Bayer is planning high savings – billions in depreciation are threatened

In 2021, Bayer sales are expected to be at the level of 2020. The adjusted earnings per share should decrease somewhat. The consequences of the pandemic can still be felt, especially in the agricultural sector. Therefore Bayer wants to work on the costs. From 2024, there should be additional operational savings of more than 1.5 billion euros per year. This can lead to a reduction in jobs.

The impact of the pandemic on the crop science business will be more profound than expected. There the prospects for growth have diminished. This is still burdened by currency effects. Accordingly, there will probably be a special depreciation in the mid to upper single-digit billion range in the agricultural sector.

In the Consumer Health segment, clear growth is expected. There may be smaller acquisitions here. The Pharmaceuticals division is also expected to grow in 2021. Investments should encourage further growth.

Bayer is also currently looking into shedding non-strategic businesses or brands below the divisional level.

The dividend policy is confirmed. The payout ratio should remain at 30 percent to 40 percent. A dividend at the lower end of the range looks more likely in the coming years.

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