Bayer sees forth quarter profit fall by 32 per cent

German chemical giant Bayer said that its net profit during the fourth quarter fell by 32 per cent.

The company said that its net income came in at 46 million euros during the last three months of 2005, a fall of 32 per cent from 68 million euros measured in the fourth quarter of 2004. Bayer said that a one-off payment of 322 million euros was made to settle an anti-trust litigation.

However, the company remained bullish about its sales for the period, highlighting that the fourth quarter was also its strongest in sales terms. Sales of 7.095 billion euros were up 16.1 per cent on the year before.

Bayer claimed to have an overall “successful year in 2005,” with group net income rising from 700 billion euros to 1.6 billion euros.

“We made significant gains in our key indicators, including sales, earnings and cash flow performance. Our return on capital was at a record level,” it said.

However analysts, speaking to Bloomberg, said that other problems may be plaguing Bayer.

Dennis Nacken of Helaba Trust in Frankfurt said that the worries surround Bayer’s material science division: “[It] may have reached a peak. With additional capacity coming on stream, competition pressure could intensify.”

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