German diversified group Bayer is aiming for a return to growth in adjusted core earnings this year as higher profit at its agriculture division would likely be tempered by investments in new genetic treatment technologies.
Earnings before interest, tax, depreciation and amortisation (EBITDA) before special items should reach €12 billion in 2022, when adjusted for currency swings, up 7% from €11.18 billion last year, the company said.
Bayer said its fourth-quarter adjusted EBITDA was flat at €2.4 billion, in line with the average analyst forecast.
This resulted in a 2.5% decline for the full year due to higher costs, negative currency effects and drug development spending.
The maker of drugs and farming supplies said it was aiming for earnings growth at its crop science division due to mark-ups in prices, market share gains as well as efficiency measures that offset inflationary cost pressures.
Bayer is catching up with its closest rival Corteva in the US seeds market, offering a soy variety that resists a higher number of weedkillers.
The company warned that its outlook assumed a stable geopolitical environment in Eastern Europe, now thrown into doubt by Russia's invasion of Ukraine.
"Bayer will closely monitor and mitigate these risks to the extent possible," it added.
In a media call, chief executive Werner Baumann said the company's focus on health and nutrition meant it would work hard to give civilians in Ukraine and Russia continued access to its products.
In Russia, which accounts for about 2% of group sales, money transfers have so far not been affected by Western sanctions on banks but finance chief Wolfgang Nickl described the situation as "super volatile".
In Ukraine, where Bayer derives well below 1% of its revenue, staff were handed out cash as part of a range of support measures, CEO Baumann added.
The company has built what it describes as one of the leading cell and gene therapy platforms in the industry, boosting its long-term drug development prospects but requiring substantial expenditure.
A successful clinical trial prompted the drugmaker last month to boost its peak sales estimates for prostate cancer drug Nubeqa to more than €3 billion.
