Bayer Second-Quarter Profit Gains 5.7% Amid Monsanto Pursuitby
German company trims its revenue forecast for this year
Crop sciences sales to be flat in “weak market environment”
Bayer AG, the German chemicals company seeking to acquire Monsanto Co., reported a 5.7 percent increase in second-quarter profit as prescription-drug sales helped offset weakness in its crop sciences and consumer health units.
Earnings before interest, taxes, depreciation and amortization, and excluding some costs, climbed to 3.05 billion euros ($3.36 billion), the Leverkusen, Germany-based company said in a statement on Wednesday. That compared with the 3 billion-euro average of analysts’ estimates compiled by Bloomberg. Bayer also pared its sales forecast for 2016.
Shares of Bayer rose 1.2 percent to 94.53 euros as of 9:05 a.m. in Frankfurt trading. The stock has declined 18 percent this year.
The pharmaceutical division continues to grow, with sales in 2016 likely to top 16 billion euros because of its newly launched drugs, Bayer said. Those include blood thinner Xarelto and eye treatment Eylea, which accounted for a quarter of its pharmaceutical sales last year, as well as cancer drugs Xofigo and Stivarga, and Adempas, to treat a deadly lung disease.
The results are likely to be overshadowed by any comments on Bayer’s $55 billion bid to acquire St. Louis-based Monsanto. Werner Baumann, who became chief executive officer in May after more than 20 years with the company, aims to make it the world’s largest producer of seeds and pesticides with the deal. His revised offer, which included a $3-per-share increase, was spurned earlier this month.
Sales this year, including revenue generated from Covestro AG following its spin off from Bayer, will probably climb to 46 billion euros to 47 billion euros, the company forecast. That’s down from an earlier projection of more than 47 billion euros. Ebitda before special items is likely to rise by a high-single-digit percentage, rather than a mid-single-digit percentage, it said.
The company will hold a call with investors at 2 p.m. local time.