Thursday February 28, 10:36 AM
Bayer posts record 2007 results on pharma, agrochemical activities
LEVERKUSEN, Germany (AFP) - German group Bayer (Xetra: 575200 - news) said on Thursday that 2007 was a record year thanks to its pharmaceutical and agro-chemicals activities.
Net profit almost tripled to 4.7 billion euros (7.1 billion dollars) and operating profit before exceptional items, Bayer's benchmark for forecasts, rose by 21 percent to 6.8 billion euros, a statement said.
Sales gained 12 percent to 32.4 billion euros, while the company's profit margin reached 20.9 percent.
The maker of Aspirin thus attained its targets of a profit margin of at least 20.3 percent and sales of more than 32 billion euros.
In the fourth quarter of 2007 however, Bayer's net profit fell by 80 percent to 67 million euros, mainly because the same period in 2006 had benefitted from the effect of a German tax reform.
Operating profit before exceptional items, which measures the company's core activities, gained 13 percent to 1.4 billion euros in the quarter, below a forecast by analysts compiled by Thomson Financial News.
For the full year, Bayer saw solid growth in two of its key divisions.
Healthcare posted a 26 percent jump in sales to 14.8 billion euros following the acquisition of the German group Schering in 2006.
Chemical products for agriculture also provided strong results, particularly in Latin America, with Bayer's Cropscience division increasing sales by 5.6 percent to 5.8 billion euros.
The Material Science unit, which makes plastics and is being restructured, showed a 4.2 percent loss in core earnings to 1.6 billion euros.
On Tuesday, Bayer had already announced it would propose a 35 percent increase in its share dividend to 1.35 euros.
For 2008, the group is targetting a five percent increase in sales, when corrected for foreign exchange variations.
Bayer expects to be able to improve its core earnings and profit margin, a statement quoted chief executive Werner Wenning as saying.
"The strong start to the year confirms our estimations," Wenning said.
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