FRANKFURT (Reuters) - Bayer (BAYGn.DE) said on Friday it would cut its full-year earnings forecast due to high inventories at crop protection distributors in Brazil and a weaker-than-expected consumer health business.
“At the end of the harvest season in Brazil, regular stock-taking revealed an unexpectedly high channel inventory level of crop protection products,” the company said in an unscheduled statement.
This would result in a one-time hit of 300-400 million euros (£263-£351 million) on full-year earnings before interest, taxes, depreciation and amortisation (EBITDA).
Bayer, in the midst of seeking regulatory approval for its $66 billion takeover of U.S. seeds group Monsanto MON.N, said it would adjust its business outlook when it publishes second quarter results, due on July 27, without providing details.
The shares were down 4.3 percent to 113 euros at 0758 GMT.
The company also cited unfavourable currency developments but added its pharmaceuticals division and chemicals business Covestro (1COV.DE) were still performing strongly, while business at its animal health unit was line with expectations.
Bayer has been trying to overcome a weaker than expected performance of key consumer care brands Coppertone sun screen and Dr. Scholl’s foot care products, acquired from Merck & Co (MRK.N).
When asked about Bayer’s plan to file for regulatory approval in Europe for the Monsanto deal this quarter, a spokesman said that remarks by Bayer CEO Werner Baumann last week, reaffirming that goal, were still valid.
Reporting by Ludwig Burger; Editing by Harro ten Wolde and Mark Potter