, its in-house distributor of the BASF thermoplastic range of polymers, "has also performed strongly and continues to build up a significant market share".

BASF Ireland is based in Blackrock, Co Dublin, and employs 21 people in the sale and distribution of its products.