Bayer Sees FY21 Sales Similar to FY20 Despite Covid-19 Effects
September 30 2020 - 3:21PM
Dow Jones News
By Kimberly Chin
Bayer AG expects sales for fiscal 2021 to be at similar levels
to fiscal 2020 despite the effects of the Covid-19 pandemic on its
business.
The German pharmaceutical and life-sciences company also expects
2021 core per-share earnings to be slightly below 2020 levels.
Bayer on Wednesday said it would introduce a cost-savings plan
of more than 1.5 billion euros ($1.8 billion) annually from cost
cuts and other moves as of 2024. This is on top of its previously
announced target of EUR2.6 billion in savings as of 2022, the
company said.
This could lead to some job cuts though it is too early to say,
Bayer said.
"We believe the additional measures are necessary to accelerate
our overall transformation, generate margin improvements and thus
maintain our competitive profile," Chairman Werner Baumann said,
adding that the savings could go toward fueling innovation, growth
opportunities, and reducing debt.
Bayer will also consider exiting non-strategic businesses or
brands.
The pandemic has led to currency headwinds and lower revenue
particularly in the company's crop science and pharmaceuticals
divisions.
The company's agricultural business has been hurt by low
commodity prices for major crops, increased competition for soy and
lower biofuel consumption. The company expects to incur charges in
the mid- to high single-digit-billion euro range on agricultural
assets in the near term.
While it has diminished growth expectations for its agricultural
segment, it expects its pharmaceutical business to return to growth
in 2021. Bayer said it intends to bolster its product pipeline with
next-generation platforms, in-licensing agreements and bolt-on
acquisitions.
Write to Kimberly Chin at kimberly.chin@wsj.com
(END) Dow Jones Newswires
September 30, 2020 15:06 ET (19:06 GMT)
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