Martin Brudermüller: Yes, Matthew, maybe from my side, a little bit to the downstream situation. I mean, the downstream is a mixed bag. That is very clear. But if we look on ag chemics, ag which is performing very well, I think we clearly improved the performance. I think also the Industrial Solutions actually provide a very stable performance through difficult times. We talked about coating as it’s really a super run now even in this difficult time. So, I think we have to really differentiate a little bit the view on our different downstream pieces here. The Nutrition & Health, very clear, we are not confident with that. But if we compare in that case, also the numbers of our major competitors, by the way, one also is releasing numbers today, then I would say we have also very much a market topic here, particularly in the vitamins business, capacity topics, overcapacity topics, but also a very — of market development.
So, we have actually already in July 2022 announced that we are restructuring the Nutrition business. We have actually brought together the Human Nutrition and Animal Nutrition business units into one business unit, which is Nutrition Ingredients. So, that’s repositioned ourselves as an ingredients provider and know that our very strong, also Verbund integrated aroma chemicals, citral vitamins business is actually going into both areas in markets on human and animal and also the carotenoids business. Let me also mention that we are very confident going forward because with all of the investments we have done in vitamin A, both on capacity, but also formulation side, we have a very clear indication that we, also in the past, even better in the future, have the best cost position in the industry.
Is that, let’s say, a situation that improves tomorrow? It most probably will be some battle. But normally the strongest goes out from the yard is the strongest. And I think this is also the case with BASF. So, it is a repositioning. It is a partial restructuring here, but I think we have good cards in our hands to go on with that business in a very strong path and in a strong way and contribute also to the downstream performance of BASF in the future. And with that, for ECMS business and to Dirk.
Dirk Elvermann: Yes, I’ll take the ECMS question. So, first of all, we are very satisfied with the carve-out. It was completed exactly as we hoped from. And now we have their business fully dedicated. It’s an excellent go-to-market organization, lean back-end structure, service structures, dedicated ERP systems sitting there and we think sits in the right place. It is very industry focused. And I think important here to understand the business is still a very cash generative, fully invested, highly profitable, and it has a long tail. I mean, it’s a sunset business, ultimately, because everybody is clear that the combustion engines market will not last forever. What we believe that there is quite noteworthy period still and we are enjoying very much this business.
Does it also create flexibility at the end if you have such a business carved out? This is certainly the case. But let me be very clear, so the first and foremost intention was really to profile the business better in the BASF Group of companies and not too divest it.
Matthew Yates: Understood. Thanks a lot.
Stefanie Wettberg: So, now we come to Chetan Udeshi, JPMorgan. Please go ahead.
Chetan Udeshi: Yes, hi. Thanks for letting me ask question. I think the first question I had was you mentioned the impact from cracker outages in the US and China. Are these even profitable at these levels? I’m just trying to understand whether you actually lost any earnings because of these outages or actually, it saved you from having bigger losses in your upstream business? That’s the first question. And the second question I had was I see you are sort of implying Q4 to be sequentially down versus Q3, which is normal seasonality. But if you can give us some sort of feel of how you see the earnings development by different sort of segments. As we think about Q4 versus Q3, I think it will be useful, especially given the number of moving parts on energy costs and clearly, now the naphtha prices are going up, what it means for your upstream business?
And last question is on your Ag business. Of course, we’ve seen a few of your peers seeing significant earnings pressure. I think, so far, from Q3 perspective, we’ve had very weak volumes, but also much better pricing. Can you talk about what you see in Q4? Because I think your peers are talking about weaker LatAm demand for the ongoing season in LatAm. How do you see that dynamic in volumes and pricing play out in Q4? Thank you.
Dirk Elvermann: Chetan, Dirk speaking. So, maybe I’ll take the first and the last question, starting with the cracker. Yes, indeed, we would have loved to avoid the cracker outages because both profitable. The one in Nanjing, China, which is already on stream again is — so there, the impact was, I’d say, limited also due to the short time of the outage. So, this was a mid-single-digit million amount. The harder hit was the cracker in Port Arthur, which is now, as we speak, being ramped up again. And here, we are talking a double-digit — mid-double-digit amount. So, yes, we would have loved to avoid that. Unfortunately, it hit us. But the good news is that the one cracker is on stream again and the other is about to be onstream again.
On the Ag situation going forward and you referred to the competitors who are also coming with not so good forecast into the — but I’d say, if you take them, and I’m not now going one by one, there’s always special situations why the performance is as it is. I think we, this year, have in terms of portfolio, also in terms of timing, we had quite a preferable situation with strong pricing power overall with a very strong first half of the year. And now, obviously, in the second half, first of all, it’s anyway the weaker half of the year, there’s high seasonality in the business, as we know. And also, we see now that the Southern Hemisphere, first of all, is delayed. It is coming later in than in the previous years and also coming a bit weaker.
So, we also see that. But I’d say we are in a comparatively resilient situation compared to what we might have heard elsewhere.
Martin Brudermüller: Chetan, maybe a couple of comments to Q4. I mean, if you look on what is now missing and look at the order of magnitude here, let me, first of all, say that the average of the Q4 since 2004 was around €900 million. We had only two years that was — or since 2004, actually twice where it was below €500 million. So, there, we had the low end. And this is the order of magnitude we need to close the gap to the lower part of the guidance. We are confident that we can reach this. This is why we keep the guidance. One element is certainly that everything you can in-house, self-help measures, cost containment. We have a very high cost discipline. You see also the discipline here with the inventory. So, the troops are really aligned and do the utmost to avoid any surprises here.
