The Bayer Group started the year 2014 with encouraging growth in sales and earnings. "Our Life Science businesses continued their dynamic development and achieved slight earnings increases despite significant negative currency effects," Bayer CEO Dr. Marijn Dekkers said on Monday when the interim report was published. HealthCare experienced strong growth thanks to the gratifying development in sales of the recently launched pharmaceutical products. CropScience benefited from an early start to the season in Europe. MaterialScience, in particular, raised earnings substantially. "We are confident about our business development for the rest of the year and confirm our guidance for 2014," said Dekkers.
Sales of the Bayer Group advanced by 2.8 percent in the first quarter of 2014 to EUR 10,555 million (Q1 2013: EUR 10,266 million). Adjusted for currency and portfolio effects (Fx & portfolio adj.), business expanded by 8.4 percent. EBIT rose by 18.4 percent to EUR 2,096 million (Q1 2013: EUR 1,771 million) after net special items of plus EUR 7 million (Q1 2013: minus EUR 45 million). EBIT before special items increased by 15.0 percent to EUR 2,089 million (Q1 2013: EUR 1,816 million). In spite of negative currency effects of some EUR 200 million or roughly 8 percent, EBITDA before special items improved by 11.6 percent to EUR 2,738 million (Q1 2013: EUR 2,453 million). Net income climbed by 22.7 percent to EUR 1,423 million (Q1 2013: EUR 1,160 million) and core earnings per share by 14.7 percent to EUR 1.95 (Q1 2013: EUR 1.70).
Gross cash flow in the first quarter of 2014 rose by 13.3 percent to EUR 2,048 million (Q1 2013: EUR 1,807 million) due to the improvement in EBITDA. Net cash flow, however, declined to EUR 163 million (Q1 2013: EUR 327 million) because more cash was tied up in working capital. Net financial debt rose from EUR 6.7 billion on December 31, 2013, to EUR 9.1 billion on March 31, 2014. This increase was driven by the acquisition of Algeta ASA, Norway.
HealthCare: recently launched pharmaceutical products post sales of some EUR 600 million Sales of the HealthCare subgroup rose by 2.9 percent (Fx & portfolio adj. 8.9 percent) in the first quarter to EUR 4,572 million (Q1 2013: EUR 4,443 million). "This growth was driven by the pharmaceutical products we have launched recently," said Dekkers. Sales showed above-average development in the Emerging Markets.
The Pharmaceuticals business recorded strong growth compared to a weaker prior-year quarter, with sales rising by 14.9 percent (Fx & portfolio adj.) to EUR 2,782 million. This excellent performance was driven by the recently launched medicines Xarelto, Eylea, Stivarga, Xofigo and Adempas, which registered combined sales of EUR 598 million (Q1 2013: EUR 244 million) led by the anticoagulant Xarelto, which is Bayer's best-selling pharmaceutical product.