Bayer 1Q Earnings Beat Expectations -- Earnings Review

By Cecilia Butini

Bayer AG reported first-quarter earnings on Wednesday. Here is what you need to know.

SALES: Bayer reported sales of 12.33 billion euros ($14.98 billion), beating a company-provided consensus of EUR11.88 billion but declining slightly from EUR12.85 billion the company posted in the same period the year prior.

NET PROFIT: Net profit climbed to EUR2.09 billion from EUR1.49 billion the previous year, also beating a company-provided consensus, which saw the metric at EUR1.62 billion.

EBITDA BEFORE SPECIAL ITEMS: The metric also beat consensus expectations, coming in at EUR4.12 billion versus the expected EUR3.82 billion. It dropped slightly from EUR4.39 billion the previous year, however.

WHAT WE WATCHED:

-CROP SCIENCE: The division was the major driver of the sales beat, and it could have upside potential especially if a judge in the U.S. next week rules favorably on the proposed settlement of claims that herbicide Roundup causes cancer, Citi analysts say. The approaching resolution to the litigation, together with an improving outlook at the crop-science division could drive sentiment improvement, according to the analysts. The first quarter is usually the strongest for crop science in terms of both earnings and sales, Bryan Garnier analysts say.

-PHARMACEUTICALS: Sales remained mostly flat on-year at the division, which develops prescription medication, as sales of blood-thinner drug Xarelto came in below expectations, Bryan Garnier says. Sales were particularly dragged down in Germany, Bayer said. The drug is going to remain in focus in the coming years as it and eye treatment Eylea are going to lose their exclusivity rights, and that is an issue for the future of the division, according to Bryan Garnier.

Write to Cecilia Butini at [e-mail]

(END) Dow Jones Newswires

May 12, 2021 09:55 ET (13:55 GMT)

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