By Ludwig Burger
LUDWIGSHAFEN, Germany (Reuters) - BASF, the world's largest chemical company by sales, warned investors of a drop in operating income this year on weak chemical sales volumes in China and as the lower crude price weighs on its oil and gas division.
Earnings before interest and tax (EBIT), adjusted for one-off items, will decline slightly this year, BASF said on Friday.
"This is an ambitious goal in the current volatile and challenging environment, and is particularly dependent on the development of the oil price," Chief Executive Kurt Bock said in a statement.
In China, where it makes about 8 percent of group sales and operates a petrochemicals and specialty chemicals joint venture, BASF expects economic growth to continue to decelerate slightly.
With crude oil trading about one third below year-earlier levels, it sees a significant drop in earnings at its Wintershall oil and gas division.
BASF, whose products in include catalytic converters, engineering plastics and battery chemicals, saw net income drop 23 percent to 4.0 billion in 2015, slightly above the average analyst estimate but the lowest full-year result since 2009.