^{Facts and Figures – BASF in Agriculture}
How We Make A Difference

Since the launch of the “Way Forward” strategy in 2019, we have successfully implemented or started various programs and initiatives to further strengthen and develop our business and culture, such as the “Fast Forward” program and Differentiated Steering. In addition, we have introduced our new vision and mission.

Compared to the “Way Forward” strategy 2019, various changes have been or will be implemented:
 

What is new:

• We steer our business based on crop system strategies, which define the needs for further development in our indications (or strategic business units).
• We have defined three connectors to guide the successful implementation of our strategy (Customers, Innovation, People). These will replace the previous seven levers of the “Way Forward” strategy. We will shape and direct our ‘one team’ spirit towards a Winning Culture that embraces accountability, speed, and an improvement mindset.
• We will steer our investments towards the creation of a more balanced portfolio with an increased seeds and traits share while protecting our leading margin position in crop protection and claiming leadership in digital farming as well as new sustainability business models (e.g., Global Carbon Farming Program).
• We will increase R&D intensity at the upper level of 9-10 percent of net sales to fund transformation / additional scale in seeds & traits while maintaining a strong crop protection pipeline.
• We strongly focus on 15 drive countries.
• We further leverage new technologies and seize opportunities in artificial intelligence and data.
• We implement Differentiated Steering to become a stand-alone company within BASF Group and an attractive pure-play company in the agricultural industry and to unlock additional value via a potential partial IPO.
   

What remains:

• We aim to deliver a great customer experience by organizing ourselves and steering our strategic target picture along crop systems.
• This enables us to create integrated, value-adding solutions via connecting our portfolio.
• We continue cost control with fix cost improvement measures and a SG&A (Selling, General and Administrative Expenses) targeting of 18-19 percent of net sales.

The consistent implementation of Differentiated Steering remains our highest priority for the coming years. We are on track to establish our own company structure, transform our processes, and implement a dedicated, industry-specific SAP system by 2027. This major milestone will significantly enhance our competitive edge against peers.

In addition, we are targeting IPO readiness, which is a prerequisite for pursuing a potential partial IPO. Many of the initiatives we have undertaken and will continue to pursue over the next three years are part of Differentiated Steering. However, we also need to take further steps to achieve IPO readiness, such as establishing a corporate structure suitable for publicly listed companies. This will provide greater clarity about BASF Agricultural Solutions’ overall objectives to all relevant stakeholders, including the capital market.

Consequently, the new business strategy will support the implementation of Differentiated Steering and further drive our path to IPO readiness.

Sustainability remains a core element that drives everything we do and is fully integrated into every aspect of our business and operations. It is not just a goal; it is the foundation of our actions. It is part of our mission. Our approach is about meeting society’s essential needs, helping farmers succeed in the face of climate change, and addressing economic and social challenges. By doing this, we create value for our customers, the environment, and society through our products, solutions, and services, while ensuring the long-term success of our business. This includes our Global Carbon Farming Program and ongoing work to reduce emissions at our sites.

We will continue to advance sustainability by actively preparing a new, impact-driven framework, covering climate, nature and society. We will set ambitious targets that will be shared in the context of our IPO readiness.

Although sustainability isn’t among the connectors, it is more critical than ever. Sustainability is an overarching value that connects everything we do and it is considered an integral part of the new business strategy. It shapes our efforts and guides how we approach the future of agriculture. By incorporating sustainability into the key areas of our business, we ensure it plays a role in our decisions, strategies, and partnerships, while helping to unlock new opportunities for growth

Our strategy aims to create a new, highly differentiated and customer-centric pure-play agricultural company. Through continuously implementing our new business strategy, we will balance financial attractiveness for a potential partial IPO with long-term business development. On this journey, we anticipate following milestones: