BAYN Bayer AG

By Kim Richters

German pharmaceutical and chemical giant Bayer reported results for its first quarter on Monday. Here's what you need to know:

SALES: Bayer said 1Q sales rose to 12.85 billion euros ($13.90 billion) from EUR12.25 billion, beating analysts' expectations of EUR12.61 billion, according to a consensus provided by Vara Research.

EBITDA BEFORE SPECIAL ITEMS: Ebitda before special items rose 10.2% to EUR4.39 billion from EUR3.98 billion in the same quarter the previous year. Analysts had expected EUR4.10 billion for the quarter, according to Vara Research.

NET INCOME: Net profit jumped 20% to EUR1.49 billion from EUR1.24 billion a year earlier.

"1Q 2020 was generally very strong for Bayer in all divisions," said Bryan Garnier.

WHAT WE WATCHED:

-PHARMA DIVISION: Bayer's pharmaceuticals business benefited from coronavirus-related stock piling for some products like Xarelto, while others like Eylea were negatively affected by the pandemic, says Bryan Garnier. "In all, Pharmaceuticals were more or less in line with expectations and do not warrant specific comments. We continue to believe that the lack of a strong pipeline will be an issue for Bayer," says the investment bank.

-GUIDANCE: The company maintained its targets for 2020, which don't include coronavirus effects, and said it wasn't possible to reliably assess "the positive and negative effects until later in the year."

"In our view, the strong start to the year is positive and reflects that Bayer is on track to deliver on its underlying targets," says Warburg Research.

-CROP SCIENCE/GLYPHOSATE: Bayer's crop-science segment had a strong quarter, benefiting from the coronavirus pandemic and from increased demand compared with a year earlier, says Bryan Garnier.

As for the Roundup litigation, the company reported a rise in plaintiffs to around 52,500 as of April 14 and said the related mediation process "significantly slowed" due to the coronavirus pandemic.

Write to Kim Richters at kim.richters@wsj.com

(END) Dow Jones Newswires

April 27, 2020 07:02 ET (11:02 GMT)

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