July 27, 2017
Second quarter of 2017:

Bayer: Group performance matches prior year despite declines at Crop Science

Group sales increase by 3.0 percent (Fx & portfolio adj.: plus 1.9 percent) to EUR 12,193 million / EBITDA before special items level with the prior year, at EUR 3,056 million (plus 0.1 percent) / Pharmaceuticals posts strong increase in earnings and margins / Brazil business weighs on Crop Science / Consumer Health encounters difficult market environment in the United States / Significant increase in sales and earnings at Covestro / Net income decreases by 11.3 percent to EUR 1,224 million / Core earnings per share EUR 1.81 (minus 12.6 percent) / Monsanto acquisition on track / Group outlook for 2017 adjusted
Leverkusen, July 27, 2017 - The Bayer Group's performance in the second quarter
of 2017 matched the prior-year period, despite the company registering declines
at Crop Science. "At Crop Science, we experienced a significant decline in
sales and earnings in connection with high channel inventories in Brazil, the
world's second-largest agriculture market," CEO Werner Baumann said when he
presented the interim report for the second quarter on Thursday. "However, we
generated an encouraging increase in earnings and margins at Pharmaceuticals
and Animal Health," he noted. Business declined at Consumer Health, primarily
due to the difficult market environment in the United States. Sales and
earnings of the company's Life Science businesses were down overall. Covestro,
for its part, once again posted substantial growth in sales and earnings. In
view of performance at Crop Science and Consumer Health, the Bayer Group has
revised its outlook for the full year.

As regards the planned acquisition of Monsanto, Baumann believes the company
remains on track. "We are making progress in our discussions with regulatory
authorities and are on schedule," he said. On June 30, 2017, Bayer had filed an
application with the European Commission seeking approval for the planned
acquisition of Monsanto, representing a further significant milestone in the

Sales of the Bayer Group increased by 3.0 percent to EUR 12,193 million (Q2
2016: EUR 11,833 million) in the second quarter of 2017. Adjusted for currency
and portfolio effects (Fx & portfolio adj.), sales advanced by 1.9 percent.
Sales of the Life Science businesses amounted to EUR 8,714 million (Q2 2016:
EUR 8,858 million), down by 2.8 percent (Fx & portfolio adj.) year on year.
Group EBITDA before special items came to EUR 3,056 million (Q2 2016: EUR 3,054
million), matching the prior-year quarter (plus 0.1 percent). At EUR 2,151
million (Q2 2016: EUR 2,138 million), EBIT was also in line with the previous
year (plus 0.6 percent), and included net special charges in the amount of EUR
205 million (Q2 2016: EUR 104 million). These primarily reflected value
adjustments at the Pharmaceuticals segment, expenses in conjunction with the
acquisition of Monsanto, and charges relating to efficiency improvement
programs. EBIT before special items moved ahead by 5.1 percent to EUR 2,356
million (Q2 2016: EUR 2,242 million).

Net income declined by 11.3 percent to EUR 1,224 million (Q2 2016: EUR 1,380
million), and core earnings per share (total) by 16.2 percent to EUR 1.40 (Q2
2016: EUR 1.67). Core earnings per share from continuing operations fell by
12.6 percent to EUR 1.81 (EUR 2.07). Material effects included the reduction of
Bayer's interest in Covestro and the increased number of shares following the
issuance of the mandatory convertible notes in November 2016.

Net cash provided by operating activities (total) climbed by 16.7 percent to
EUR 2,313 million (Q2 2016: EUR 1,982 million). Net financial debt of the Bayer
Group declined by EUR 1.0 billion to EUR 9.4 billion between March 31, 2017,
and the end of the second quarter. Cash inflows from operating activities and
positive currency effects offset the outflow for the dividend payment. The
Group generated proceeds of approximately EUR 1.0 billion from the sale of
Covestro shares.

