Bayer Group reports mixed Q3 results, lowers crop science outlook

Weak Latin American market and pricing pressures lead to sales decline in agricultural business.

November 12, 2024

Bayer Group's third-quarter results for 2024 reveal significant challenges in its agricultural business, prompting a downward revision of the Crop Science division's outlook for the year. The company reported a 3.6% decrease in Crop Science sales, reflecting the broader struggles in the global agricultural market.

Key points from Bayer's agricultural business performance:

Sales in the Crop Science division fell to 3.986 billion euros, primarily due to weaknesses in the Latin American market.
Glyphosate-based herbicide sales plummeted by 19.1% as purchasing patterns normalized and volumes decreased.
The Corn Seed & Traits business saw a similar decline of 19.3%, attributed to significant acreage reduction for corn in Latin America.
Despite these setbacks, fungicide and insecticide sales showed strong growth, with increases of 13.1% and 9.5% respectively.
EBITDA before special items for Crop Science improved slightly to 35 million euros, up from a loss of 24 million euros in Q3 2023.

Bayer CEO Bill Anderson acknowledged the challenges, stating, "The development of the agricultural market has been weaker than anticipated, especially in Latin America, and we continue to face pricing pressure in the crop protection business."

In response to these trends, Bayer has revised its 2024 guidance for the Crop Science division:

Currency- and portfolio-adjusted sales growth is now expected to be between -3% and -1%, down from the previous forecast of -1% to +3%.
The EBITDA margin before special items is projected to be between 18% and 20%, lower than the earlier estimate of 20% to 22%.

Looking ahead to 2025, Bayer remains cautious about the agricultural market environment, citing additional regulatory challenges and generic pricing pressures that are expected to impact the crop protection business further.

Despite these headwinds in agriculture, Bayer maintains its overall 2024 Group guidance for currency- and portfolio-adjusted sales growth, emphasizing its commitment to addressing challenges through cost and efficiency measures while focusing on cash conversion.