Bayer swings to Q4 net loss of €145m on higher special charges

SINGAPORE (ICIS)--Bayer posted a €145m ($199m) net loss in the fourth quarter of 2010 because of higher special charges, reversing a €153m profit made in the same period a year earlier, the German specialty chemicals maker said on Monday.

Sales for the three months to December rose 14.5% year on year to €9.01bn, while earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 34.9% to €1.51bn, it said.

Bayer chief financial officer Werner Baumann attributed the growths in sales and EBITDA to the strong performance of the company’s material science business and to positive currency effects.

Bayer MaterialScience posted a 28.2% year-on-year rise in sales to €2.58bn in the fourth quarter, while EBITDA surged 85.6% to €297m, the company said in a statement.

However, higher special charges caused the group’s earnings before interest and taxes (EBIT) to fall 86.1% year on year €51m in the fourth quarter of 2010.

For the full year of 2010, the company’s net profit slipped 4.3% year on year to €1.3bn, despite sales rising 12.6% to an all-time high of €35.1bn.

“Net income of the Bayer Group for 2010 was held back considerably by special charges of €1.72bn [from €766m in 2009],” Bayer said.

The company’s overall EBITDA, meanwhile, rose 8.1% year on year to €6.29bn.

EBITDA before special items in 2010 increased 9.7% to €7.10bn.

In its outlook, Bayer said that it expects to see growth in sales and EBITDA before special items in all of its businesses in 2011.

Group sales this year were expected to come in at between €35bn and €36bn, it said.

“Bayer aims to increase EBITDA before special items toward €7.5bn and raise core earnings per share by about 10%,” the company added.

The company’s core earnings per share last year €4.19/share, up 15.1% from 2009, it said.

($1 = €0.73)

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