According to Dekkers, 2010 was marked by factors the company could not have predicted. In particular, the MaterialScience subgroup returned nearly to pre-crisis levels more quickly than expected. Currency changes also had a positive impact. On the other hand, the business performance of the CropScience and HealthCare subgroups was below expectations. Dekkers expressed optimism for the company's continuing development: "We are confident for this year, which has gotten off to a successful start." He said Bayer plans to invest substantial sums in its future during the next three years. The company aims to spend some EUR 15 billion for research and development and for property, plant and equipment through 2013.Sales of the Bayer Group climbed by 12.6 percent in 2010 to EUR 35,088 million (2009: EUR 31,168 million). Adjusted for currency and portfolio effects (Fx&p adj.), sales were up by 8.0 percent. Earnings before interest, taxes, depreciation and amortization (EBITDA) - before special items - rose by 9.7 percent to EUR 7,101 million (2009: EUR 6,472 million), with currency effects having a positive impact of some EUR 0.4 billion. The operating result (EBIT) before special items advanced by 18.0 percent to EUR 4,452 million (2009: EUR 3,772 million).Earnings of MaterialScience tripled
The trend in Bayer's high-tech materials business was marked by the recovery following the economic and financial crisis. Sales climbed by 35.0 percent (Fx&p adj. 30.1 percent) to EUR 10,154 million (2009: EUR 7,520 million). "Here we see the growth in demand from key customer industries as a major positive factor. This applies particularly to the automotive and electrical/electronics sectors, and in some regions to the construction industry as well," said Dekkers. He explained that while volumes at MaterialScience were already back to pre-crisis levels overall in 2010, this did not yet apply to prices as a whole.Business with raw materials for foams (polyurethanes) expanded by 27.8 percent (Fx&p adj.), thanks largely to much higher volumes in all product groups and regions. The largest increases in absolute terms were registered in Europe and Asia/Pacific. Sales of high-performance plastics (polycarbonate) advanced by 42.9 percent (Fx adj.). This growth was mainly the result of considerable volume and price increases for granules. Business with raw materials for coatings, adhesives and specialties improved by 27.2 percent (Fx adj.) year on year thanks to significant growth in volumes.EBITDA before special items of MaterialScience tripled to EUR 1,356 million (2009: EUR 446 million), mainly due to much higher volumes. The subgroup also benefited from higher selling prices for its products, which more than offset the negative effect of increased raw material prices. Efficiency improvements also had a positive impact.For women in management positions
Dekkers said the Board of Management has set a target: Bayer aims to raise the proportion of female managers in the Bayer Group as a whole toward 30 percent by 2015 - the global figure currently being just over 20 percent. "We are optimistic that we can achieve our target within five years," he said, pointing out at the same time that diversity is not limited to gender distribution. It is equally important to support skilled international employees and managers worldwide, he said. This is something the company is working on intensively at the moment.Invest in R&D
In 2010, the company increased its expenditures for research and development by more than 11 percent to nearly EUR 3.1 billion. "The reason for this is that we are investing in a highly promising product pipeline," he said, citing the innovative developments in Health Care and Crop Science."We scored many achievements in 2010, but we also faced challenges," said Dekkers. He stressed how important it is for Bayer's future development that the company invest more heavily and more rigorously in its potential for growth and innovation, this being the reason why the package of measures announced in November 2010 was developed. The aim is to free up the necessary funds by carefully re-allocating resources. This will be supported by efficiency and cost-containment measures. "The principle here is: more innovation and less administration," Dekkers stressed.Perspectives for 2011 and 2012
The Management Board Chairman sees positive future perspectives for the company's business performance. "It remains to be seen how the global economy will develop once the stimulus programs expire in numerous countries. In any case, we are confident for this year," Dekkers remarked. Provided that the economy steadily improves, he expects to see growth in sales and EBITDA before special items in all subgroups in 2011. For the full year 2011, Bayer expects to see currency- and portfolio adjusted sales growth of between 4 and 6 percent for the Group as a whole. Based on the currency assumptions - including a rate of US$ 1.40 to the euro - Group sales are therefore expected to come in at between EUR 35 billion and EUR 36 billion. Bayer aims to increase EBITDA before special items toward EUR 7.5 billion and raise core earnings per share by about 10 percent."We can confirm our targets for 2012," Dekkers added. If the economic environment remains positive, Bayer continues to expect Group sales to grow by approximately 5 percent - after adjusting for currency and portfolio changes. In 2012 the Group plans to achieve EBITDA before special items of approximately EUR 8 billion and core earnings per share of around EUR 5.MaterialScience expects that the business environment will continue to recover. The subgroup plans to raise sales in 2011 by a mid-single-digit percentage on a currency- and portfolio-adjusted basis, and to increase EBITDA before special items at a higher rate than sales. MaterialScience expects sales in the first quarter of 2011 to be roughly in line with the fourth quarter of 2010 on a currency- and portfolio-adjusted basis. Despite higher raw material prices, MaterialScience expects EBITDA before special items in the first quarter of 2011 to exceed the level of the fourth quarter of 2010. Provided that the market environment remains favorable, the subgroup plans to further increase sales and EBITDA before special items in 2012.Bayer stayed on track operationally in 2010 and is anticipating a further improvement in its key data this year, Dekkers concluded.