FRANKFURT—German pharmaceutical group Bayer AG Wednesday
reported a 21% rise in net profit for the second quarter of 2015,
boosted by favorable currency effects and earnings growth in all
three business areas.
Net profit for the period ended June 30 was €1.15 billion ($1.27
billion), compared with €953 million in the same period last year,
in line with analysts' expectations. Analysts had forecast a net
profit of €1.15 billion, according to a recent poll by The Wall
Street Journal.
Bayer's closely watched earnings before interest, taxes,
depreciation and amortization before special items climbed by 33.2%
to €2.9 billion, compared with €2.18 billion a year earlier.
Group sales rose by 18.2%, to €12.09 billion, compared with
€10.22 billion last year, driven by high sales in the company's
health care division. Sales at health care, which includes the
company's pharmaceuticals and over-the-counter units, jumped by 28%
to €5.9 billion.
The increase was "largely due to the gratifying sales
performance of our recently launched pharmaceutical products," said
Bayer Chief Executive Marijn Dekkers. Two of Bayer's five newest
drugs— blood thinner Xarelto and eye medicine Eylea—saw sales rise
by 42.6% and 49.1%, respectively, adjusted for currency
effects.
The health care division's sales were also boosted by Bayer's
recent $14.2 billion acquisition of U.S.-based Merck & Co.'s
over-the-counter business, which includes products such as Claritin
allergy medicine and Coppertone sunscreen.
Since taking the helm five years ago, Mr. Dekkers has worked to
streamline the company best known for its trademark Aspirin by
refocusing it on its core health care and agricultural businesses.
In addition to the launch of five recent blockbuster drugs and the
Merck OTC acquisition, Mr. Dekkers has also been preparing to spin
off the group's $10 billion specialty-plastics business, known as
MaterialScience, either directly to shareholders or through an
initial public offering.
Mr. Dekkers has said the company would decide on the best route
in the second half of 2015, but has suggested he would prefer an
initial public offering to generate cash to pay down Bayer's
approximately €20 billion in debt. The company said Wednesday that
preparations for the stock market flotation are "on schedule."
Ebitda before special items at MaterialScience rose by 87.4% to
€506 million, a result of improved demand and lower raw material
costs. Sales at the business stayed flat year-over-year, adjusted
for currency and portfolio effects.
Bayer's agricultural chemicals business, known as CropScience,
saw Ebitda before special items increase by 19.2%, again helped by
positive currency effects, even as sales, adjusted for currency and
portfolio effects, remained flat year-over-year.
The pharmaceutical firm revised its 2014 figures slightly, with
the exception of net profit and earnings per share, because its
diabetes care unit is now classified as a "discontinued business."
In June, the company announced plans to sell the unit for â,¬1
billion to Japan-based Panasonic Healthcare Holdings Co., Ltd.
However, second-quarter net profit and earnings-per-share figures
still reflected discontinued operations, the company said.
The company adjusted its guidance for 2015 as a result of the
change in exchange rates, as of June 30, and the discontinued
diabetes unit. Bayer now expects sales of around €47 billion for
the full year. It had previously forecast total annual sales of €48
billion to €49 billion. The group reiterated that it expects Ebitda
before special items for 2015 to increase by a high-teen percentage
point.
Write to Christopher Alessi at christopher.alessi@wsj.com
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