Bayer 3rd-qtr sales leap 11.5%, but profits down on litigation provisions; buys nutra company

Germany’s Bayer (BAYN: DE) posted third-quarter 2012 financial results this morning showing that group turnover leapt 11.5% to 9.67 billion euros ($12.5 billion), driven by HealthCare subgroup sales of 4.72 billion euros (+12.4%), Crop science at 1.64 billion (+12.8%), and material science sales of 2.99 billion euros (+8.1%). Pharmaceuticals division sales were 2.73 billion euros (+13%) and consumer health 1.99 billion euros (+11.5%).

However, earnings before interest and taxes (EBIT) fell by 23.7% to 838 million euros. Net special items totaled minus 356 million euros (compared with minus 75 million euros in third-quarter 2011). Included here were 205 million euros in further accounting measures taken - mainly based on additional claims asserted but not filed in court - for all cases in connection with the oral contraceptive Yasmin/YAZ (ethinyl estradiol and drospirenone) of which Bayer is currently aware and which the company considers to be worthy of settlement (venous clot injuries). Among the other special charges were 134 million euros in restructuring expenses.

EBIT before special items increased 1.7% to 1.19 billion euros. Earnings before interest, taxes, depreciation and amortization (EBITDA) - before special items - were up by 2.2% to 1.85 billion euros, just beating the 1.83 billion-euro estimate of 11 analysts surveyed by Bloomberg. Net income fell by 17.8% to 528 million euros and core earnings per share advanced 7.1% 1.20 euros. Bayer’s shares edged 0.7% higher in early trading.