Bayer reported on Tuesday a colossal net loss in the second quarter, weighed down by the agreement signed in June in the United States to settle the proceedings against glyphosate, and by the Covid-19 pandemic, which led to lower its forecasts for 2020.
The German chemicals group reports a net loss of 9.5 billion euros (10.3 billion euros) in the second quarter of 2020, against a profit of 404 million euros in the same period in 2019.
This sharp drop is notably the result of the “exceptional effect” caused by “the major agreement reached in the context of the proceedings against Monsanto,” the group said in a statement.
The company resolved to sign an agreement in June between 8.8 and 9.6 billion dollars to settle more than 125,000 claims in the United States against Round’up, a glyphosate-based pesticide marketed by its Monsanto subsidiary, acquired in 2018.
The American plaintiffs accused this pesticide, suspected of being carcinogenic by the Circ, a branch of the WHO, of having caused the disease from which they suffer.
The Leverkussen group was also largely affected by the pandemic, which plagued its activities in the second quarter, after having had a positive effect in the first quarter.
Bayer saw a decrease in its adjusted revenue of 2.5% to 10.7 billion euros.
The pharmaceutical division, with an operating loss (EBITDA) of 7.1%, was particularly affected.
“Contact restriction measures introduced all over the world due to the coronavirus pandemic have led to the […] postponement of many treatments “, comments the group to explain this decline.
The agrochemicals division, the engine of the group’s growth in recent quarters, nevertheless reports an increase in its turnover corrected for currency and market effects of 3.2%.
The Covid-19 pandemic has led the group to revise its 2020 targets downwards: Bayer now forecasts a turnover “between 43 and 44 billion”, while it expected “between 44 and 45 billion” previously, in February latest.