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Bayer Q3 Profit Down 63.9%, But Core Earnings Rise; Updates FY19 Outlook

Bayer Group (BAYZF.PK,BAYRY.PK,BYR.L) on Wednesday reported that its third-quarter net income fell 63.9 percent to 1.04 billion euros from 2.87 billion euros last year, which included a substantial divestment gain.

Earnings per share fell 64.2 percent to 1.05 euros from 2.93 euros in the year-ago period. However, core earnings per share from continuing operations were 1.16 euros, compared to 1.09 euros a year ago.

EBITDA before special items of the Bayer Group rose 7.5 percent to 2.29 billion euros from 2.13 billion euros last year. There was a positive effect of about 110 million euros from IFRS 16, which has been applied since January 1, 2019.

Group sales in the third quarter rose 6.1 percent to 9.83 billion euros from 9.26 billion euros last year. Sales rose 5.4 percent, adjusted for currency and portfolio effects.

Bayer noted that its outlook for fiscal 2019 that was published in February of this year was issued on the basis of all businesses being continuing operations.

However, due to the progress that has since been made with the divestment of Animal Health and the stake in Currenta, the original forecast has been aligned to exclude the sales and earnings contributions from these businesses, which are now reported as discontinued operations.

Bayer now anticipates full-year Group sales of about 43.5 billion euros, which continues to correspond to an increase of around 4 percent on a currency- and portfolio-adjusted basis.

On the same basis, EBITDA before special items in fiscal 2019 is expected to come in at around 11.5 billion euros, while core earnings per share are expected to be approximately 6.35 euros.

Earlier, Bayer forecast Group sales of around 46 billion euros, an increase of approximately 4 percent on a currency and portfolio adjusted basis, a currency-adjusted increase in EBITDA before special items to about 12.2 billion euros, and core earnings per share of around 6.80 euros.

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