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Bayer Q4 Profit Climbs, Sees Significant Growth In FY22; Stock Up

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Shares of Bayer Group were gaining around 2 percent in German trading after the pharmaceutical and life sciences company reported Tuesday significantly higher profit in its fourth quarter, with strong sales in all divisions. Looking ahead, Bayer aims to significantly increase sales and earnings in fiscal 2022.

Further, the Board of Management and Supervisory Board will propose to the Annual Stockholders' Meeting on April 29 that the dividend remain unchanged at 2.00 euros per share for fiscal 2021.

For fiscal 2022, Bayer expects core earnings per share of around 7 euros, and EBITDA margin before special items of around 26 percent, corresponding to adjusted EBITDA of around 12 billion euros.

Group sales will be around 47 billion euros in 2022, an increase of about 5 percent after adjusting for currency and portfolio effects.

On a currency-adjusted basis, Bayer is anticipating sales growth of around 7 percent at Crop Science, some 3 to 4 percent at Pharmaceuticals, and approximately 4 to 5 percent at Consumer Health.

In addition, Bayer expects the currency-adjusted EBITDA margin before special items at around 25 to 26 percent at Crop Science, some 32 percent at Pharmaceuticals, and around 22 to 23 percent at Consumer Health.

Bayer said its outlook assumed a stable geopolitical environment in Eastern Europe, which in the meantime has changed dramatically. The company will mitigate these risks to the extent possible.

In fiscal 2021, core earnings per share were 1.02 euros, adjusted EBITDA was 11.18 billion euros, adjusted EBITDA margin was 25.4 percent, and sales were 44.08 billion euros.

Bayer said it reduced its direct and indirect greenhouse gas emissions by 11.5 percent in 2021 and is on course to be carbon-neutral by 2030.

Werner Baumann, Chairman of the Board of Management, said, "We not only met our updated Group forecast, but in fact exceeded it. What's particularly encouraging is that all three divisions grew dynamically in 2021, and what's more, they all outpaced their respective markets."

For the fourth quarter, net income climbed to 1.16 billion euros from 308 million euros in the prior year. Earnings per share were 1.18 euros, up from 0.32 euros in the previous year.

Core earnings per share from continuing operations for the quarter declined 4.5 percent to 1.26 euros from 1.32 euros in the prior year.

EBITDA before special items edged up 0.1 percent from last year to 2.40 billion euros. Adjusted EBITDA margin was 21.5 percent, down from 23.9 percent a year ago.

Sales for the quarter increased 11.2 percent to 11.12 billion euros from 10 billion euros in the previous year. Sales grew 8 percent at constant currency rates.

Crop science sales grew 12.3 percent to 4.69 billion euros, and Pharmaceuticals sales climbed 10.6 percent to 4.95 billion euros. Consumer Health sales were up 12.4 percent.

In Germany, Bayer shares were trading at 52.59 euros, up 2.10 percent.

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