Bayer Stock Up On Growth View Starting FY26, Despite Q4 Loss, Cautious FY25

(RTTNews) - Shares of Bayer AG were gaining around 6 percent in the German trading after the pharmaceutical and life sciences major Wednesday said it expects improved performance from 2026 onwards, despite reporting a slip to loss in its fourth quarter. The company also projects weak core earnings and nearly flat sales for fiscal 2025.

Further, the company said it will propose an unchanged dividend of 0.11 euros per share at the Annual Stockholders' Meeting on April 25.

Calling 2025 a pivotal year for the company's turnaround, CEO Bill Anderson said, "It is the second year in Bayer's turnaround and will be the most difficult in terms of financial performance, with net sales roughly in line with and earnings and free cash flow behind the prior year. The company expects improved performance from 2026 onwards. Alongside its four existing strategic priorities, the company is adding profitability at Crop Science as a fifth focus area, coupled with the launch of a comprehensive, five-year plan to improve earnings."

The Pharmaceuticals Division is projected to return to sales growth from 2027 onwards and expand margins beginning in 2028.

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.

The company further said it is well on track to achieve its three "100 million" targets by 2030, which involve supporting smallholder farmers and providing access to modern contraception as well as self-care products.

Looking ahead, for fiscal 2025, Bayer projects core earnings per share and adjusted EBITDA to decline, and sales roughly at prior-year level.

At Group level, the company expects to post core earnings per share of 4.25 to 4.75 euros and adjusted EBITDA of 9.3 billion to 9.8 billion euros.

On a currency-adjusted basis, the company anticipates core earnings per share of 4.50 to 5.00 euros and adjusted EBITDA of 9.5 billion to 10.0 billion euros.

Bayer expects to generate sales of 45 billion euros to 47 billion euros in 2025, corresponding to a change of minus 3 to plus 1 percent on a currency- and portfolio-adjusted basis.

In fiscal 2024, core earnings per share were 5.05 euros, adjusted EBITDA was 10.12 billion euros, and sales were 46.61 billion euros.

For the fourth quarter, net loss was 335 million euros, compared to prior year's net income of 1.34 billion euros. Loss per share was 0.34 euro, compared to earnings of 1.36 euros a year ago.

Core earnings per share were 1.05 euros, compared to prior year's 1.85 euros.

Adjusted EBITDA fell 22.3 percent from last year to 2.35 billion euros, and adjusted EBITDA margin declined to 20 percent from 25.5 percent last year.

Sales for the quarter were 11.729 billion euros, down 1.1 percent from 11.862 billion euros in the prior year. On an adjusted basis, sales edged up 0.1 percent.

In Germany, Bayer shares were trading at 25.15 euros, up 6.91 percent.

For more earnings news, earnings calendar, and earnings for stocks, visit rttnews.com.