FRANKFURT (Reuters) — Agriculture and pharmaceutical company Bayer reported better-than-expected quarterly earnings last week as a temporary price boost for its glyphosate-based herbicides made up for a decline in sales of its stroke prevention pill Xarelto.
The German company said Nov. 8 that third-quarter adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) rose 17.3 percent to US$2.45 billion, which was above analysts’ average estimates.
Bayer, which acquired glyphosate products as part of its takeover of Monsanto, is benefiting by more than doubling average glyphosate prices since early 2021 after hurricane Ida damaged rival producers, chief executive officer Werner Baumann told journalists.
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But finance chief Wolfgang Nickl said prices had begun to drop during the third quarter.
“We expect them to normalize further in the fourth quarter,” he added.
Bayer said its full-year outlook issued in August still stood but cost inflation would continue next year.
Bayer has been hit by litigation costs over cancer claims by mostly individual users of glyphosate-based herbicides, but demand for the products from farmers has not been affected.
A recent string of five courtroom victories has encouraged Bayer to be stricter on legal settlements, which have cost it billions so far even after regulators declared the products safe.
The company said in August it was targeting 2022 adjusted EBITDA of about $13.1 billion, based on June 30 foreign exchange rates, up from $11.2 billion in 2021.
The crop science division saw adjusted EBITDA gain 33.5 percent to $634 million, beating a market consensus of $593 million, as a strong glyphosate business more than offset weaker corn and soy seed sales after U.S. farmers scaled back planting due to drought.
