BERLIN, May 3 (Xinhua) -- German chemicals manufacturer Bayer has lowered its financial outlook for 2018 in reaction to unexpectedly weak earnings during the first quarter (Q1) of the year, the company told press on Thursday.
Bayer recorded a decline in Q1 revenue by 5.6 percent to 9.14 billion euros (10.96 billion U.S. dollars) while operating profits fell by around five percent to 2.9 billion euros during the same period. As a consequence, the Leverkusen-based company now also expects to experience a slight decline in annual revenue, as well as annual earnings before interest, taxes, depreciation and amortization (EBIDTA) in 2018.
Earlier, the Dax-listed company had informed shareholders that it expected to at least maintain the levels of revenue and EBIDTA achieved in 2017 throughout the current year.
Bayer explained on Thursday that the deterioration in its financial position was mainly due to adverse currency effects. Resulting higher costs associated with production, research, development, marketing and sales weighed on the company's performance across diverse divisions.
The company's business with pharmaceuticals, prescription free health products and agrochemicals were all considerably weaker in Q1 2018 compared to the same period last year. The pharmaceuticals unit hereby witnessed its first quarterly decline in nearly four years.
In spite of the disappointing quarterly earnings figures, chief executive officer (CEO) Werner Baumann said that his company was progressing successfully towards the achievement of its larger strategic goals. According to Baumann, Bayer had made "good progress" in the widely-publicized acquisition of U.S. agrochemical company Monsanto for 62.5 billion euros.
The CEO expressed confidence that the regulatory approval of U.S. antitrust authorities for the deal would be obtained shortly, enabling Bayer to finalize the merger with Monsanto by the end of the second quarter (Q2) of 2018. European Union (EU) competition authorities have recently given the greenlight to Bayer's sale of its own crop science unit to German chemical industry rival BASF, removing one significant potential obstacle to the conclusion of the Monsanto takeover.
Founded in 1863, Bayer is one of the world's largest chemicals manufacturers and employs over 99,000 staff across the world. The publicly-listed company recorded annual gross revenue of 35 billion euros in 2017.(1 euro = 1.20 U.S. dollars)
