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Bayer CropScience
The Bayer CropScience subgroup again posted gratifying growth in the third quarter of 2008. Sales rose by 7.9 percent to €1,248 million (Q3 2007: €1,157 million). Adjusted for currency and portfolio changes, the increase came to 14.0 percent. Our CropScience business benefited from price levels for agricultural products that continued to be attractive to producers.
EBITDA before special items for the subgroup grew by 24.0 percent to €207 million (Q3 2007: €167 million), due especially to higher volumes and selling price increases for Crop Protection products. However, earnings were diminished by negative currency effects. EBIT before special items more than doubled to €78 million. Special charges for restructuring came to €42 million. EBITadvanced by 20.0 percent to €36 million.
EBITDA before special items for the subgroup grew by 24.0 percent to €207 million (Q3 2007: €167 million), due especially to higher volumes and selling price increases for Crop Protection products. However, earnings were diminished by negative currency effects. EBIT before special items more than doubled to €78 million. Special charges for restructuring came to €42 million. EBITadvanced by 20.0 percent to €36 million.
| Bayer CropScience | 3rd Quarter 2007 | 3rd Quarter 2008 | Change | First Nine Months 2007 | First Nine Months 2008 | Change |
| € million | € million | % | € million | € million | % | |
| Sales | 1,157 | 1,248 | +7.9 | 4,505 | 5,030 | +11.7 |
| Crop Protection | 985 | 1,067 | +8.3 | 3,681 | 4,215 | +14.5 |
| Environmental Science, BioScience | 172 | 181 | +5.2 | 824 | 815 | -1.1 |
| Sales by Region | ||||||
| Europe | 415 | 424 | +2.2 | 1,953 | 2,244 | +14.9 |
| North America | 206 | 213 | +3.4 | 1,083 | 1,122 | +3.6 |
| Asia/Pacific | 218 | 230 | +5.5 | 674 | 701 | +4.0 |
| Latin America/Africa/Middle East | 318 | 381 | +19.8 | 795 | 963 | +21.1 |
| EBITDA1 | 166 | 167 | +0.6 | 1,062 | 1,323 | +24.6 |
| Special items | (1) | (40) | (85) | (98) | ||
| EBITDA before special items2 | 167 | 207 | +24.0 | 1,147 | 1,421 | +23.9 |
| EBITDA margin before special items | 14.4% | 16.6% | 25.5% | 28.3% | ||
| EBIT1 | 30 | 36 | +20.0 | 649 | 927 | +42.8 |
| Special items | (4) | (42) | (94) | (104) | ||
| EBIT before special items2 | 34 | 78 | +129.4 | 743 | 1,031 | +38.8 |
| Gross cash flow1 | 149 | 167 | +12.1 | 777 | 1,033 | +32.9 |
| Net cash flow1 | 433 | 273 | -37.0 | 689 | 692 | +0.4 |
1 for definition see Bayer Group Key Data.
2 for definition see also Calculation of EBIT(DA) Before Special Items.
2 for definition see also Calculation of EBIT(DA) Before Special Items.
| Best-Selling Bayer CropScience Products* | 3rd Quarter 2007 | 3rd Quarter 2008 | Change | Currency- adjusted change | First Nine Months 2007 | First Nine Months 2008 | Change | Currency- adjusted change |
| € million | € million | % | % | € million | € million | % | % | |
| Confidor®/Gaucho®/ Admire®/Merit® (Insecticides/ Seed Treatment/ Environmental Science) | 157 | 199 | +26.8 | +32.6 | 452 | 489 | +8.2 | +16.0 |
| Flint®/Stratego®/ Sphere® (Fungicides) | 47 | 69 | +46.8 | +58.5 | 160 | 251 | +56.9 | +70.6 |
| Proline® (Fungicides) | 8 | 18 | +125.0 | +122.5 | 155 | 224 | +44.5 | +51.5 |
| Folicur®/Raxil® (Fungicides)/ Seed Treatment) | 48 | 50 | +4.2 | +8.6 | 186 | 208 | +11.8 | +16.8 |
| Basta®/Liberty®/ Rely® (Herbicides) | 28 | 24 | -14.3 | -5.2 | 189 | 195 | +3.2 | +9.1 |
| Puma® (Herbicides) | 22 | 24 | +9.1 | +16.9 | 160 | 174 | +8.8 | +14.7 |
| Poncho® (Seed Treatment) | 60 | 50 | -16.7 | -10.4 | 150 | 157 | +4.7 | +14.4 |
| Atlantis® (Herbicides) | 34 | 19 | -44.1 | -45.2 | 125 | 155 | +24.0 | +27.6 |
| Decis®/K-Othrine® (Insecticides/ Environmental Science) | 42 | 41 | -2.4 | +3.0 | 139 | 140 | +0.7 | +6.8 |
| Fandango® (Fungicides) | 12 | 15 | +25.0 | +32.1 | 54 | 110 | +103.7 | +109.2 |
| Total | 458 | 509 | +11.1 | +17.2 | 1,770 | 2,103 | +18.8 | +26.0 |
| Proportion of Bayer CropScience sales | 40% | 41% | 39% | 42% |
* Figures are based on active ingredient class. For the sake of clarity, only the principal brands and business units are listed.
