By Kim Richters

 

Bayer AG reported results for the second quarter on Tuesday. Here's what you need to know:

 

SALES: The German chemical and pharmaceutical conglomerate's quarterly sales came in at 10.05 billion euros ($11.81 billion), down from EUR10.71 billion year prior. Analysts expected sales of EUR10.40 billion, according to consensus estimates provided by Vara Research.

 

EBITDA BEFORE SPECIAL ITEMS: Earnings before interest, taxes, depreciation and amortization and before special items rose to EUR2.88 billion, compared with EUR2.73 billion in the same quarter the previous year and analysts' expectations of EUR2.74 billion.

 

NET INCOME: Bayer swung to a net loss of EUR9.55 billion due to special items for litigations, compared with a profit of EUR404 million a year earlier. Charges included costs for the Roundup cases as well as provisions for other litigations such as for the dicamba herbicide, the company said.

 

WHAT WE WATCHED:

 

--CORONAVIRUS HIT: Bayer's operational performance was slowed down by the coronavirus pandemic, analysts at Nord/LB said. The company's pharmaceuticals and consumer health divisions both experienced sales and adjusted Ebitda declines, missing consensus expectations provided by Vara.

 

--GUIDANCE ADJUSTMENTS: Bayer lowered its outlook for the year. It now expects sales to be between EUR43 billion and EUR44 billion and Ebitda before special items of around EUR12.1 billion, both on a currency-adjusted basis. Analysts at Warburg Research said the lower guidance doesn't surprise, but that "the current FX dynamics and their impact on Bayer's results force us to review our estimates."

 

--GLYPHOSATE LITIGATION: Bayer continues to expect total costs of up to $10.9 billion in settling lawsuits related to Roundup and resolving possible future litigations, saying it remains "strongly committed to a resolution that simultaneously addresses the current litigation on reasonable terms and provides a viable solution to manage and resolve potential future litigation."

 

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

 

(END) Dow Jones Newswires

August 04, 2020 07:52 ET (11:52 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.
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