Monheim, Germany
October 8, 2004
Package of measures to yield
annual savings of EUR 200 million from 2007: Bayer CropScience
confirms profitability targets Satisfactory operating
performance in current year
Bayer CropScience
aims to grow its EBITDA margin from 19 percent in 2003 to 25
percent by 2006. The company aims to further increase this
margin to 26 percent. The Bayer subgroup, headquartered in
Monheim, Germany, plans to achieve its profitability objectives
with a package of efficiency-enhancing measures, reaching its
full annual savings potential of around EUR 200 million by 2007.
The initiative complements the restructuring project carried out
during the integration of Aventis CropScience since 2002.
"This initiative confirms our clear, long-term profitability
targets," says Professor Dr. Friedrich Berschauer, CEO of Bayer
CropScience. "We are on course to achieve the projected
synergies from the integration and now intend to create the
basis for further growth in the future. Our new process
optimization initiative should make a significant contribution
in this respect from 2007."
Having streamlined its global management structures effective
July 1, 2004, Bayer CropScience now intends to further enhance
efficiency in all areas of the company by continuing to improve
its internal business processes. This includes a review of
procurement, supply chain management and production processes
and adjustments in the field of Research & Development (R&D).
Even after this adjustment Bayer CropScience will be able to
draw on the largest budget for crop protection research and
development in the industry.
These efficiency-boosting measures are expected to become fully
effective by 2007. By then, headcount at Bayer CropScience's
Monheim and Frankfurt sites in Germany is to be reduced by
around 200. This reduction will be performed in a socially
responsible way using the tools agreed with the Works Council,
especially senior part-time working and early retirement
programs.
Bayer CropScience CEO Prof. Dr. Friedrich Berschauer is very
satisfied with the company's operating performance so far in
fiscal 2004. "Following a strong first quarter, we continued to
grow sales in the second quarter."
Sales of Bayer CropScience in the first half increased year on
year by 4.5 percent to EUR 3,374 million, with EBIT up by 11.2
percent from EUR 484 million to EUR 538 million. The realization
of integration synergies played a significant role in this
development. First-half EBITDA was EUR 897 million, 2.3 percent
above the figure for the same period of 2003. "The first half of
2004 went well for us," Berschauer added. "With the new
initiatives outlined today, we are creating a sound basis for
achieving our long-term profitability target."
Bayer CropScience, a subsidiary of Bayer AG with annual sales
of about EUR 5.8 billion (2003), is one of the world's leading
innovative crop science companies in the areas of crop
protection, non-agricultural pest control, seeds and plant
biotechnology. The company offers an outstanding range of
products and extensive service backup for modern, sustainable
agriculture and for non-agricultural applications. Bayer
CropScience has a global workforce of about 19,000 and is
represented in more than 120 countries, ensuring proximity to
dealers and consumers. |