Bayer’s (BAYRY) earnings per share during the third quarter of 2011 came in at €1.12 (approx. $1.58) compared to €0.95 (approx. $1.22) in the year-ago period. Higher revenues boosted earnings. The emerging markets performed well during the quarter.
The company recorded a 1.0% growth in revenues, amounting to €8,670 million. Growth was approximately 4.8% on an adjusted basis. Growth was witnessed across the Material Science and Crop Science divisions at Bayer, driven primarily by increased volumes and selling prices.
The three major segments: Healthcare, Material Science and Crop Science accounted for approximately 48.4%, 31.9% and 15.9%, respectively, of total revenue during the reported quarter.
The Healthcare segment recorded revenues of €4,200 million in the third quarter of 2011, down 1.7% due to an adverse foreign currency impact. The HealthCare segment is divided further into two subgroups: Pharmaceuticals and Consumer Health.
The Pharmaceutical segment delivered flat year-over-year sales of €2,663 million. Sales of the segment were impressive in emerging markets such as China and Brazil. However, sales were weak in North America and Western Europe, mainly due to the adverse impact of healthcare reforms.
While products such as Aspirin Cardio, Nexavar and the Yaz family performed well during the quarter, Kogenate, Levitra and Betaferon’s performance was disappointing.
Sales at the Consumer Health segment amounted to €1,537 million, reflecting an increase of 3.8%. Growth in this subgroup, comprising Bayer’s OTC drug business for human beings and animals, was driven by impressive performances across all regions.
The Consumer Health subgroup is further divided into Consumer Care, Medical Care and Animal Health groups. Sales of the Consumer Care division climbed 5%. The Contour blood glucose meter system was responsible for the 3% growth of the Medical Care division.
However, sales of the Animal Health division were flat year-over-year. The impressive performances in the Asia-Pacific and Latin American markets were negated by weakness in the North American market. Performance of the Advantage product line at Bayer was hampered by adverse weather conditions.
Sales in the Material Science segment climbed 3.9% (7.4% on an adjusted basis) to €2,768 million in the reported quarter. Results were driven by increased selling prices.
Sales in the Crop Science division improved 2.8% (9.4% on an adjusted basis) to €1,379 million, mainly because of the impressive performance of the Crop Protection subgroup driven by seed treatments, fungicides and herbicides.
Bayer Backs 2011 View
Following the release of third quarter results, Bayer maintained its guidance for 2011. Bayer projects currency- and portfolio-adjusted sales growth in the range of 5-7% in 2011. The company continues to expect 2011 revenues in the range of €36 – €37 billion. Earnings are expected to increase by 15%.
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