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Bayer Q4 net profit down 67% on U.S. tax reform

Staff Writer |
Bayer said that its fourth-quarter net profit slumped, due largely to a hit from the U.S. tax reforms.

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Net profit for the quarter fell 67% to 148 million euros ($181.9 million) compared with EUR453 million a year earlier, while sales fell 2.6% on year to EUR8.60 billion, the company said.

A consensus forecast provided by FactSet had predicted net profit of EUR745 million and sales of EUR8.63 billion.

Bayer attributed the lower earnings to a EUR455 million tax hit from the U.S. fiscal reforms and ongoing difficulties with its Brazilian crop-science business.

Bayer said that its earnings before interest, taxes, depreciation and amortization before special items fell slightly to EUR1.78 billion, from EUR1.81 billion in the year-earlier period.

All of Bayer's four business units reported lower sales in the fourth quarter and all except pharmaceuticals posted lower operating profit, the company said.

The company said its net profit for the full year rose nearly 62% to EUR7.34 billion.

For 2018, the company expects sales and earnings at the prior-year level, despite likely currency losses. The forecast includes expected supply interruptions due to plant maintenance, which will cause a EUR300 million hit to adjusted Ebitda, Bayer said.

Adjusted for currency and scope effects, Bayer said it expects sales to increase by a "low- to mid-single-digit percentage."

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