Bayer(US:BAYRY)2021-11-09 18:57Financial Data and Key Metrics Changes - Group sales grew by 14% to €9.8 billion in Q3 2021, with strong contributions from all divisions [18] - EBITDA before special items increased by 16% to €2.1 billion, resulting in a margin of 21.4% [19] - Core earnings per share rose by 30% to €1.05 compared to the prior year quarter [19] - Free cash flow advanced to almost €2 billion in Q3, up from €1.2 billion in the previous year [21] - Year-to-date group sales increased by 9% to €33 billion, with EBITDA before special items at €8.8 billion, showing a 3% decline [22] Business Line Data and Key Metrics Changes - Crop Science reported impressive sales growth of 26% in Q3, driven by 14% from volume and 12% from price increases [24] - Pharma division sales increased by 7% to €4.5 billion, with Eylea contributing significantly with a 19% increase [26] - Consumer Health expanded sales to €1.3 billion, reflecting an 11% growth, with Nutritionals as the key growth driver [29] Market Data and Key Metrics Changes - Crop Science benefited from strong demand and tight supply, particularly for glyphosate-based herbicides in North America [24] - The company anticipates continued strong performance in Latin America for the upcoming season [36] Company Strategy and Development Direction - The company updated its guidance for 2021, expecting better topline growth for Crop Science and Consumer Health, while maintaining the outlook for Pharma [9] - The company is focused on innovation and sustainability, with significant investments in product launches and development of its late-stage pharma pipeline [11][16] - Bayer aims to provide 100 million women in low and middle-income countries with access to modern contraception by 2030 [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong underlying growth dynamics despite challenges from supply chain disruptions [48] - The company expects to see margin accretion going into 2022 due to pricing power and efficiency measures [74] - Management acknowledged the impact of inflation on costs but remains optimistic about passing on these costs to maintain margins [49] Other Important Information - Bayer's patent for Xarelto was maintained until mid-January 2026, which is expected to benefit the company in the coming years [10] - The company is preparing for the launch of ALZUO, a new steroid antihistamine nasal spray for allergies, expected in Q1 2022 [15] Q&A Session All Questions and Answers Question: Margin dynamics in Crop Science for Q4 - Management explained that Q3 benefited from lower returns and higher royalties, but Q4 may see a different dynamic due to a plant outage affecting glyphosate production [44][46] Question: Importance of finerenone data for KERENDIA - Management highlighted the significance of the FIGARO trial data in broadening the patient population for finerenone and mentioned ongoing clinical trials for heart failure [59] Question: Update on environmental science disposal - Management confirmed that the process for selling the environmental science asset is underway, with significant demand expected [114] Question: Sustainability of Consumer Health growth - Management indicated that while Q3 growth was exceptional, underlying dynamics suggest continued strength, particularly in Nutritionals [115]