BERLIN, July 30 (Xinhua) -- Turnover of German agrochemical giant Bayer increased by 0.9 percent to a total of 11.5 billion euros (12.8 billion U.S. dollars) while operational profits (EBITDA) increased by nearly a quarter to 2.9 billion euros in the second quarter of 2019 (Q2), the company announced on Tuesday.
Bayer's Crop Science division recorded a reported increase in turnover of 59.0 percent to 4.8 billion euros thanks mainly to the acquisition of the U.S. biotech and seed company Monsanto.
However, sales of Bayer's agricultural business saw a decline of 9.9 percent on a pro-forma basis. In this context, sales are presented as if the acquisition of Monsanto and the associated divestments had already taken place as of January 2018.
Business of its Crop Science division had been "significantly impacted" by extreme weather conditions such as flooding and heavy rains in the Midwestern United States while droughts in large parts of Europe and in Canada also had a particularly "negative effect", according to Bayer.
Following the acquisition of Monsanto, Bayer is also confronted with an increasing amount of lawsuits in the United States for an alleged carcinogenic effect of the weed-killer glyphosate developed by the U.S. biotech company.
The agricultural business of the German agrochemical giant has become a risk for Bayer since it is facing enormous cost if the U.S. courts will find glyphosate to be causing cancer. Currently, about 18,400 plaintiffs have filed lawsuits against Bayer over glyphosate, 5,000 more than at the end of the first quarter of 2019.
Bayer is continuing "to believe that it has meritorious defenses and intends to defend itself vigorously in all of these lawsuits" and will "constructively engage" in a mediation process ordered by a district judge in California.
To date, Bayer has lost three glyphosate cases against plaintiffs and has been sentenced to heavy fines. The company has appealed against all three verdicts.
"Bayer is on track in its operational business," said Werner Baumann, chief executive officer (CEO) of Bayer.
While sales of Bayer's agricultural business had been "held back by the extreme weather conditions", the company's prescription medicine division "recorded encouraging growth", according to Bayer CEO Baumann. Business "was also up" at the company's division for self-care products, Bayer stated.
The German agrochemical confirmed its outlook for the second half of 2019 but noted that it would become "increasingly ambitious in view of the challenging environment for the Crop Science business". Bayer is expecting total turnover to amount to 46 billion euros in 2019, which would correspond to a growth of around 4 percent.
