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Bayer AG (BAYRY) Q4 2024 Earnings Call Highlights: Navigating Growth and Challenges

In This Article:

  • Net Sales Growth: 1% increase on a currency and portfolio-adjusted basis for 2024.

  • EBITDA Before Special Items: EUR 10.1 billion, 14% below the prior year.

  • Net Debt: Reduced to EUR 32.6 billion by the end of 2024.

  • Free Cash Flow: EUR 3.1 billion, ahead of guidance.

  • Core Earnings Per Share: EUR 5.05, below the prior year.

  • Reported Earnings Per Share: Minus EUR 2.60, impacted by impairment losses.

  • Pharmaceuticals Sales Growth: 3.3% increase on a currency and portfolio-adjusted basis.

  • Pharmaceuticals EBITDA Margin: 26% for 2024.

  • Consumer Health Sales Growth: 1.9% year over year.

  • Consumer Health EBITDA Margin: 23.3%, in line with last year.

  • Crop Science Sales Decline: 2% decrease, with an EBITDA margin of 19.4%.

  • 2025 Net Sales Outlook: EUR 45 billion to EUR 47 billion.

  • 2025 EBITDA Before Special Items Outlook: EUR 9.5 billion to EUR 10 billion.

  • 2025 Free Cash Flow Outlook: EUR 1.5 billion to EUR 2.5 billion.

  • 2025 Core Earnings Per Share Outlook: EUR 4.50 to EUR 5.

Release Date: March 05, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Bayer AG (BAYRY) achieved a slight growth in net sales by 1% in 2024, driven by strong performance in pharmaceuticals and consumer health.

  • The pharmaceuticals division exceeded expectations with significant growth in flagship products NUBEQA and KERENDIA, reaching EUR 2 billion in sales.

  • The company successfully reduced its net debt to EUR 32.6 billion, reflecting a strong commitment to debt reduction.

  • Bayer AG (BAYRY) completed nine positive Phase 3 trials and advanced over 20 clinical programs, indicating a robust pipeline for future growth.

  • The consumer health division maintained a solid EBITDA margin of 23.3% despite currency headwinds, showcasing operational efficiency.

Negative Points

  • The crop science division faced challenges with a 4% decline in sales due to pricing pressures from generics and regulatory hurdles.

  • Bayer AG (BAYRY) anticipates a difficult financial performance in 2025, with net sales expected to be roughly in line with 2024 and earnings behind prior year.

  • The loss of the Xarelto patent is expected to accelerate, leading to a decline in pharmaceutical sales and margins.

  • The company faces ongoing litigation challenges, particularly related to glyphosate, which could impact financial performance.

  • Foreign exchange headwinds significantly impacted the company's EBITDA, reducing it by almost EUR 600 million in 2024.

Q & A Highlights

Q: Can you provide an update on the Asundexian Phase 3 trial and its market potential? A: Stefan Oelrich, Head of the Pharmaceuticals Division, confirmed that the Asundexian Phase 3 trial is on track, with data expected in the second half of the year. The market potential depends on the trial's outcome and competition, but it could be a blockbuster if successful.