Business Development by Segment

Animal Health

Ongoing market growth

In 2016, the Animal Health market continued to develop positively with growth of 5% (2015: 5%). The dynamic performance in the first half of the year was driven especially by the market for companion animal parasiticides in the United States and Europe. In the second half of the year, the market environment for the farm animal business clouded slightly.

Key Data – Animal Health

 

 

Q4 2015

Q4 2016

Change

 

2015

2016

Change

 

 

€ million

€ million

Repor­ted %

Fx & p adj. %

 

€ million

€ million

Repor­ted %

Fx & p adj. %

2015 figures restated; Fx & p adj. = currency- and portfolio-adjusted; Fx adj. = currency-adjusted

1

For definition see Chapter “Alternative Performance Measures Used by the Bayer Group.”

Sales

 

319

329

+3.1

+3.1

 

1,490

1,523

+2.2

+4.8

Change in sales

 

 

 

 

 

 

 

 

 

 

Volume

 

+2.7%

−1.0%

 

 

 

+4.0%

+2.6%

 

 

Price

 

+0.3%

+4.1%

 

 

 

+0.5%

+2.2%

 

 

Currency

 

+3.0%

0.0%

 

 

 

+8.6%

−2.6%

 

 

Portfolio

 

0.0%

0.0%

 

 

 

0.0%

0.0%

 

 

 

 

€ million

€ million

Repor­ted %

Fx adj. %

 

€ million

€ million

Repor­ted %

Fx adj. %

Sales by region

 

 

 

 

 

 

 

 

 

 

Europe / Middle East / Africa

 

91

84

−7.7

−3.3

 

447

445

−0.4

+3.8

North America

 

122

129

+5.7

+4.1

 

587

621

+5.8

+6.0

Asia / Pacific

 

67

79

+17.9

+13.4

 

285

300

+5.3

+5.6

Latin America

 

39

37

−5.1

−2.6

 

171

157

−8.2

+1.8

EBITDA1

 

33

34

+3.0

 

 

317

343

+8.2

 

Special items

 

(8)

(4)

 

 

 

(30)

(6)

 

 

EBITDA before special items1

 

41

38

−7.3

 

 

347

349

+0.6

 

EBITDA margin before special items1

 

12.9%

11.6%

 

 

 

23.3%

22.9%

 

 

EBIT

 

14

25

+78.6

 

 

254

313

+23.2

 

Special items

 

(19)

(5)

 

 

 

(64)

(7)

 

 

EBIT before special items1

 

33

30

−9.1

 

 

318

320

+0.6

 

Net cash provided by operating activities

 

43

85

+97.7

 

 

348

193

−44.5

 

+4.8%

growth in sales at Animal Health (Fx & portfolio adj.)

Sales growth particularly in the United States

Sales of Animal Health in 2016 increased by 4.8% (Fx & portfolio adj.) to €1,523 million. The North America and Asia/Pacific regions developed especially positively due to higher demand. We also registered currency-adjusted sales growth in Europe/Middle East/Africa and Latin America.

Best-Selling Animal Health Products

 

 

Q4 2015

Q4 2016

Change

 

2015

2016

Change

 

 

€ million

€ million

Repor­ted %

Fx adj. %

 

€ million

€ million

Repor­ted %

Fx adj. %

Fx adj. = currency-adjusted

Advantage™ product family

 

105

102

−2.9

+0.3

 

547

535

−2.2

+0.1

Seresto™

 

15

28

+86.7

+75.3

 

113

174

+54.0

+55.4

Drontal™ product family

 

30

31

+3.3

+2.6

 

122

128

+4.9

+7.2

Baytril™

 

33

34

+3.0

−0.9

 

120

113

−5.8

−5.0

Total

 

183

195

+6.6

+6.8

 

902

950

+5.3

+7.3

Proportion of Animal Health sales

 

57%

59%

 

 

 

61%

62%

 

 

Sales by product

+55.4%

growth in sales of Seresto™ (Fx adj.)

  • Currency-adjusted sales of our Advantage™ family of flea, tick and worm control products were level with the previous year. Positive development in Europe / Middle East / Africa and Asia / Pacific stood against slight declines in North America.
  • We achieved very strong sales growth with our Seresto™ flea and tick collar that resulted chiefly from increased demand in the United States and Europe.
  • Business with our Drontal™ line of wormers benefited particularly from higher volumes in the United States and Asia/Pacific.
  • Sales of our antibiotic Baytril™ fell in North America because of a difficult market environment and generic competition. Gains in Asia/Pacific and Latin America were not sufficient to offset this development.

Earnings

In 2016, EBITDA before special items was steady year on year, increasing 0.6% to €349 million. Positive earnings contributions from volume and price increases stood against higher selling expenses and an increased cost of production. A negative currency effect of around €10 million additionally diminished earnings.

EBIT of Animal Health increased by a substantial 23.2% to €313 million, including special charges of €7 million (2015: €64 million).

Special Items1 Animal Health

 

 

EBIT Q4 2015

EBIT Q4 2016

 

EBIT
2015

EBIT
2016

 

EBITDA Q4 2015

EBITDA Q4 2016

 

EBITDA 2015

EBITDA 2016

 

 

€ million

€ million

 

€ million

€ million

 

€ million

€ million

 

€ million

€ million

1

For definition see Chapter “Alternative Performance Measures Used by the Bayer Group.”

Restructuring

 

(19)

(5)

 

(64)

(7)

 

(8)

(4)

 

(30)

(6)

Total special items

 

(19)

(5)

 

(64)

(7)

 

(8)

(4)

 

(30)

(6)

Online Annex: A 2.2.2-4

limited assurance

The development of Animal Health in 2016 is shown in the following graphics.

Animal Health Quarterly Sales

Animal Health Quarterly Sales (bar chart)Animal Health Quarterly Sales (bar chart)

2015 figures restated

Animal Health
Quarterly EBIT

Animal Health Quarterly EBIT (bar chart)Animal Health Quarterly EBIT (bar chart)

2015 figures restated

Animal Health
Quarterly EBITDA before Special Items

Animal Health Quarterly EBITDA before Special Items (bar chart)Animal Health Quarterly EBITDA before Special Items (bar chart)

2015 figures restated