February 29, 2012

Bayer AG Tuesday (Feb 28) lowered its 2012 outlook after it missed fourth-quarter revenue forecasts, weighed by a weaker-than-expected Material Science division.

"Overall business development in the fourth quarter showed a mixed picture," said Chief Financial Officer Werner Baumann, adding that while HealthCare and CropScience segments had modest sales gains on an adjusted basis, the Material Science business was at par with the fourth quarter a year earlier.

Bayer reported fourth-quarter net profit of EUR397 million (US$535 million), compared to a loss of EUR145 million (US$195 million) a year earlier. Last year's results were hit by higher-than-expected exceptional charges that included the ending of some drug research projects and removal of its Schering brand name.

Analysts polled by Dow Jones Newswires expected a profit of EUR450 million (US$607 million) in this quarter. Sales rose 1.9% in currency and portfolio-adjusted terms to EUR9.19 billion (US$12.39 billion), above forecasts of EUR9.07 billion (US$12.22 billion).

Earnings before interest, taxes, depreciation and amortization before special items fell 8.8% to EUR1.54 billion (US$2.08 billion), missing analysts expectations of EUR1.61 billion (US$2.17 billion).

For 2012, the company expects adjusted sales growth of about 3%, with a slight improvement in Ebitda before special items as well as core earnings per share, a measure of profitability that excludes non-cash expenses and other items. On a currency-adjusted basis, the company expects sales of around EUR37 billion (US$50 billion).

Last year, the company had said it expects 2012 adjusted sales to grow by about 5%, with Ebitda before special items of about EUR8 billion (US$10.8 billion) and core earnings per share of around EUR5 (US$6.74).