Bayer: sales and EBIT at record levels

The Bayer Group had a very successful year in 2011 both strategically and operationally, posting record levels of sales and EBIT. "We achieved the Group targets that we raised after the first quarter," said Bayer CEO Dr. Marijn Dekkers at the Financial News Conference in Leverkusen on Tuesday. The company also made good progress toward further innovation and expanding its activities in emerging markets. For 2012 Dekkers predicted a slight improvement in underlying earnings despite an economic situation marked by uncertainty.

Special items totaled minus EUR 876 million (2010: minus EUR 1,722 million). They included EUR 741 million in charges for the Group-wide restructuring initiative, EUR 260 million in litigation expenses, and EUR 99 million in gains from divestitures. EBIT before special items increased by 12.9 percent to EUR 5,025 million (2010: EUR 4,452 million). Earnings before interest, taxes, depreciation and amortization (EBITDA) - before special items - rose by 7.2 percent to EUR 7,613 million (2010: EUR 7,101 million). There was a particularly sharp increase of 89.9 percent in net income, to EUR 2,470 million (2010: EUR 1,301 million). Core earnings per share moved ahead by 15.3 percent to EUR 4.83 (2010: EUR 4.19).

Gross cash flow advanced by 8.4 percent to EUR 5,172 million (2010: EUR 4,771 million), while net cash flow declined by 12.4 percent to EUR 5,060 million (2010: EUR 5,773 million). Net financial debt fell by EUR 0.9 billion against December 31, 2010, to EUR 7.0 billion. "Our remaining financial liabilities have an even maturity structure, so we aim to make all repayments in the coming years out of available liquidity and current cash flows," said CFO Werner Baumann.

"The MaterialScience business unfortunately performed below expectations in 2011," said Dekkers. "A positive factor is that we increased sales, and were able to raise selling prices, in all business units and regions. On the other hand, we scarcely achieved any volume increases." Sales of high-tech materials rose by 6.7 percent (Fx & portfolio adj. 8.2 percent) overall to EUR 10,832 million (2010: EUR 10,154 million).

Business with raw materials for foams (Polyurethanes) improved by 9.5 percent (Fx & portfolio adj.). High-tech plastics (Polycarbonates) advanced by 5.6 percent, while raw materials for coatings, adhesives and specialties were up by 4.5 percent (both Fx & portfolio adj.). Industrial Operations achieved a sales gain of 21.9 percent (Fx & portfolio adj.).

EBITDA before special items of MaterialScience moved back by 13.6 percent to EUR 1,171 million (2010: EUR 1,356 million). This decline resulted primarily from higher raw material costs that could not be fully offset by selling-price increases. Higher operating costs were also incurred, including those for commissioning the TDI plant in China. Among the positive effects were savings achieved through efficiency-improvement measures.

Source: Bayer