28 February 2013 23:54 [Source: ICIS news]
LONDON (ICIS)--Bayer predicts that a strong performance for its crop sciences subsidiary over the next few years, and is planning to assist that growth through strategic acquisitions, the Germany-based chemicals company said on Thursday.
Speaking at a press conference at the company’s Leverkusen, Germany headquarters, CEO Marijn Dekkers predicted that the Bayer CropScience subsidiary would generate year-on-year sales growth of around 6% to 2015, with annual sales expected to increase to nearly €10bn ($13bn) by the end of that year.
The division, which serves the agribusiness sector, recorded year-on-year sales growth of 12.4% in 2012, to €8.4bn, and a 21.4% increase in earnings before interest, taxes, debt and amortisation (EBITDA) to €2bn.
“There was a positive impact [during 2012] from the favourable market environment for agricultural commodities such as wheat, corn, rice and soybeans,” said Dekkers.
The company noted in particular a 14% sales increase in Bayer CropScience’s seeds business unit during 2012, to €1bn, and is to prioritise the development of that section of the divison through bolt-on acquisitions.
“We aim to continue growing this business so that we can increase our share of the rapidly expanding global seeds market. This means intensifying our research and development efforts and continuing to strategically strengthen our portfolio through bolt-on acquisitions,” said Dekkers.
Dekkers added that the company does not set out as concrete future forecasts for its Bayer MaterialSciences subsidiary as it does for its crop sciences and healthcare units –both predicted to outperform the general market to 2015 – as the chemicals business is tied to global economic cycles to a much greater extent.
“It’s easier for us to guide specific numbers in healthcare and crop sciences because they are less dependent on the cyclicality of the economy. It doesn’t mean they couldn’t be cyclical – crop science is cyclical - but much less based on the economy. The cyclicality [for crop sciences] comes from weather,” he said.
($1 = €0.76)
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