Bayer (BAYN) Q4 2022 earnings summary

Executive summary

• FY22 sales rose 8.7% on a currency- and portfolio-adjusted basis to €50.739bn; EBITDA before special items increased 20.9% to €13.513bn, led by Crop Science.

• Core EPS advanced 22.0% to €7.94, while net income reached €4.150bn versus €1.000bn in FY21.

Financial highlights

• EBIT was €7.012bn, up 109.1%; EBIT before special items rose 26.9% to €9.257bn.

• FY22 free cash flow more than doubled to €3.111bn; Q4 net income was €611m, down 47.4%, and core EPS was €1.35, up 7.1%.

• Q4 sales increased 4.1% to €12.000bn; EBITDA before special items rose 2.8% to €2.462bn, while its margin fell to 20.5% from 21.5%.

Outlook and guidance

• FY23 currency- and portfolio-adjusted sales growth expected at 2–3%; currency-adjusted sales guidance is €51–52bn.

• FY23 currency-adjusted EBITDA before special items is forecast at €12.5–13.0bn, core EPS at €7.20–7.40, and free cash flow at ~€3.0bn.

• Year-end 2023 net financial debt forecast at €32–33bn; closing-rate sales guidance is €50–51bn.

• Divisional sales growth guidance: Crop Science ~3%, Pharmaceuticals ~1%, and Consumer Health ~5%; expected EBITDA margins are 25–26%, above 29%, and ~23%, respectively.

• Lower herbicide and established pharmaceutical prices, alongside continuing inflation-driven cost increases, are expected to weigh on FY23 earnings.