Crop Protection
Sales of the Crop Protection segment expanded by 8.3 percent in the third quarter of 2008, to €1,067 million (Q3 2007: €985 million). On a currency-adjusted basis, business expanded by 14.7 percent. The market environment remained favorable and sales of all business units increased, with particularly strong growth recorded for our seed treatments, insecticides and fungicides.
In the Europe region, sales edged ahead by 0.8 percent to €371 million (Q3 2007: €368 million). Adjusted for currency effects, the increase was 1.1 percent. Our business with cereal and canola seed treatment products was especially successful. By contrast, sales of our herbicides were down substantially from the corresponding period of last year due to the somewhat later start to the fall season in western Europe.
Our crop protection business in North America expanded by 5.0 percent to €147 million. Adjusted for currency effects, the increase came to 17.2 percent. Business with our herbicides moved ahead significantly, with Liberty®/Rely® performed particularly well. The market introduction of Movento® and Belt® boosted insecticide sales. On the other hand, business with our seed treatment products, especially Poncho®, was down due to the delayed start to the season for these products.
Crop Protection sales in the Asia-Pacific region advanced by 6.8 percent to €203 million (Q3 2007: €190 million). Adjusted for shifts in exchange rates, business expanded by 16.2 percent. The tangible recovery in the agriculture sector in many parts of Australia following several years of drought provided a significant boost to sales of our herbicides and fungicides. In Japan, sales of our herbicides and insecticides improved, more than offsetting lower sales in China due to reduced insect infestation in rice.
Sales in our Latin America/Africa/Middle East region rose by 20.6 percent to €346 million (Q3 2007: €287 million). Adjusted for currency effects, the increase came to 29.8 percent. In Africa and the Middle East sales were down, while in Latin America we benefited from the positive market environment brought about by attractive prices for agricultural raw materials from the farmers’ perspective. As a result, sales increased significantly in all business units. We recorded particularly high growth rates for the Flint® family of fungicides, seed treatments for corn, and various insecticides for citrus fruits and corn.
In the Europe region, sales edged ahead by 0.8 percent to €371 million (Q3 2007: €368 million). Adjusted for currency effects, the increase was 1.1 percent. Our business with cereal and canola seed treatment products was especially successful. By contrast, sales of our herbicides were down substantially from the corresponding period of last year due to the somewhat later start to the fall season in western Europe.
Our crop protection business in North America expanded by 5.0 percent to €147 million. Adjusted for currency effects, the increase came to 17.2 percent. Business with our herbicides moved ahead significantly, with Liberty®/Rely® performed particularly well. The market introduction of Movento® and Belt® boosted insecticide sales. On the other hand, business with our seed treatment products, especially Poncho®, was down due to the delayed start to the season for these products.
Crop Protection sales in the Asia-Pacific region advanced by 6.8 percent to €203 million (Q3 2007: €190 million). Adjusted for shifts in exchange rates, business expanded by 16.2 percent. The tangible recovery in the agriculture sector in many parts of Australia following several years of drought provided a significant boost to sales of our herbicides and fungicides. In Japan, sales of our herbicides and insecticides improved, more than offsetting lower sales in China due to reduced insect infestation in rice.
