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Nov. 8, 2022 Source: Bayer news release Leverkusen - The Bayer Group maintained its strong business performance across all three divisions in the third quarter. "Despite rising inflation and global supply chain problems, we were again able to boost sales and earnings," said Werner Baumann, Chairman of the Board of Management, when presenting the company's quarterly statement on Tuesday. Crop Science in particular continued its growth trajectory, and Pharmaceuticals and Consumer Health also saw sales rise against the prior-year quarter. Baumann confirmed the Group outlook for 2022. "We are right on track to achieve the full-year financial targets that we raised in August." Bayer expects the cost increases triggered by high inflation to continue next year. In Germany, the company aims to be independent of Russian gas by the end of the year. As global supply chains remain very much under strain, procurement management and supply chain stability are top priorities for Bayer. In order to shore up supply chain stability and mitigate the impact of any supply bottlenecks, the company is working closely with suppliers and contract manufacturers and is continuing to build up inventories. Third-quarter Group sales rose by 5.7 percent to 11.281 billion euros on a currency- and portfolio-adjusted basis (Fx & portfolio adj.). Sales benefited from positive currency effects of 940 million euros (Q3 2021: 67 million euros). EBITDA before special items increased by 17.3 percent to 2.451 billion euros. This figure included a negative currency effect of 78 million euros (Q3 2021: 44 million euros). EBIT came in at 1.199 billion euros (Q3 2021: 530 million euros) after net special charges of 153 million euros (Q3 2021: 694 million euros). Net income amounted to 546 million euros (Q3 2021: 85 million euros), and core earnings per share advanced by 7.6 percent to 1.13 euros. Free cash flow declined by 11.1 percent to 1.738 billion euros. The company was able to reduce its net financial debt to 35.884 billion euros as of September 30, down 1.9 percent from June 30, 2022. Cash inflows from operating activities were partly offset by negative currency effects. Sustained growth momentum at Crop Science Sales in the agricultural business (Crop Science) rose by 8.4 percent (Fx & portfolio adj.) to 4.692 billion euros. The division achieved double-digit percentage gains in Latin America and Europe/Middle East/Africa, but saw sales decrease significantly in North America, mainly due to higher seed returns. Sales at Herbicides advanced by 44.9 percent (Fx & portfolio adj.) thanks to price increases, as business continued to benefit from a positive market environment, especially in Latin and North America as well as in Europe/Middle East/Africa. Insecticides sales were up 9.1 percent (Fx & portfolio adj.), mainly driven by business in Latin America. Sales at Corn Seed & Traits decreased by 15.8 percent (Fx & portfolio adj.) in the third quarter, but are up overall this year. In the July-September period, higher prices in Latin America only partly offset the impact of lower licensing revenues and higher returns due to lower acreages in North America. Sales at Soybean Seed & Traits were down 8.3 percent (Fx & portfolio adj.), largely due to higher returns in North America. However, business expanded in Latin America thanks to higher volumes and prices. EBITDA before special items at Crop Science advanced by 33.5 percent to 629 million euros, primarily driven by its good business performance. The division also benefited from contributions from ongoing efficiency programs. By contrast, earnings were diminished by an increase in costs, particularly in the cost of goods sold, which was mainly due to high inflation. The EBITDA margin before special items increased by 1.2 percentage points to 13.4 percent. To read the entire report click here. Tweet |
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