Bayer Q1 Results Down, Sees Pharma Results At Top End Of View; Stock Gains

(RTTNews) - Bayer AG on Tuesday confirmed its currency-adjusted 2025 targets after reporting lower earnings in its first quarter with slightly lower sales. The quarterly results reflected weak results in the Crop Science Division, despite growth in Pharmaceuticals and Consumer Health segments.

For fiscal 2025, Bayer expects sales growth and the adjusted EBITDA margin at the Pharmaceuticals Division to come in at the upper end of the previous outlook range.

Shares of the Pharmaceutical and life sciences major were gaining around 6 percent on the XETRA in Germany, at 25.39 euros.

Regarding the new US tariffs, the company added that it is continuously evaluating the impacts of the current geopolitical developments, especially in relation to potential tariffs. Based on current calculations of the financial effects, Bayer does not see a need to revise the full-year guidance.

However, there is considerable uncertainty concerning the future impacts of any potential further developments in relation to this issue, as well as with respect to exchange-rate developments, it said.

CFO Wolfgang Nickl said, "Based on the current status of tariffs announcements and our mitigation measures, we expect to manage the impact, and we confirm our outlook at constant currencies for the full year 2025."

Further, Bayer confirmed the mid-term ambition for Crop Science under the five-year plan for the division to combat industry-wide cost pressures, especially in the crop protection business. The division is expected to achieve above-market growth and deliver more than 3.5 billion euros of incremental sales from innovation by 2029. By the same year, the division is targeting an adjusted EBITDA margin in the mid-20s percentage range.

In its first quarter, Bayer's net income decreased 35.1 percent to 1.299 billion euros or 1.32 euros per share from 2 billion euros or 2.04 euros per share last year.

Core earnings per share from continuing operations was 2.49 euros, 11.7 percent lower than 2.82 euros in the prior year.

Income before taxes of 1.830 billion euros was lower than 2.591 billion euros in the same quarter a year ago, primarily due to lower sales as well as higher expenses.

EBIT declined 24.8 percent to 2.324 billion euros after net special charges of 587 million euros.

Earnings before interest, taxes, depreciation, and amortization or EBITDA decreased 16.8 percent to 3.498 billion euros from 4.205 billion euros a year ago.

Adjusted EBITDA reduced 7.4 percent to 4.085 billion euros from 4.412 billion euros last year.

According to the firm, earnings were held back by the business performance in the Crop Science Division, higher expenses for the Group-wide long-term incentive program and a negative currency effect.

Sales for the quarter dropped 0.2 percent to 13.738 billion euros from 13.765 billion euros in the previous year. After adjusting for currency and portfolio effects, sales edged down 0.1 percent.

In the Crop Science segment, sales in the agricultural business decreased as expected, falling 3.3 percent to 7.580 billion euros. Adjusted EBITDA at Crop Science decreased 10.2 percent to 2.557 billion euros.

However, Pharmaceuticals segment posted higher sales and earnings. Sales of prescription medicines increased by 4.1 percent to 4.548 billion euros and adjusted EBITDA grew 12.4 percent to 1.342 billion euros.

In the Consumer Health segment, sales and earnings grew thanks to volume growth in North America and Asia/Pacific.

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