EBITDA before special items at Crop Science decreased by 14.2 percent to 4.325 billion euros, mainly due to significant price declines in the crop protection business.
The Bayer Group achieved its adjusted guidance for 2024. “We have three great businesses, with attractive long-term prospects,” CEO Bill Anderson said at the Financial News Conference. Sales at Crop Science decreased by 2.0 percent (Fx & portfolio adj.) to 22.259 billion euros. Business was primarily impacted by lower prices in the crop protection business driven by competitive pricing pressure. Lower volumes in seeds and traits due to lower planted area were offset by volume growth in crop protection. Sales in Latin America were down due to lower planted corn area and reduced crop protection prices. By contrast, North America delivered slightly higher sales driven by higher crop protection volumes and soybean planted area, partially offset by lower corn planted area.
EBITDA before special items at Crop Science decreased by 14.2 percent to 4.325 billion euros, mainly due to significant price declines in the crop protection business. Earnings were also impacted by higher provisions for the Group-wide short-term incentive (STI) program as well as inflationary cost increases, whereas the cost of goods sold improved due to efficiencies, especially for crop protection products. There was also a positive currency effect of 37 million euros (2023: 103 million euros). The EBITDA margin before special items declined by 2.3 percentage points to 19.4 percent.
The plan to boost profitability at Crop Science centres around key measures regarding the product portfolio, research and development, production, commercial and enabling functions, totalling more than one billion euros in annual earnings contributions by 2029. It also includes a far-reaching cash productivity program. Bayer is targeting above-market growth for Crop Science during the coming years, with more than 3.5 billion euros of incremental sales from innovation by 2029. By the same year, the division is targeting an EBITDA margin before special items in the mid-20s percentage. “We recognise the need to take action, our team has a plan, and they’ve got what it takes to deliver,” Bill Anderson said.
