BAYRY - Bayer Q1 sales dips as crop pharma segments decline; glyphosate prices weigh on outlook
2023-05-11 05:22:44 ET
Bayer ( OTCPK:BAYRY ) ( OTCPK:BAYZF ) said it saw a slow start to year as Q1 sales in Crop Science and Pharmaceuticals both saw a decline, while Consumer Health segment grew.
CEO Werner Baumann said that for the remainder of the year Bayer sees potential risks mainly due to significantly reduced market price expectations for glyphosate-based products .
"We continue to expect performance to improve in our other businesses in the second half of the year,” Baumann added . "Overall, we expect target attainment to come in at the lower end of our guidance."
Q1 core EPS fell -16.4 Y/Y on reported basis to €2.95. The German conglomerate said Group earnings were mainly weighed down by the glyphosate business and inflation, and were also impacted by R&D investment at Pharmaceuticals, which remained high.
Group sales fell -1.7% Y/Y (-1.1% on a currency and portfolio-adjusted basis, or Fx & portfolio adj.) to ~€14.39B.
Sales from Crop Science business in Q1 declined -1.1% Y/Y (-1.1% on Fx & portfolio adj.) to ~€8.35B.
Bayer said Crop Science division recorded a significant decline in sales of glyphosate-based products which was almost fully offset by the other parts of its business.
Q1 sales in Herbicides fell +24% Y/Y (+24.3% Y/Y on Fx & portfolio adj. basis) to ~€1.89B.
Herbicides business saw a significant decline in sales due to lower volumes and prices for its glyphosate-based products. However, other herbicide products saw higher sales due to increased prices, according to the company.
Sales at Corn Seed & Traits in Q1 climbed +18.6% Y/Y (+15.8% on Fx & portfolio adj. basis) to ~€3.27B.
Sales from the Pharmaceuticals division declined -4.7% Y/Y (-3.1% on Fx & portfolio adj.) to ~€4.41B.
Bayer said the decline was mainly due to tender procedures in China, especially for Xarelto and Adalat. Meanwhile, pandemic related developments also weighed on sales in China.
However new products — cancer drug Nubeqa and Kerendia for chronic kidney disease linked with type 2 diabetes, saw gains — alongside growth in the Radiology business.
Blood clot prevention therapy Xarelto sales fell -13.2% Y/Y (-12.8% on Fx & portfolio adj.) to ~€943M, while high blood pressure drug Adalat's sales declined -25.9% Y/Y (-23.9% on Fx & portfolio adj.) to ~€177M.
Sales of wet-AMD drug Eylea , developed with Regeneron ( NASDAQ: REGN ), grew +1.9% Y/Y (+4.5% Fx & portfolio adj.) to €789M.
Prostate cancer drug Nubeqa sales in Q1 grew +134.2% Y/Y (+130.7% Fx & portfolio adj.) to €178M. Kerendia sale rose +372.7% Y/Y (+361.7% Fx & portfolio adj.) to €52M.
Gadovist product family sales grew +9.3% Y/Y (+10.5% Fx & portfolio adj.) to €118M.
Birth control product Mirena /Kyleena/Jaydess sales increased +2.7% Y/Y (0.9% Fx & portfolio adj.) to €303M.
Sales from Consumer Health segment rose +4.0% Y/Y (+4.1% Fx & portfolio adj.) to ~€1.57B, mainly driven by Allergy & Cold and Dermatology categories. However growth was slowed by temporary supply constraints, the company added.
Sale from Allergy & Cold segment rose +19.2 Y/Y (+15.9% Fx & portfolio adj.) to €410M, while Dermatology division grew +10.2 Y/Y (+10.3% Fx & portfolio adj.) to €345M.
Outlook :
Bayer confirmed its outlook but target attainment is expected to come in at the lower end.
During Q4 results the company noted that on a currency-adjusted basis, it expects sales between €51B and €52B in 2023. Meanwhile, core EPS range of €7.20 to €7.40 on acurrency-adjusted
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Bayer Q1 sales dips as crop, pharma segments decline; glyphosate prices weigh on outlook