Bayer AG trimmed its profit and sales estimates for the year, blaming a stumble in agriculture, even as the German conglomerate doubles down on crop chemicals with the $66 billion acquisition of Monsanto Co.
Earnings before interest, taxes, depreciation and amortization and other special costs will probably rise by a percentage in the high single-digits this year while sales grow more slowly, the Leverkusen, Germany-based company said July 27 in a statement. Ebitda was previously expected to rise by a percentage in the low teens.
Bayer is forging ahead with the Monsanto takeover and paring its holding in Covestro AG, its former plastics unit, as Chief Executive Officer Werner Baumann reshapes the company around health and agriculture. The company’s prescription drugs business has helped offset stutters at its other units, even as the Monsanto deal has raised questions about whether the conglomerate has reserved enough resources to compete for plum pharmaceutical assets.
The stock fell as much as 4.1 percent to 107.20 euros in Frankfurt trading, the lowest level in more than three months. Bayer pointed to an inventory adjustment in Brazil and a challenging environment for consumer health business in the U.S. for the weakened outlook.
Source: www.agprofessional.com