October 30, 2012

Third quarter of 2012:

Bayer on track for a successful 2012

Upward trend at HealthCare and CropScience continues / Sales advanced by 11.5 percent to EUR 9,665 million / EBIT of EUR 838 million (minus 23.7 percent) / EBITDA before special items improved by 2.2 percent to EUR 1,845 million / Net income of EUR 528 million (minus 17.8 percent) / Further progress with innovation pipeline / Group forecast for 2012 confirmed
Leverkusen, October 30, 2012 - The Bayer Group remains on a path of growth.
"The upward trend in our life science businesses - HealthCare and CropScience -
continued in the third quarter of 2012," Management Board Chairman Dr. Marijn
Dekkers said Tuesday following the publication of the interim report.
HealthCare, particularly the Pharmaceuticals business, gained further growth
momentum. At CropScience, the strong business development seen in the first
half of the year continued unabated, and MaterialScience also registered good
quarterly sales. However, net income was down year on year due to special
charges - particularly for legal claims and restructuring. Bayer also made good
progress from a strategic perspective in the third quarter, Dekkers explained.
He said the company had strengthened its life science businesses through
acquisitions and also made further progress with its innovation pipeline. "We
remain on a successful path, and we confirm our guidance for 2012."

Sales of the Bayer Group advanced by 11.5 percent in the third quarter, to EUR
9,665 million (Q3 2011: EUR 8,670 million). The currency- and
portfolio-adjusted (Fx & portfolio adj.) increase was 5.5 percent. Earnings
before interest and taxes (EBIT) fell by 23.7 percent to EUR 838 million (Q3
2011: EUR 1,099 million). Net special items totaled minus EUR 356 million (Q3
2011: minus EUR 75 million). Included here were EUR 205 million in further
accounting measures taken - mainly based on additional claims asserted but not
filed in court - for all cases in connection with the oral contraceptive
YasminTM/YAZTM of which Bayer is currently aware and which the company considers
to be worthy of settlement (venous clot injuries). Among the other special
charges were EUR 134 million in restructuring expenses.

EBIT before special items increased by 1.7 percent to EUR 1,194 million (Q3
2011: EUR 1,174 million). Earnings before interest, taxes, depreciation and
amortization (EBITDA) - before special items - were up by 2.2 percent to EUR
1,845 million (Q3 2011: EUR 1,805 million). Net income fell by 17.8 percent to
EUR 528 million (Q3 2011: EUR 642 million). Core earnings per share advanced by
7.1 percent to EUR 1.20 (Q3 2011: EUR 1.12).

Gross cash flow declined by 22.9 percent to EUR 1,023 million (Q3 2011: EUR
1,327 million), mainly because of the lower EBIT. Net cash flow, however, rose
by 26.1 percent to EUR 1,989 million (Q3 2011: EUR 1,577 million) due to a
seasonal decrease in cash tied up in working capital. Net financial debt was
reduced from EUR 7.9 billion on June 30, 2012, to EUR 6.8 billion on September
30, 2012 thanks to the operating cash flow.

HealthCare particularly successful in North America and the emerging markets

Sales of the HealthCare subgroup climbed by 12.4 percent in the third quarter,
to EUR 4,719 million (Q3 2011: EUR 4,200 million). Adjusted for currency and
portfolio effects, the increase came to 5.5 percent. Both segments -
Pharmaceuticals and Consumer Health - contributed to this growth. "Business
developed favorably at HealthCare, especially in North America and the emerging
markets," Dekkers pointed out. The growth momentum was undiminished, especially
in China.

Sales of the Pharmaceuticals segment rose by 13.0 percent (Fx & portfolio adj.
6.1 percent) to EUR 2,734 million. Among the segment's best-selling products,
the anticoagulant XareltoTM achieved the strongest growth following its market
introduction in further countries and indications. The significant 22.5 percent
(Fx adj.) increase in revenues from the hormone-releasing intrauterine device
MirenaTM was based mainly on higher volumes in the United States. Sales of the
antidiabetic GlucobayTM developed especially well in China, gaining 23.5 percent
(Fx adj.). Business with the blood-clotting product KogenateTM also developed
positively, with sales advancing by 8.9 percent (Fx adj.). In this case growth
was driven by increased shipments to a distribution partner and by tender
business in Australia. The 4.2 percent (Fx adj.) increase in sales of the
cancer drug NexavarTM was mainly due to gains in China and in the United States.
Business with the YAZTM/YasminTM/YasminelleTM line of oral contraceptives was
hampered by generic competition, especially in Western Europe. Sales gains in
the Asia/Pacific and Latin America regions only partly compensated for this
effect, with sales of this product line down by 4.0 percent (Fx adj.) overall.
Business with the multiple sclerosis treatment BetaferonTM/BetaseronTM receded by
6.1 percent (Fx adj.).