Sales in our Latin America/Africa/Middle East region rose by 20.6 percent to €346 million (Q3 2007: €287 million). Adjusted for currency effects, the increase came to 29.8 percent. In Africa and the Middle East sales were down, while in Latin America we benefited from the positive market environment brought about by attractive prices for agricultural raw materials from the farmers’ perspective. As a result, sales increased significantly in all business units. We recorded particularly high growth rates for the Flint® family of fungicides, seed treatments for corn, and various insecticides for citrus fruits and corn.
| Crop Protection | 3rd Quarter 2007 | 3rd Quarter 2008 | Change | First Nine Months 2007 | First Nine Months 2008 | Change |
| € million | € million | % | € million | € million | % | |
| Sales | 985 | 1,067 | +8.3 | 3,681 | 4,215 | +14.5 |
| Herbicides | 306 | 307 | +0.3 | 1,353 | 1,492 | +10.3 |
| Fungicides | 194 | 210 | +8.2 | 963 | 1,234 | +28.1 |
| Insecticides | 281 | 311 | +10.7 | 905 | 954 | +5.4 |
| Seed Treatment | 204 | 239 | +17.2 | 460 | 535 | +16.3 |
| Sales by Region | ||||||
| Europe | 368 | 371 | +0.8 | 1,657 | 1,946 | +17.4 |
| North America | 140 | 147 | +5.0 | 751 | 806 | +7.3 |
| Asia/Pacific | 190 | 203 | +6.8 | 563 | 590 | +4.8 |
| Latin America/Africa/Middle East | 287 | 346 | +20.6 | 710 | 873 | +23.0 |
| EBITDA1 | 174 | 157 | -9.8 | 896 | 1,148 | +28.1 |
| Special items | (1) | (40) | (50) | (91) | ||
| EBITDA before special items2 | 175 | 197 | +12.6 | 946 | 1,239 | +31.0 |
| EBITDA margin before special items | 17.8% | 18.5% | 25.7% | 29.4% | ||
| EBIT1 | 56 | 46 | -17.9 | 540 | 813 | +50.6 |
| Special items | (4) | (42) | (59) | (97) | ||
| EBIT before special items2 | 60 | 88 | +46.7 | 599 | 910 | +51.9 |
| Gross cash flow1 | 149 | 151 | +1.3 | 650 | 892 | +37.2 |
| Net cash flow1 | 325 | 208 | -36.0 | 525 | 572 | +9.0 |
1 for definition see Bayer Group Key Data.
2 for definition see also Calculation of EBIT(DA) Before Special Items.
2 for definition see also Calculation of EBIT(DA) Before Special Items.
EBITDA before special items in the Crop Protection segment rose by 12.6 percent to €197 million (Q3 2007: €175 million). This earnings growth came mainly from higher volumes and selling price increases, which were partially offset by adverse currency effects. EBIT before special items came in at €88 million, up 46.7 percent from €60 million for the prior-year period. We took special charges of €42 million related to our cost structure program. EBIT came in at €46 million (Q3 2007: €56 million).
Sales of the Crop Protection segment in the first three quarters advanced by 14.5 percent to €4,215 million (9M 2007: €3,681 million). When adjusted for currency effects, the increase amounted to 20.8 percent. EBITDA before special items advanced by 31.0 percent to €1,239 million. EBIT before special items climbed by 51.9 percent to €910 million (9M 2007: €599 million). Our cost structure program led to special charges of €97 million. EBIT advanced by 50.6 percent to €813 million (9M 2007: €540 million).
Sales of the Crop Protection segment in the first three quarters advanced by 14.5 percent to €4,215 million (9M 2007: €3,681 million). When adjusted for currency effects, the increase amounted to 20.8 percent. EBITDA before special items advanced by 31.0 percent to €1,239 million. EBIT before special items climbed by 51.9 percent to €910 million (9M 2007: €599 million). Our cost structure program led to special charges of €97 million. EBIT advanced by 50.6 percent to €813 million (9M 2007: €540 million).
Environmental Science, BioScience
In the Environmental Science, BioScience segment, sales for the third-quarter of 2008 rose by 5.2 percent year-on-year to €181 million (Q3 2007: €172 million). Adjusted for currency and portfolio effects, business expanded by 10.5 percent.
