Bayer delivers robust performance - Crop Science registers higher sales thanks to growth in Latin America and Asia/Pacific

The Bayer Group delivered robust operational performance in 2020. “Our operational strength in these turbulent times shows just how resilient our businesses are, even during the pandemic,” said Werner Baumann, Chairman of the Board of Management, on Thursday during the company’s Financial News Conference. “We also used the past year to lay the foundation for future growth. We continued to drive forward our company’s transformation, advanced our product pipelines and invested in new technologies across all our business units,” Baumann said. For 2021, Bayer expects to achieve solid operational growth and stable earnings at constant currencies.

In the agricultural business (Crop Science), Bayer increased sales by 1.3 percent (Fx & portfolio adj.) to 18.840 billion euros. The businesses in the Latin America and Asia/Pacific regions contributed to the increase, while declines occurred particularly in North America.

Sales growth was particularly strong at Fungicides (Fx & portfolio adj. 8.5 percent) and Environmental Science (Fx & portfolio adj. 11.5 percent), with these businesses expanding in all regions. At Fungicides, Bayer posted sales gains in Latin America thanks to Fox Xpro™, which was launched in 2019.

Sales also rose at Soybean Seed & Traits (Fx & portfolio adj. 2.3 percent). Greater market penetration in Latin America had a positive effect, while business in North America saw lower selling prices and volumes, mainly due to increased competition. At Corn Seed & Traits, sales remained at the prior-year level (Fx & portfolio adj. minus 0.5 percent). In North America, shifts in demand into 2019 and 2021 had a negative impact, while sales moved ahead in all the other regions.

Sales at Herbicides declined by 1.0 percent (Fx & portfolio adj.), particularly because the company lost registrations – in some cases only temporarily – in the Europe/Middle East/Africa and North America regions.

EBITDA before special items at Crop Science decreased by 3.8 percent to 4.536 billion euros. Business was particularly impacted by negative currency effects of 537 million euros, while the decline in sales in North America due to shifts in demand was also a key factor. By contrast, earnings benefited from the realization of cost synergies as the company progresses with the integration of the acquired business.

As regards the glyphosate litigation in the United States, the company announced in early February 2021 that it had reached an agreement with plaintiffs' counsel on a class plan intended to manage and resolve future Roundup™ cases, and plaintiffs' counsel filed a motion for preliminary approval of the class agreement. Both parties have worked diligently to address questions the court raised after their first settlement proposal for future Roundup™ cases last summer.

The new agreement is now subject to court approval. The class plan is intended to be one part of a holistic solution designed to provide further closure to the Monsanto Roundup™ litigation. Approximately 90,000 current claims in the Roundup™ litigation overall are covered by settlement agreements, or did not meet the settlement program eligibility criteria. The company continues to negotiate with plaintiffs’ counsel to reach agreements in the remainder of current cases.

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