Bayer crop protection sales up 6% in Q1 2014

Bayer CropScience's crop protection sales recorded a 5.7% increase to €2,231 million in the first quarter of 2014, the units showing positive development. Seeds sales boosted by 2.9% to €503 million in this quarter.

Crop Protection segment posted growth in all product groups. Fungicides, SeedGrowth units were very successful and all posted double-digit growth rates in this quarter. Sales of fungicides and SeedGrowth increased by 10.9% and 12% to €662 million and €252 million respectively. Herbicide business remains the largest category, with sales up 1.9% to €965 million, mainly benefited from the good development of products for use in cereals. Insecticide sales improved by 2.9% to €352 million.

Sales of Environmental Science advanced slightly by 1.2% to €166 million. This sales increase mainly came from a positive performance both by products for professional users and by the consumer business

EBIT of CropScience grew by 2.5% in the first quarter of 2014 to €988 million. Despite negative currency effects of €70 million, EBITDA before special items advanced by 1.6% to €1,098 million (currency effect approx. –6%). This earnings growth was mainly attributable to significantly increased volumes and higher selling prices. However, earnings were hampered by increases in both selling expenses and research and development expenses.

Regional sales

Europe remains the largest sale region, with sales sharply boosting 17.0% to €1,239 million. This growth resulted partly from the weather-related early start to the season. Fungicides,
Herbicides and Insecticides businesses developed especially well, all of them recording double-digit growth rates. The Seeds unit also posted significant gains, thanks to the successful sales development for vegetable seeds. Sales of Environmental Science moved slightly ahead.

Sales in North America achieved a 4.3% increase to €954 million in the first quarter of 2014, despite adverse weather conditions in large parts of this region. “The Seeds unit was particularly successful, especially with oilseed rape / canola and cotton seed. The Crop Protection and Environmental Science businesses also saw slight growth in sales. Substantial sales increases for the products of SeedGrowth unit more than offset the year-on-year decreases for Insecticides and Fungicides.” said the company.

Sales in the Asia / Pacific region were up by 8.2% to €329 million. “This increase was largely due to very good development of business in India, including products for use in rice. Fungicides and Insecticides units performed positively. Seeds business, especially for vegetables, was also successful in this region, as was Environmental Science business, particularly in Japan.” noted the company.

Sales in the Latin America / Africa / Middle East region improved by a significant 21.3% to €378 million. Business development in Crop Protection was primarily driven by the Insecticides and Fungicides units. The Seeds business achieved substantial growth, more than doubling sales of cotton seed. Environmental Science posted double-digit growth rates in a generally positive market environment.

Outlook

For 2014, Bayer continues to predict favorable market conditions for their CropScience business.The company expects to grow faster than the market and raise sales by a mid- to high-single-digit percentage on acurrency- and portfolio-adjusted basis. They anticipate negative currency effects of about 3% compared to 2013. Bayer expects to increase EBITDA before special items by a low-single-digit percentage, allowing for negative currency effects of approximately €150 million.