Sales of the Environmental Science business unit improved by 1.6 percent to €129 million. Adjusted for currency effects, business was up 6.7 percent. In Europe, business with products for both professional users and consumers rose substantially from the same period of last year, more than offsetting a slight decline in sales in North America.
Sales of the BioScience business unit moved ahead 15.6 percent to €52 million. Adjusted for currency and portfolio effects, business was 21.2 percent ahead of the third quarter of 2007. This marked expansion was due especially to our vegetable seed business. The cotton seed business also turned in a pleasing performance.
Third-quarter EBITDA before special items in the Environmental Science, BioScience segment improved to €10 million (Q3 2007: minus €8 million). This was chiefly due to the growth in business. EBIT came in at minus €10 million (Q3 2007: minus €26 million).
Sales in the Environmental Science, BioScience segment in the first three quarters of 2008 decreased by 1.1 percent to €815 million (9M 2007: €824 million). Adjusted for currency and portfolio effects, however, business was up by 2.2 percent compared to the first nine months of 2007. EBITDA before special items dropped by 9.5 percent to €182 million. EBIT before special items fell by 16.0 percent to €121 million. After special charges of €7 million for our restructuring program, EBIT amounted to €114 million (9M 2007: €109 million).
Sales of the Environmental Science business unit improved by 1.6 percent to €129 million. Adjusted for currency effects, business was up 6.7 percent. In Europe, business with products for both professional users and consumers rose substantially from the same period of last year, more than offsetting a slight decline in sales in North America.
Sales of the BioScience business unit moved ahead 15.6 percent to €52 million. Adjusted for currency and portfolio effects, business was 21.2 percent ahead of the third quarter of 2007. This marked expansion was due especially to our vegetable seed business. The cotton seed business also turned in a pleasing performance.
Third-quarter EBITDA before special items in the Environmental Science, BioScience segment improved to €10 million (Q3 2007: minus €8 million). This was chiefly due to the growth in business. EBIT came in at minus €10 million (Q3 2007: minus €26 million).
Sales in the Environmental Science, BioScience segment in the first three quarters of 2008 decreased by 1.1 percent to €815 million (9M 2007: €824 million). Adjusted for currency and portfolio effects, however, business was up by 2.2 percent compared to the first nine months of 2007. EBITDA before special items dropped by 9.5 percent to €182 million. EBIT before special items fell by 16.0 percent to €121 million. After special charges of €7 million for our restructuring program, EBIT amounted to €114 million (9M 2007: €109 million).
| Environmental Science, BioScience | 3rd Quarter 2007 | 3rd Quarter 2008 | Change | First Nine Months 2007 | First Nine Months 2008 | Change |
| € million | € million | % | € million | € million | % | |
| Sales | 172 | 181 | +5.2 | 824 | 815 | -1.1 |
| Environmental Science | 127 | 129 | +1.6 | 515 | 459 | -10.9 |
| BioScience | 45 | 52 | +15.6 | 309 | 356 | +15.2 |
| Sales by Region | ||||||
| Europe | 47 | 53 | +12.8 | 296 | 298 | +0.7 |
| North America | 66 | 66 | 0.0 | 332 | 316 | -4.8 |
| Asia/Pacific | 28 | 27 | -3.6 | 111 | 111 | 0.0 |
| Latin America/Africa/Middle East | 31 | 35 | +12.9 | 85 | 90 | +5.9 |
| EBITDA1 | (8) | 10 | • | 166 | 175 | +5.4 |
| Special items | 0 | 0 | (35) | (7) | ||
| EBITDA before special items2 | (8) | 10 | • | 201 | 182 | -9.5 |
| EBITDA margin before special items | (4.7)% | 5.5% | 24.4% | 22.3% | ||
| EBIT1 | (26) | (10) | • | 109 | 114 | +4.6 |
| Special items | 0 | 0 | (35) | (7) | ||
| EBIT before special items2 | (26) | (10) | • | 144 | 121 | -16.0 |
| Gross cash flow1 | 0 | 16 | • | 127 | 141 | +11.0 |
| Net cash flow1 | 108 | 65 | -39.8 | 164 | 120 | -26.8 |
1 for definition see Bayer Group Key Data.
2 for definition see also Calculation of EBIT(DA) Before Special Items.
2 for definition see also Calculation of EBIT(DA) Before Special Items.
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