(RTTNews.com) – German conglomerate Bayer AG (BAYZF.PK, BAYRY.PK, BYR.L), which is in $ 66 billion deal to acquire U.S. seed firm Monsanto Co. ( MON ), on Wednesday raised its core earnings forecast for fiscal 2016 after reporting higher profit and sales in its third quarter. Further, the company maintained guidance for adjusted EBITDA, a key earnings metric, and sales. The stock is currently trading 3 percent lower in Germany.
For fiscal 2016, the company now expects core earnings per share from continuing operations to grow by a high-single-digit percentage, compared to previous estimate of a mid- to high-single-digit percentage growth.
The company continues to plan to increase EBITDA before special items by a high-single-digit percentage.
For the Life Science activities, i.e. Bayer group excluding Covestro, sales are still expected to be approximately 35 billion euros, corresponding to a mid-single-digit percentage increase.
Regarding its planned acquisition of Monsanto, Bayer said it has initiated the process of obtaining various approvals for the deal. It intends to submit the necessary application in the United States before the end of this year and in the European Union probably in the first quarter of 2017.
In terms of financing, Bayer successfully closed syndication of the $ 57 billion bank facilities at the beginning of October.
In its third quarter, the company’s net income climbed 18.8 percent to 1.19 billion euros from last year’s 999 million euros.
The latest results included charges in connection with the agreed acquisition of Monsanto, efficiency improvement measures and the integration of acquired businesses.
Core earnings per share from continuing operations were 1.73 euros, compared to 1.69 euros a year ago.
Earnings before interest and tax or EBIT advanced 14.2 percent to 1.795 billion euros. EBIT before special items increased 8.1 percent to 1.92 billion euros. Adjusted EBITDA was 2.68 billion euros, 6 percent higher than last year.
In the quarter, sales grew 2.3 percent to 11.26 billion euros from 11 billion euros in the prior year. Sales increased by 3.5 percent after adjusting for currency and portfolio changes.
Sales of prescription medicines grew 7.3 percent, benefited mainly by strong development of recently launched products. The oral anticoagulant Xarelto, the eye medicine Eylea, the cancer drugs Xofigo and Stivarga, and the pulmonary hypertension treatment Adempas posted total combined sales of 1.395 billion euros, higher than last year.
Sales of the agricultural business were down 1.2 percent on a reported basis, but were flat adjusted for currency and portfolio effects.
In Germany, Bayer shares were trading at 89.16 euros, down 2.56 percent.
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Plantations International