Sales in the Consumer Health segment rose by 11.5 percent (Fx & portfolio adj.
4.7 percent) to EUR 1,985 million. All divisions contributed to this
performance, especially the non-prescription medicines (Consumer Care) and the
company's veterinary pharmaceuticals (Animal Health). In the Consumer Care
Division, business with the skincare product BepanthenTM/BepantholTM (Fx adj.
plus 19.5 percent) and the antifungal CanestenTM (Fx adj. plus 18.4 percent)
benefited from increased marketing activities in Europe. In the Medical Care
Division, sales of the ContourTM line of blood glucose meters developed well (Fx
adj. plus 11.7 percent), while business with contrast agents and medical
equipment was slightly down. The growth driver at Animal Health was the
AdvantageTM line of flea, tick and worm control products, sales of which
increased by 25.1 percent (Fx adj.) against a weak prior-year quarter, mainly
due to sales gains in North America and successful marketing.

EBITDA before special items of HealthCare improved by 5.8 percent to EUR 1,297
million (Q3 2011: EUR 1,226 million), mainly thanks to the good business
development at Pharmaceuticals and positive currency effects.

CropScience continues strong development seen in the first half

"Our agricultural business maintained nearly the same momentum as in the first
half," said Dekkers. The CropScience subgroup raised sales by 19.0 percent (Fx
& portfolio adj. 12.8 percent) to EUR 1,641 million (Q3 2011: EUR 1,379
million). Sales growth was especially brisk in Europe and North America, but
business also expanded by a double-digit percentage in Latin
America/Africa/Middle East. Business was supported by the positive market
conditions, with continuing high prices for agricultural commodities.

The Crop Protection business developed positively in all product groups and
regions. SeedGrowth - the business with seed treatment products - showed a
particularly strong increase of 23.7 percent (Fx & portfolio adj.). The
Fungicides business also developed very successfully (Fx & portfolio adj. plus
15.5 percent). Insecticides sales also advanced by a substantial 7.5 percent,
while sales of Herbicides increased by 4.3 percent (Fx & portfolio adj.).

The Seeds business expanded by a substantial 39.1 percent (Fx & portfolio
adj.). The increase was driven by sales in North America, especially of canola
seed. Sales of vegetable seeds were level with the previous year. Sales of the
Environmental Science business unit rose by 8.8 percent (Fx adj.).

EBITDA before special items of CropScience increased by 14.5 percent to EUR 189
million (Q3 2011: EUR 165 million). This was attributable above all to higher
volumes and to favorable currency effects. The progress made with efficiency
improvement programs also had a positive impact on earnings. However,
manufacturing and selling expenses increased.

MaterialScience raises volumes

Sales of the high-tech materials business moved ahead by 8.1 percent (Fx &
portfolio adj. 2.9 percent) in the third quarter, to EUR 2,992 million (Q3
2011: EUR 2,768 million). "This growth was due to higher volumes overall," said
Dekkers. Volumes were flat with the prior year in Europe, while there was a
gratifying increase in the other regions. Selling price declines in
Asia/Pacific were nearly offset by increases in the other regions.

Business with raw materials for foams (Polyurethanes) increased by 10.2 percent
(Fx & portfolio adj.), driven mainly by higher volumes in all product groups
and regions and by price increases in all regions except North America.
However, the high-tech plastics business (Polycarbonates) shrank by 10.5
percent (Fx & portfolio adj.) against the strong prior-year quarter. This was
attributable to lower volumes and selling prices in both product groups -
granules and polycarbonate sheet/semi-finished products. Sales of raw materials
for coatings, adhesives and specialties advanced by 2.8 percent (Fx & portfolio
adj.), while Industrial Operations grew revenues by 4.6 percent (Fx & portfolio
adj.).

EBITDA before special items for this subgroup was down by 4.3 percent to EUR
333 million (Q3 2011: EUR 348 million). The lower earnings were largely the
result of increases in raw material and energy costs and a slight drop in
selling prices. These factors were only partly offset by volume growth, savings
from efficiency programs, and positive currency effects.

Gratifying improvement in sales and underlying earnings in the first nine months

"We saw a gratifying improvement in sales and earnings before special items in
the first nine months of 2012, with CropScience making a particularly strong
contribution," said Dekkers. Sales climbed by 9.4 percent (Fx & portfolio adj.
5.2 percent) to EUR 29,898 million (9M 2011: EUR 27,337 million). EBIT receded
by 8.4 percent to EUR 3,225 million (9M 2011: EUR 3,520 million). By contrast,
EBITDA before special items rose by 6.4 percent to EUR 6,459 million (9M 2011:
EUR 6,072 million). Net income of the Bayer Group came in at EUR 2,072 million
(9M 2011: EUR 2,073 million), while core earnings per share advanced by 12.7
percent to EUR 4.35 (9M 2011: EUR 3.86).

