Bayer continues positive business momentum

BayerThe Bayer Group continued its positive business momentum in the third quarter of 2013, with substantial contributions from the Life Science businesses HealthCare and CropScience. Reported sales of the Bayer Group were level year on year (minus 0.2 percent) at EUR 9,643 million (Q3 2012: EUR 9,661 million). Adjusted for currency and portfolio effects (Fx & portfolio adj.), sales grew by 6.0 percent. EBIT improved by a substantial 47.5 percent to EUR 1,221 million (Q3 2012: EUR 828 million) due in part to a drop in net special charges to EUR 99 million (Q3 2012: EUR 356 million). The special charges largely comprised expenses for restructuring and the integration of acquired businesses. EBIT before special items rose by 11.5 percent to EUR 1,320 million (Q3 2012: EUR 1,184 million). EBITDA before special items increased by 7.7 percent to EUR 1,984 million (Q3 2012: EUR 1,842 million) despite negative currency effects of about EUR 130 million. Net income advanced by 42.1 percent against the prior-year period to EUR 733 million (Q3 2012: EUR 516 million), while core earnings per share rose by 8.5 percent to EUR 1.27 (Q3 2012: EUR 1.17).

Gross cash flow moved ahead by 35.9 percent to EUR 1,367 million (Q3 2012: EUR 1,006 million), mainly as a result of the significant improvement in EBIT. Net cash flow fell by 13.0 percent to EUR 1,728 million (Q3 2012: EUR 1,986 million) because less working capital was released than in the prior-year quarter. Net financial debt declined from EUR 9.0 billion on June 30, 2013, to EUR 7.7 billion on September 30, 2013, largely as a result of cash inflows from operating activities.

New pharmaceutical products contribute more than EUR 400 million to HealthCare sales
Sales of the HealthCare subgroup increased by 0.5 percent (Fx & portfolio adj. 7.4 percent) in the third quarter to EUR 4,742 million (Q3 2012: EUR 4,717 million). "Our Pharmaceuticals business posted strong growth in all regions on a currency-adjusted basis," Dekkers commented. Sales of the Consumer Health segment also increased (Fx & portfolio adj.), mainly in the non-prescription medicines (Consumer Care) business and in the Emerging Markets.

The Pharmaceuticals business grew by 3.1 percent (Fx & portfolio adj. 10.6 percent) to EUR 2,818 million. This strong development was mainly driven by the new products - the anticoagulant Xarelto™, the eye medicine Eylea™, and the cancer drugs Stivarga™ and Xofigo™ - which posted combined sales of EUR 407 million (Q3 2012: EUR 82 million). Xarelto™ became the global leader in the new oral anticoagulants. Marketing of the pulmonary hypertension treatment Adempas™ (active ingredient: riociguat) began in September 2013, initially in Canada.

Among Bayer's established top pharmaceutical products, sales of the blood-clotting drug Kogenate™ increased by 14.5 percent on a currency-adjusted basis (Fx adj.), mainly due to shifts in order patterns. The cancer drug Nexavar™ also registered double-digit sales growth (Fx adj. 11.1 percent). Business with the multiple sclerosis drug Betaferon™/ Betaseron™ receded as expected, particularly in the United States, due to increased competition. Global sales of this product were down by 6.7 percent (Fx adj.). Sales of the YAZ™/Yasmin™/Yasminelle™ line of oral contraceptives were hampered by generic competition, especially in Western Europe, decreasing by 15.1 percent (Fx adj.) overall.

Sales in the Consumer Health segment came in at EUR 1,924 million (minus 3.1 percent). On a currency- and portfolio-adjusted basis, business expanded by 2.9 percent. Consumer Care registered strong growth particularly for the skincare product Bepanthen™/Bepanthol™ and the dietary supplement Supradyn™ (Fx adj. plus 29.6 percent and plus 19.8 percent, respectively). The Medical Care Division achieved currency- and portfolio-adjusted sales growth with contrast agents and medical devices (Radiology and Interventional). However, the Diabetes Care business was hampered above all by reimbursement pressure and price declines in the United States. The Animal Health Division benefited especially from the launch of the Seresto™ flea and tick collar in the United States. Sales of the Advantage™ line of flea, tick and worm control products were level with the prior-year period.

EBITDA before special items of the HealthCare subgroup rose by 4.6 percent to EUR 1,392 million (EUR 1,331 million). This improvement was the result of very good business development in Pharmaceuticals, whereas earnings of Consumer Health were slightly down. Negative currency effects diminished earnings of HealthCare by about EUR 100 million.

About Bayer HealthCare
The Bayer Group is a global enterprise with core competencies in the fields of health care, agriculture and high-tech materials. Bayer HealthCare, a subgroup of Bayer AG with annual sales of EUR 18.6 billion (2012), is one of the world's leading, innovative companies in the healthcare and medical products industry and is based in Leverkusen, Germany. The company combines the global activities of the Animal Health, Consumer Care, Medical Care and Pharmaceuticals divisions. Bayer HealthCare's aim is to discover, develop, manufacture and market products that will improve human and animal health worldwide. Bayer HealthCare has a global workforce of 54,900 employees (Dec 31, 2012) and is represented in more than 100 countries.

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