) earnings during the first quarter of 2013 came in at €1.70 per
share (approx. $2.24) compared with €1.67 per share (approx.
$2.19) in the year-ago period. Earnings benefited from higher
Bayer recorded 2.1% (3.7% on an adjusted basis) growth in
revenues to €10.3 billion. The increase was primarily driven by
the HealthCare and the Crop Science segments of the company.
Segmental Performance during the Quarter
The three major segments - HealthCare, Crop Science and
Material Science - accounted for approximately 43.3%, 26.9% and
27%, respectively, of total revenues during the first quarter of
2013. Revenues from the Crop Science and HealthCare segments
improved by 5.9% and 2.3% respectively, whereas revenues from the
Material Science segment remained flat year over year.
The HealthCare segment recorded revenues of €4.4 billion in
the reported quarter. Both sub-segments, Consumer Health
(adjusted growth of 4.8%) and Pharmaceuticals (adjusted growth of
5%) performed well in the quarter.
Sales growth in China, Germany and the US boosted the
Pharmaceuticals segment. Growth in the Consumer Health subgroup,
comprising Bayer's over-the-counter drug business for human
beings and animals, was primarily driven by the impressive
performance of the Consumer Care division (growth of 9%).
The Crop Science division, which is engaged in developing and
marketing chemical crop protection products (insecticides,
herbicides, and fungicides), seeds and integrated plant
biotechnology solutions for agricultural and non-agricultural
uses, recorded sales of €2.8 billion in the first quarter of
2013. The Crop Science segment exhibited solid growth
particularly in North America.
The Material Science segment, one of the world's largest
polymer manufacturers, posted sales of €2.8 billion in the
reported quarter. The segment was benefitted by an overall price
increase which was offset by a fall in volume, particularly in
Europe and North America. Bayer expects the segment's second
quarter performance to surpass sales level of the first
2013 Outlook Maintained
Apart from releasing its financial results, Bayer also
maintained its guidance for 2013. Earnings are still expected to
increase in the high single-digit percentage year over year.
Bayer continues to expect 2013 sales around €41 billion, an
increase of 4−5% from the 2012 figure.
Revenues from the HealthCare segment are expected to come
around €19 billion (mid-single-digit percentage growth). The
company expects growth to be driven by new drugs.
Both Consumer Health and Pharmaceuticals sales are expected to
exhibit mid-single-digit sales growth in 2013. Bayer expects
Consumer Health to generate around €8 billion in 2013, whereas
Pharmaceuticals sales are expected to be around €11 billion in
Bayer expects the Crop Science segment to grow in the
high-single-digit percentage range to around €9 billion in
Material Science segment revenues are expected to increase
marginally over 2012 levels to approximately €12 billion.
Bayer currently carries a Zacks Rank #3 (Hold). Other stocks
) currently look more attractive in the pharma space. All these
stocks carry a Zacks Rank #1 (Strong Buy).
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