Business Description

Bayer AG is engaged in the production, distribution, and development of products in nutrition, health care, and high-tech materials. Friedrich Bayer and Johann Friedrich Westcott founded the company on August 1, 1863. It is located in Leverkusen (Germany). It has the following segments: Crop Science and Animal Health, Pharmaceuticals and Consumer Health,  as well as Covestro. Crop Science includes crops, non-agricultural pest control, and seeds.

Animal Health offers both prescription and nonprescription products for veterinary care.  The Pharmaceuticals segment develops, produces, and markets prescription products for women’s and cardiology; specialty therapeutics in hematology, oncology, and ophthalmology; and diagnostic imaging equipment and necessary contrast agents. Consumer Health manufactures and markets products in dermatology, dietary supplement, and analgesic categories.

Key Financials

Revenue (US$ Mn)

• Bayer AG’s annual revenue for 2021 was US$ 45,957 Mn, a -9.63% decrease from 2020
• The annual revenue generated by Bayer AG in 2020 was US$ 50,856 Mn
• At a 7.62% increase, Bayer AG’s annual revenue of US$ 48,770 Mn was indexed in 2019
• Bayer AG generated total revenue of US$ 45,316 Mn in 2018

Operating Income(US$ Mn)

• US$ 3,496 Mn was the operating income generated by Bayer AG in 2021
• Bayer AG’s operating income for 2020 was US$ -877 Mn, a -117.28% decrease from 2019
• From 2018’s operating incomes, Bayer AG registered a 1272.58% increase in 2019, amounting to US$ 5,076 Mn
• An operating income of US$ 370 Mn was generated in 2018 by Bayer AG

Net Income(US$ Mn)

• Bayer AG’s net income for 2021 was US$ 1,043 Mn, a -108.09% decrease from 2020
• The net income generated by Bayer AG in 2020 was US$ -12,892 Mn
• At a 136.14% increase from, Bayer AG’s net income of US$ 4,582 Mn was indexed in 2019
• Bayer AG generated a net income of US$ 1,940 Mn in 2018

Operating Margin %

• 8% was the operating margin generated by Bayer AG in 2021
• Bayer AG’s operating margin for 2020 was -2%, a -116.35% decrease from 2019
• From 2018’s operating margins, Bayer AG registered a 1200% increase in 2019, amounting to 10%
• An operating margin of 1% was generated in 2018 by Bayer AG

Gross Margin %

• Bayer AG’s gross margin for 2021 was 62%, a 14.87% increase from 2020
• The gross margin generated by Bayer AG in 2020 was 54%
• At a 5.09% increase from, Bayer AG’s gross margin of 60% was indexed in 2019
• Bayer AG generated a gross margin of 57% in 2018

SWOT Analysis

Strengths

Strong revenue growth enhances its market position

In FY2019, Bayer reported revenue of EUR43,545 million as compared to EUR36,742 million in FY2018, an annual growth of 18.5%. The growth in revenue was due to a 39% increase in revenue of its crop science segment driven by a positive portfolio effect of 36.3% from the acquisition of Monsanto in 2018 and a 7.3% increase in revenue from the Pharmaceuticals segment due to growth in China and positive performance of Xarelto and Eylea medicines.

The company’s operating margin was 9.6% in FY2019, as compared to 9.4% in FY2018. In FY2019, the company recorded a net margin of 9.4%, compared to a net margin of 4.6% in FY2018. Strong revenue performance enables the company to provide higher returns to its shareholders thereby attracting further investments. It also enables the company in allocating adequate funds for its operational contingencies

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