Bayer (BAYN) Investor update summary

Strategic framework and financial targets

• Five-Year Framework targets €3.5 billion in top-line growth, mid-20s EBITDA margin, and €1.5 billion cumulative cash generation by 2029, driven by innovation and operational efficiency.

• Margin improvements of over €1 billion are targeted, with €380 million already delivered, mainly from product supply and sourcing initiatives.

• Cash productivity is ahead of schedule, with €500 million inventory reduction in 2025 and a goal of over €3 billion free operating cash flow by 2029.

• Net sales are expected to grow at a 3% CAGR through 2029, outpacing the ~2% market growth, with corn and other seeds & traits as main growth drivers.

• Licensing revenues remain robust, with over €2 billion net annually expected until 2030, underpinned by technology leadership and multi-decade agreements.

Operational execution and cost transformation

• Product supply improvements focus on sourcing, network optimization, and seed production, targeting €600 million in EBITDA impact by 2029.

• Nearly €400 million in cost reductions and €500 million in inventory reductions have been achieved, with further portfolio pruning and R&D restructuring underway.

• Active ingredient production is being shifted from Europe to more cost-competitive regions, mainly China and India, to address global overcapacity and energy price pressures.

• Go-to-market and SG&A cost reductions are being achieved through country archetype segmentation, digitalization, and functional productivity programs.

• Working capital productivity is being enhanced through inventory, payables, and receivables management, supporting cash flow targets.

Innovation pipeline and growth drivers

• Commercialization of two blockbuster products has begun, with more launches planned, targeting at least 10 blockbusters in a decade, each with peak sales potential of €500 million or more.

• Corn is the main growth engine, with double-digit growth, geographic expansion, and the Preceon Smart Corn System expected to drive a 4 percentage point market share gain by 2035.

• Soybean is stabilizing, with major growth expected post-2028 from Vyconic and Intacta 5+ launches, which are expected to exceed €3 billion in peak sales.

• Core Crop Protection focuses on profitable growth via blockbuster launches (Plenexos, Icafolin), lifecycle management, and portfolio optimization.

• Non-Core Crop Protection (glyphosate/Ruveon) is managed as a lean, commodity-focused business, with profitability prioritized over top-line growth.