Pharmaceuticals achieves substantial increase in earnings

Sales of prescription medicines rose in the second quarter by 4.4 percent (Fx &
portfolio adj.) to EUR 4,304 million (Q2 2016: EUR 4,104 million). "At
Pharmaceuticals, we once again benefited from the strong performance of our key
growth products, and achieved a very encouraging increase in earnings and
margins," Baumann said. The oral anticoagulant Xarelto™, the eye medicine
Eylea™, the cancer drugs Xofigo™ and Stivarga™, and the pulmonary hypertension
treatment Adempas™ posted total combined sales of EUR 1,555 million (Q2 2016:
EUR 1,332 million). Sales of Xarelto™ once again increased substantially,
rising by 18.4 percent adjusted for currency effects (Fx adj.), due primarily
to higher volumes in Europe and China. Eylea™ also delivered significant
growth, with sales advancing by 10.6 percent (Fx. adj.), thanks largely to
higher volumes in Europe and encouraging sales gains in Canada and Australia.
Sales of Xofigo™ increased by a substantial 28.0 percent (Fx adj.), with
business benefiting from a successful market launch in Japan and growth in the
United States and Europe. Stivarga™ also posted significant sales growth of
20.8 percent (Fx adj.). Performance was driven by business in the United
States, where, among other things, the product obtained approval as a
second-line treatment for patients with hepatocellular carcinoma. Sales of
Adempas™ advanced by 17.9 percent (Fx adj.), buoyed by its continued positive
performance in the United States.

Business with the hormone-releasing intrauterine devices of the Mirena™ product
family was up overall, with sales increasing by 4.5 percent (Fx adj.). In the
United States, performance continued to be buoyed by the successful market
launch of the Kyleena™ intrauterine device. In contrast, sales of the Kogenate™/
Kovaltry™ blood-clotting medicines were down year on year overall, declining by
7.7 percent (Fx adj.), due to order volumes placed by the product's
distribution partner remaining significantly lower. As expected, business with
the multiple sclerosis product Betaferon™/Betaseron™ declined, with sales down
by 6.4 percent (Fx adj.). This was largely due to lower demand in the United
States and Latin America. Overall, the Pharmaceuticals business grew in all

EBITDA before special items of Pharmaceuticals improved by a very encouraging
9.5 percent to EUR 1,481 million (Q2 2016: EUR 1,352 million). Positive
earnings effects resulted primarily from higher volumes, while the cost of
goods sold and expenses for research and development were lower.

Consumer Health registers decline in business

Sales of self-care products fell by 2.2 percent (Fx & portfolio adj.) to EUR
1,542 million (Q2 2016: EUR 1,553 million). "At Consumer Health, we experienced
substantial declines in sales in North America, especially in the United
States, due to the difficult market environment," Baumann explained. "In
contrast, we expanded our business in Latin America and Europe/Middle

Sales of Bepanthen™/Bepanthol™ wound and skin care products advanced by 4.9
percent (Fx adj.), driven by performance in Asia/Pacific and Latin America. The
considerable increase in sales of the prenatal vitamin Elevit™, at 9.9 percent
(Fx adj.), was largely the result of demand remaining strong in Asia/Pacific,
primarily in China. Sales of the analgesic Aspirin™ matched the strong
prior-year quarter. Including business with Aspirin™ Cardio, which is reported
under Pharmaceuticals, sales advanced by 4.9 percent (Fx adj.). In contrast,
business with the antihistamine Claritin™ declined substantially compared with
a strong prior-year quarter, primarily in the United States and China. Sales of
the product were down 12.3 percent (Fx adj.). In the United States, business
was impacted by a weaker allergy season, among other things, while sales in the
prior-year quarter had been buoyed by the market launch of ClariSpray™. Sales
of the sunscreen product Coppertone™ were significantly lower year on year,
falling by 16.7 percent (Fx adj.). This development was mainly due to increased
competitive pressure and a weak season to date in the United States.

EBITDA before special items of Consumer Health declined by 4.3 percent to EUR
314 million (Q2 2016: EUR 328 million). The fall in earnings is mainly
attributable to lower volumes and the higher cost of goods sold, which resulted
in part from inventory write-offs.

Substantial decline in sales and earnings at Crop Science

Second-quarter sales of the agricultural business (Crop Science) fell by 15.8
percent (Fx & portfolio adj.) to EUR 2,163 million (Q2 2016: EUR 2,518
million). "This decline is mainly due to significantly higher provisions for
crop-protection product returns in Brazil," Baumann explained. At the end of
the harvest season, regular stocktaking revealed high channel inventories in
the Brazilian market, requiring measures to be taken to normalize the
situation. The high level of channel inventories was caused by weaker demand
due to significantly lower insect and fungal infestation levels, while
inventory-building among distributors remained at a high level. Excluding the
EUR 428 million decline in sales in Brazil, business at Crop Science was up
slightly year on year on a currency-adjusted basis. Sales advanced by 5.0
percent (Fx adj.) in North America, while sales in Europe/ Middle East/Africa
matched the prior-year level (Fx adj.: minus 0.2 percent). In the Asia/Pacific
region, sales declined by 2.0 percent (Fx adj.).

