Thanks to the agricultural business, Bayer expects a very successful start to the year

Frankfurt Despite the war in Ukraine, Bayer boss Werner Baumann is optimistic about the business of the agricultural and pharmaceutical group. Despite all the uncertainties in the world, a very successful start to the year is emerging for Bayer, said Baumann in the speech published on Monday evening at the Annual General Meeting on April 29.

“Especially in the agricultural business, we see a much more positive market environment than in previous years.” The economic consequences of the war and the associated sanctions are not yet visible in the first quarter. Bayer wants to publish the figures on May 10th.

According to Vara Research, analysts expect an average increase in sales of 13.54 billion euros and an adjusted operating profit (Ebitda) of 4.4 billion for the first quarter. Baumann confirmed the forecast for the current financial year.

Adjusted for currency effects, he still expects sales to increase by five percent to around 46 billion euros and an adjusted operating return (EBITDA margin) of around 26 percent. “For the year as a whole, we assume that the good growth in our businesses will continue and that the positive development will continue.”

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The fund company Union Investment, which according to Refinitiv data is one of the 20 largest shareholders in Bayer, praised in its speech at the Annual General Meeting that the three business areas of agriculture, pharmaceuticals and over-the-counter medicines are currently running smoothly. The group has also made “good progress” with the glyphosate lawsuits in the USA.

Shareholders await Supreme Court decision

“Shareholders are now awaiting the Supreme Court’s decision in the glyphosate dispute. If the highest US court decides in favor of Bayer and the share price does not recover further, the call for spin-offs will become louder in order to create more value for the shareholders,” explained Janne Werning from Union Investment in advance.

He criticized the current stock market value of around 65 billion euros as “frighteningly little” despite the recent price recovery. In his estimation, if Bayer were to be spun off, it could first go public with its over-the-counter medicines division as part of a spin-off. “A complete split of the group into the three parts of agriculture, pharmaceuticals and over-the-counter medicines does not make sense in the first step because of the complexity.”

>>> Read our balance sheet check on Bayer here: Bayer frees itself from Monsanto burdens – but the decisive step is pending

Baumann has always emphasized that he wants to stick to the Leverkusen group’s set-up despite the trend towards splitting up. The setup in three stores allows Bayer the “staying power” that research needs, he said in the speech.

More: Bayer frees itself from Monsanto burdens – but the decisive step is pending

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