After the luxury goods and automotive sectors faced turmoil, European pharmaceutical and chemical giants have also been affected | Financial Report Insights
Bayer reported a net loss of nearly 4.2 billion euros in the third quarter, and due to weak performance in its pesticide business, Bayer lowered its full-year profit guidance. On Tuesday, Bayer's European stock briefly plummeted by 12%
Following the turmoil in the luxury goods and automotive industries, the European pharmaceutical and chemical sector is also facing severe challenges. Due to a weak agricultural market, German pharmaceutical and chemical giant Bayer has lowered its fiscal year operating profit forecast, with its stock price dropping by as much as 12%.
On November 12, Bayer announced that its third-quarter financial results fell short of expectations.
Key Financial Data:
Revenue: The company's third-quarter revenue was €9.97 billion (USD 10.586 billion), a year-on-year decrease of 3.6%.
Net Profit: Due to the impairment of intangible assets in the Crop Science division, the company recorded a special expense of €4.1 billion, resulting in a net loss of €4.18 billion for the third quarter, compared to a loss of €4.57 billion in the same period last year.
EBITDA: Due to the weakness in the agricultural market in Latin America, the adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the third quarter fell nearly 26% to €1.25 billion, below analysts' expectations of €1.31 billion.
The company expects that the full-year adjusted EBITDA will be between €10.4 billion and €10.7 billion, a decrease from the previous forecast of €10.7 billion to €11.3 billion.
Bayer stated that it holds a cautious outlook for the agricultural market environment in 2025, while its pharmaceutical business is expected to reach the upper limit of its guidance in 2024. Bayer also mentioned that the company is facing price pressures in crop protection and has recorded impairments of several billion euros in the Latin American agricultural market.
Meanwhile, the company's domestic competitor BASF reported last month that its agricultural division experienced a significant decline in earnings due to falling prices and weak foreign currencies. Its U.S. agricultural chemicals competitor Corteva also reported last week that losses exceeded expectations, leading the company to lower its full-year sales forecast due to price declines.
As of now, Bayer's stock price in Europe has dropped by 11.69%.
