Bayer Shares Fall After 4Q Results, 2021 Guidance
By Joshua Stein
Shares in Bayer AG fell Thursday after it reported a decline in
fourth-quarter profit and provided outlook for 2021.
At 1122 GMT, Bayer shares were down 3.8% at EUR53.01.
The German pharmaceutical and chemical conglomerate said net
profit for the period fell by around 78% to 308 million euros
($374.9 million) from EUR1.41 billion a year earlier.
For the full year, Bayer swung to a net loss of EUR10.50
billion, compared with a profit of EUR4.09 billion in 2019.
Earnings before interest, taxes, depreciation and amortization
before special items came in at EUR2.39 billion for the quarter,
down from EUR2.48 billion.
Quarterly sales were at EUR10.00 billion, down from EUR10.75
billion, and slightly lower than analysts' expectations of EUR10.01
billion, according to a consensus provided by Vara Research.
Net debt came in at EUR30.04 billion at the end of 2020, down
from EUR34.07 billion in 2019, the company said.
Bayer proposed a dividend of EUR2.00 per share for 2020, in
comparison to EUR2.80 the previous year.
Warburg Research analyst Ulrich Huwald said Bayer's sales and
adjusted Ebitda came in below expectations and were
"disappointing", mainly due to a miss at the company's crop science
segment. "The Roundup litigation remains a burden for Bayer with an
unforeseeable outcome," Huwald added.
Citi analysts said the company's growing research and
development as well as pharma-related investments may preoccupy the
market, which could "require a reset of margin expectations at
Pharma." Meanwhile, the company faces questions on its ability to
attract investors from an ESG perspective, while its pharma outlook
may become uncertain when patents for its Xarelto and Eylea drugs
run out in the coming years, Citi added.
Bayer said its $2 billion proposal over future litigation
regarding its glyphosate-based weedkiller--which it announced
earlier in February--is subject to court approval.
Looking ahead, Bayer expects sales between around EUR42 billion
and EUR43 billion for 2021, with an Ebitda before special items of
EUR11.2 billion to EUR11.5 billion, both on currency-adjusted
The company expects a negative free cash flow of between EUR3
billion and EUR4 billion, which includes EUR8 billion which it has
set aside for Roundup-related litigation.
Write to Joshua Stein at firstname.lastname@example.org
(END) Dow Jones Newswires
February 25, 2021 06:55 ET (11:55 GMT)
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