Life sciences benefit from innovations and acquisitions

"Our current and future success and our growth are based on our new and
innovative products in the life sciences," Dekkers added. "Our primary goal is
therefore to grow organically on the basis of our innovative capability. We are
supplementing this with targeted small to mid-size acquisitions in the life
sciences that take us forward strategically."

Bayer made good progress with the expansion of its life science businesses in
the third quarter, Dekkers said. At HealthCare, for example, the positive
newsflow continued for the innovative anticoagulant XareltoTM. This product was
launched in further countries and indications. More than two-and-a-half million
patients worldwide have received XareltoTM in everyday medical practice since it
received the first approval in 2008. Dekkers said the late-stage pharmaceutical
pipeline is well-stocked in other ways too, citing marketing approvals for the
eye medicine EyleaTM and the cancer drug StivargaTM (active ingredient:
regorafenib) along with positive study data for the development candidate
riociguat in pulmonary hypertension.

In the CropScience business, Bayer believes that products with estimated launch
dates between 2011 and 2016 have a combined peak sales potential of more than
EUR 4 billion. Included here are eight projects in the Crop Protection unit and
some 18 projects in Seeds for the broad-acre crops of cotton, oilseed
rape/canola, rice, wheat and soybeans alone.

Dekkers described the acquisition of Schiff Nutrition International - which had
just been announced - as an important building block for Bayer's Consumer Care
business. "The two companies' brands and products ideally complement each other
in many areas. Closing is subject to customary closing conditions and is
expected by year end 2012." He also referred to the agreement for Bayer to
acquire the animal health business of Teva, saying this transaction is aimed at
strengthening the Animal Health Division starting in 2013. Drawing attention to
the recent successful acquisition of AgraQuest, Dekkers said this was an
important purchase for CropScience that expands the subgroup's business with
biological crop protection products.

Core earnings per share to rise by about 10 percent in 2012

"We confirm the sales and earnings forecast for 2012 that we raised in July,"
said Dekkers. Bayer continues to anticipate a currency- and portfolio-adjusted
sales increase of between 4 and 5 percent for the full year 2012, which would
result in Group sales of about EUR 39 to 40 billion. This guidance is based on
the exchange rates prevailing at the end of the third quarter. As before, the
Group plans to increase EBITDA before special items by a high-single-digit
percentage. Bayer continues to expect to raise core earnings per share by about
10 percent. In addition to the special charges already recognized, Bayer
anticipates further expenses of EUR 0.2 billion for ongoing restructuring
programs in the fourth quarter of 2012.

HealthCare's top priority remains to successfully commercialize the new
pharmaceutical products. This subgroup continues to expect sales to increase by
between 3 and 4 percent after adjusting for currency and portfolio effects.
EBITDA before special items is planned to improve by a mid- to
high-single-digit percentage to which high positive currency effects will
contribute. Bayer forecasts sales of the Pharmaceuticals segment to move
slightly higher on a currency- and portfolio-adjusted basis, with EBITDA before
special items rising by a mid-single-digit percentage. In the Consumer Health
segment, the company expects that sales will grow by a mid-single-digit
percentage on a currency- and portfolio-adjusted basis and that EBITDA before
special items will increase by a high-single-digit percentage.

As before, CropScience anticipates that sales will advance by approximately 10
percent on a currency- and portfolio-adjusted basis and that EBITDA before
special items will improve by approximately 20 percent. This subgroup continues
to predict above-market growth.

MaterialScience anticipates a significant currency- and portfolio-adjusted
sales gain and significantly higher EBITDA before special items in the fourth
quarter of 2012 compared to the weak prior-year quarter. For the full year
2012, this subgroup now expects sales to show a small currency- and
portfolio-adjusted increase (previously: to remain level with the prior year)
and continues to expect EBITDA before special items to remain level with the
prior year.

Note:
The tables below contain the key data for the Bayer Group and its subgroups for
the third quarter and the first nine months of 2012.

The complete financial report as of September 30, 2012 is available for online
viewing and download at www.investor.bayer.com.

Supplementary features at www.investor.bayer.com:
- live broadcast of the news conference call from approximately 10:00 a.m. CET
- presentation charts for the investor conference call at 12:00 noon CET
- live webcast of the investor conference call from approximately 2:00 p.m. CET
- recording of the investor conference call from approximately 5:00 p.m. CET


Forward-looking statements

This release may contain forward-looking statements based on current
assumptions and forecasts made by Bayer Group or subgroup management. Various
known and unknown risks, uncertainties and other factors could lead to material
differences between the actual future results, financial situation, development
or performance of the company and the estimates given here. These factors
include those discussed in Bayer's public reports, which are available on the
Bayer website at www.bayer.com. The company assumes no liability whatsoever to
update these forward-looking statements or to conform them to future events or
developments.