At Crop Protection, sales were lower across all product groups, especially at
Fungicides, where they fell by 40.2 percent (Fx & portfolio adj.), and at
Insecticides, where they declined by 16.9 percent (Fx & portfolio adj.). At
SeedGrowth, sales were down by 6.3 percent (Fx & portfolio adj.) year on year,
while sales at Herbicides retreated by 6.0 percent (Fx & portfolio adj.). In
contrast, sales at Seeds (which also includes the traits business) rose by 4.6
percent (Fx & portfolio adj.). Environmental Science also delivered positive
performance, with sales climbing by 20.6 percent (Fx & currency adj.), in part
due to the delivery of products to the company that acquired the consumer

EBITDA before special items of Crop Science declined by 52.2 percent to EUR 317
million (Q2 2016: EUR 663 million), in particular due to the situation in
Brazil, where Bayer recorded a substantial negative impact on earnings in the
amount of EUR 355 million in total. This figure included EUR 173 million in
provisions for product returns, EUR 53 million in impairment losses recognized
on receivables and EUR 56 million in inventory write-offs, as well as EUR 73
million in other effects. Excluding the Brazil business, earnings were up
slightly year on year.

Strong increase in earnings at Animal Health

Sales of the Animal Health business moved ahead by 2.1 percent (Fx and
portfolio adj.) to EUR 450 million (Q2 2016: EUR 426 million). The development
of business in the Asia/Pacific region was encouraging. In North America, the
Cydectin™ product portfolio that was acquired in January 2017 contributed to
sales growth on a currency-adjusted basis. Bayer once again achieved
double-digit percentage sales gains with its Seresto™ flea and tick collar (Fx
adj.: plus 17.4 percent), thanks largely to strong demand in the United States
and Europe. Sales of the Advantage™ family of flea, tick and worm control
products declined overall (Fx adj.: minus 7.7 percent), primarily due to lower
than expected demand in the United States. EBITDA before special items
increased by 16.0 percent to EUR 116 million (Q2 2016: EUR 100 million).
Positive earnings contributions resulted from price increases, the lower cost
of goods sold as well as the Cydectin™ business that Bayer acquired. These more
than offset a decline in volumes and slightly higher expenses for research and

Covestro generates significant growth in sales and earnings

Sales of Covestro in the second quarter of 2017 increased by 15.8 percent (Fx &
portfolio adj.) to EUR 3,479 million (Q2 2016: EUR 2,975 million). Selling
prices were much higher overall, especially at Polyurethanes, while volumes
matched the prior-year period overall. EBITDA before special items improved by
49.0 percent to EUR 809 million (Q2 2016: EUR 543 million). Substantially
higher selling prices more than offset the effect of increased raw material

EBITDA before special items up 8 percent in the first half of 2017

Group sales in the first half of 2017 increased by 7.4 percent (Fx & portfolio
adj.: plus 5.7 percent) to EUR 25,437 million (H1 2016: EUR 23,687 million).
EBITDA before special items advanced by 7.9 percent to EUR 6,949 million (H1
2016: EUR 6,441 million), while net income rose by 14.4 percent to EUR 3,307
million (H1 2016: EUR 2,891 million). Core earnings per share from continuing
operations came in at EUR 4.44 (H1 2016: EUR 4.42), matching the prior-year

Outlook for the full year 2017 adjusted

Due to the current business and currency development, Bayer is adjusting its
forecast for the fiscal year 2017. Its forecast for the second half is based on
the exchange rates as of June 30, 2017, including a rate of USD 1.14
(previously: USD 1.07) to the euro. Sales of the Bayer Group are now expected
to increase to more than EUR 49 billion (previously: around EUR 51 billion).
This now corresponds to a mid-single-digit (previously: mid- to
high-single-digit) percentage increase on a currency- and portfolio-adjusted
basis. EBITDA before special items is now targeted to increase by a
high-single-digit percentage (previously: low-teens percentage). The company
now aims to grow core earnings per share from continuing operations by a low-
to mid-single-digit percentage (previously: mid- to high-single-digit
percentage). Here it must be noted that Bayer's interest in Covestro amounts to
only 41 percent as of June 2017 (previously: 53 percent). Excluding capital and
portfolio measures, net financial debt is targeted to be around EUR 7 billion
at the end of 2017 (previously: around EUR 8 billion).

