By Ludwig Burger
LUDWIGSHAFEN, Germany (Reuters) - German chemicals maker BASF <BASFn.DE> will launch a programme to boost annual earnings by 2 billion euros ($2.3 billion) from 2021 onwards but flagged slower profit growth compared with previous years.
The programme to shore up earnings before interest, taxes, depreciation and amortisation (EBITDA), "will include measures focused on production, logistics, research and development as well as digitalisation and automation activities and organizational development," it said in a statement on Tuesday.
A spokesman said the programme, dubbed "excellence", would include cutting costs and growing revenue.
Still, BASF said it was targeting an annual increase in EBITDA before special items of 3-5 percent, without specifying a time frame, down from 8 percent annual growth on average since 2012.
"The first glance on BASF’s new strategy, which only targets 3-5 percent EBITDA growth per annum despite a new excellence program .... might therefore be a disappointment," analysts at brokerage Baader Helvea wrote in a note.
The shares were down 0.6 percent at 68.60 euros after the market open at 0800 GMT.
Chief Executive Martin Brudermueller, who took over in May, reaffirmed his support for the group's integrated supply chain of BASF-owned businesses throughout the production process, which it dubs "Verbund".
"The Verbund will continue to play a central role for BASF. BASF's portfolio has unique benefits because of physical as well as technological, market-related and digital Verbund advantage," the company said.
In May, Brudermueller, came out in favour of keeping divergent businesses folded into the company, at a time when its major rivals such as DowDuPont <DWDP.N> are breaking themselves up.
BASF would focus primarily on organic growth through investment and innovation with a focus on China - the world's largest market for chemicals and plastics - but would make acquisitions where necessary, it added.
(Reporting by Ludwig Burger, editing by Riham Alkousaa and Louise Heavens)