Leverkusen, August 8, 2023 – Bayer published detailed results for the second quarter of 2023 on Tuesday, after having already communicated key figures for the three-month period and lowering its outlook for full-year 2023 in a July 24 news release. The revised guidance was mainly due to a significant further decline in sales of glyphosate-based products at the Crop Science Division. Sales at Pharmaceuticals were stable on a currency- and portfolio-adjusted basis (Fx & portfolio adj.), while earnings were down year on year. Consumer Health registered higher sales (Fx & portfolio adj.) and also increased earnings.
Group sales declined by 8.2 percent (Fx & portfolio adj.) to 11.044 billion euros in the second quarter. There was a negative currency effect of 553 million euros (Q2 2022: positive currency effect of 915 million euros). EBITDA before special items declined by 24.5 percent to 2.527 billion euros. This figure included a negative currency effect of 120 million euros (Q2 2022: positive currency effect of 300 million euros). By contrast, the company registered income across all divisions totaling around 481 million euros due to a decrease in provisions for the Group-wide Short-Term Incentive program. EBIT came in at minus 956 million euros (Q2 2022: plus 169 million euros) after net special charges of 2.490 billion euros (Q2 2022: 2.111 billion euros) that primarily related to unscheduled impairment testing in the Crop Science Division. As a result, net income came in at minus 1.887 billion euros (Q2 2022: minus 298 million euros). Core earnings per share decreased by 36.8 percent to 1.22 euros.
Free cash flow amounted to minus 473 million euros (Q2 2022: plus 1.140 billion euros), primarily due to the decline in business at the Crop Science Division. At 39.620 billion euros, net financial debt as of June 30, 2023, was 9.8 percent higher than at the end of March 2023.
Crop Science sales without glyphosate at prior-year level (Fx & portfolio adj.)
Sales in the agricultural business (Crop Science) fell by 18.5 percent (Fx & portfolio adj.) to 4.924 billion euros, mainly driven by lower volumes and prices for glyphosate-based products. This effect particularly impacted business in North and Latin America as well as in Europe/Middle East/Africa, and resulted in a 45.6 percent decrease in sales (Fx & portfolio adj.) at Herbicides. Excluding the glyphosate business, Crop Science sales were level with the previous year (Fx & portfolio adj.), as higher prices were offset by lower volumes. Sales at Corn Seed & Traits rose by 10.6 percent (Fx & portfolio adj.), largely thanks to higher prices in all regions as well as increased acreages in North America. Business at Fungicides was level with the prior-year quarter (Fx & portfolio adj.). Sales at Soybean Seed & Traits were down 9.3 percent (Fx & portfolio adj.), mainly due to decreased acreages and a decline in license revenues in North America.
EBITDA before special items at Crop Science fell by 58.5 percent to 725 million euros, primarily due to the decline in sales of glyphosate-based products. Higher prices in the rest of the business and cost savings only partially compensated for this effect. Earnings were also diminished by a mainly inflation-related increase in the cost of goods sold and a negative currency effect of 96 million euros (Q2 2022: positive currency effect of 215 million euros).
Pharmaceuticals: new products deliver substantial growth
Sales of prescription medicines (Pharmaceuticals) came in at 4.557 billion euros, matching the prior-year level on a currency- and portfolio-adjusted basis. The division’s new products achieved significant gains: Sales of the cancer drug Nubeqa™ nearly doubled, while Kerendia™ for the treatment of chronic kidney disease associated with type 2 diabetes saw business expand more than threefold. In addition, the Radiology business continued to grow, mainly driven by gains for the CT Fluid Delivery and Ultravist™ product families. Sales of the ophthalmology drug Eylea™ also increased, with growth of 5.6 percent (Fx