For its Life Science businesses, Bayer is now budgeting for sales of between
EUR 35 billion and EUR 36 billion (previously: approximately EUR 37 billion).
This corresponds to a low-single-digit percentage (previously: mid-single-digit
percentage) increase on a currency- and portfolio-adjusted basis. EBITDA before
special items is expected to come in slightly above the level of the previous
year (previously: rise by a mid- to high-single-digit percentage).

Despite negative currency development, Bayer is confirming its February
forecast for Pharmaceuticals, and continues to expect sales of more than EUR 17
billion. This corresponds to a mid-single-digit percentage increase on a
currency- and portfolio-adjusted basis. In line with its previous forecast,
Bayer aims to increase sales of its key growth products to more than EUR 6
billion, and continues to expect a high-single-digit percentage increase in
EBITDA before special items. There is no change in the company's expectation of
improving the EBITDA margin before special items.

For Consumer Health, Bayer forecasts a weak second half of the year and now
expects to generate full-year sales of about EUR 6 billion (previously: more
than EUR 6 billion). This would be in line with the prior-year level on both a
reported and a currency- and portfolio-adjusted basis (previously: low- to
mid-single-digit percentage increase on a currency- and portfolio-adjusted
basis). Meanwhile, Bayer now expects EBITDA before special items of Consumer
Health to decline by a high-single-digit percentage (previously: increase by a
low- to mid-single-digit percentage).

For Crop Science, Bayer is now budgeting sales of below EUR 10 billion
(previously: sales of more than EUR 10 billion). This corresponds to a
low-single-digit-percentage decline on a currency- and portfolio-adjusted basis
(previously: low-single-digit percentage increase). Meanwhile, Bayer now
expects the division's EBITDA before special items to decline by a mid-teens
percentage (previously: at the prior-year level).

For Animal Health, the Reconciliation and Covestro, Bayer confirms the
forecasts published in February and April 2017. This also applies to the
forecasts for the other key data.


The following tables contain the key data for the Bayer Group and its segments
for the first quarter and first half of 2017.

The interim report for the second quarter 2017 is available on the Internet at:

Supplementary features at www.investor.bayer.com:
- presentation charts for the investor conference call at 12:00 noon CEST
- live webcast of the investor conference call from approximately 2:00 p.m. CEST
- recording of the investor conference call from approximately 6:00 p.m. CEST.

Forward-looking statements

Certain statements contained in this communication may constitute "forward-
looking statements." Actual results could differ materially from those
projected or forecast in the forward-looking statements. The factors that could
cause actual results to differ materially include the following: uncertainties
as to the timing of the transaction; the possibility that the parties may be
unable to achieve expected synergies and operating efficiencies in the merger
within the expected time-frames or at all and to successfully integrate
Monsanto's operations into those of Bayer; such integration may be more
difficult, time-consuming or costly than expected; revenues following the
transaction may be lower than expected; operating costs, customer loss and
business disruption (including, without limitation, difficulties in maintaining
relationships with employees, customers, clients or suppliers) may be greater
than expected following the announcement of the transaction; the retention of
certain key employees at Monsanto; risks associated with the disruption of
management's attention from ongoing business operations due to the transaction;
the conditions to the completion of the transaction may not be satisfied, or
the regulatory approvals required for the transaction may not be obtained on
the terms expected or on the anticipated schedule; the parties' ability to meet
expectations regarding the timing, completion and accounting and tax treatments
of the merger; the impact of the refinancing of the loans taken out for the
transaction, the impact of indebtedness incurred by Bayer in connection with
the transaction and the potential impact on the rating of indebtedness of
Bayer; the effects of the business combination of Bayer and Monsanto, including
the combined company's future financial condition, operating results, strategy
and plans; other factors detailed in Monsanto's Annual Report on Form 10-K
filed with the SEC for the fiscal year ended August 31, 2016 and Monsanto's
other filings with the SEC, which are available at http://www.sec.gov and on
Monsanto's website at www.monsanto.com; and other factors discussed in Bayer's
public reports which are available on the Bayer website at www.bayer.com. Bayer
and Monsanto assume no obligation to update the information in this
communication, except as otherwise required by law. Readers are cautioned not
to place undue reliance on these forward-looking statements that speak only as
of the date.