Bayer CropScience Plans to Further Expand Business with High-Margin Products and New Crops    

Bayer CropScience intends to maintain its growth strategy with innovative crop protection agents, high-quality seed and enhanced plant traits. To this end, the company plans to further strengthen its portfolio in conventional crop protection and increase the proportion of new, high-margin products. In the area of seeds and traits, the regional business will be expanded and long-term growth will be generated with new crops. Bayer CropScience intends to pursue research cooperations, licensing agreements and further acquisitions to further strengthen its strategic position. Bayer CropScience released on September 9th.
   Since 2002, Bayer CropScience's sales have risen by nearly 5% annually on average, while the EBITDA margin increased to 23.2% in 2009. Sales reached an all-time high of EUR 6.5 billion in 2009.
   The crop protection industry got off to a difficult start in 2010. First-half sales were also down in the area of seed treatment, where Bayer CropScience is the world's leading supplier, and in fungicides.
   By contrast, the BioScience unit saw considerable growth as in fiscal 2009, and Environmental Science also expanded significantly. This robust growth was however not sufficient to offset the decline in its conventional crop protection business. Sales of Bayer CropScience fell by around 3% overall in the first half of 2010.
   This will not however impact the medium- and long-term business perspectives, which remain very positive. Demand for high-quality food and animal feed, renewable energies and plant fibers continues to rise. The agriculture industry is facing increasingly difficult conditions as a result of climate change. The company drew attention to the growing fluctuations between supply and demand and the increasingly unpredictable weather.
   Professor Dr. Dr. h.c. Friedrich Berschauer reaffirmed his calls for a second green revolution: "Not just agricultural research and technology innovations, but also infrastructural, market and economic aspects, as well as social and political factors must be interlinked and coordinated. Only then can the global supply of affordable food and other agricultural products in a sufficiently high quality be safeguarded."
   Bayer CropScience believes that it is well positioned in this environment, with its integrated solutions for agriculture from sowing to the harvest. In addition to the new active substances that have had to be introduced to the market solely due to the development of resistances by pests, weeds and to combat new diseases, climate protection and sustainability issues are also playing an increasingly important role.
   The company plans to make a contribution towards safeguarding harvests and increasing yields with its new generation of environmentally friendly active ingredients.
   The company anticipates global annual peak sales potential of more than EUR 1 billion from products based on the six new substances it plans to launch between 2010 and 2012.
   Among the new active ingredients are three fungicides from a new generation of fungal respiratory chain inhibitors. They will be launched on the market in 2012 as a seed dressing, a particularly environmentally friendly crop protection method. Another exemplary, innovative new active ingredient from Bayer CropScience's research is the new fungicide Routine R (active ingredient: isotianil) to combat rice blast, the world's most economically important rice disease.
   Bayer CropScience also sees great potential for growth in its business with Seeds & Traits. As the world market leader in several crops, including cotton seeds, the company is able to call up a wealth of expertise and build on it in other segments. Around 18 new products are scheduled to be launched until 2016. For example, cotton seed from Bayer CropScience's own research that is resistant to the herbicide glyphosate will be marketed in the United States next year.
    Sugar cane has also been added to the portfolio. Bayer CropScience is working together with the CTC (Centro de Tecnologia Canavieira) in Brazil, to develop new varieties for ethanol production that will have higher sugar content. Bayer CropScience today added to the numerous research and licensing agreements the company has closed an agreement with the Chinese Oil Crops Research Institute (OCRI) to develop new rapeseed varieties. Bayer CropScience has now entered into around 80 such cooperation projects.
   In Environmental Science too, the business with products for non-agricultural applications, Bayer CropScience aims to offer its customers innovative and sustainable solutions and further strengthen its leading position as the world's number one in professional markets.
   One strategic project is malaria control. Bayer CropScience and Bayer Technology Services have together developed a new generation of mosquito nets which will be launched on the market next year under the name LifeNet.