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Bayer CropScience Q2 profit rises 9% to Rs 166 crore despite 19% decline in revenue

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In short

Bayer CropScience navigated an uneven monsoon, reduced corn acreage, and softer demand for crop protection products during the second quarter. The business countered these severe market headwinds by curbing total operational expenses to protect its profit margins. However, high corn seed production alongside subdued demand raised inventory levels and market liquidity issues marginally stretched receivables. The board demonstrated confidence by declaring an interim dividend of Rs 90 per equity share.

Key points

  • Disciplined expense management and strong corn seed yields protected earnings despite dec…: Disciplined expense management and strong corn seed yields protected earnings despite declining top-line revenues.
  • Soft agricultural demand and production volumes led to higher inventory alongside slightl…: Soft agricultural demand and production volumes led to higher inventory alongside slightly delayed customer collections.
  • The company rewarded shareholders with an interim dividend totaling Rs 404.5 crore for th…: The company rewarded shareholders with an interim dividend totaling Rs 404.5 crore for the fiscal year.

Sources checked by our analysis pipeline: 1

The agrochemicals and seeds maker had posted a net profit of Rs 152.7 crore in the year-ago period, the company said in a statement.

Total income declined 19.4 per cent to Rs 1,250.7 crore in the September quarter from Rs 1,553.4 crore a year earlier. Expenses fell to Rs 1,052.7 crore from Rs 1,366.9 crore.

"Q2 reflected a challenging operating environment, with an uneven monsoon affecting sowing patterns and crop protection demand, alongside lower corn acreages," said Simon Wiebusch, Vice Chairman, Managing Director and CEO.

He said the company stayed focused on disciplined execution, strengthening its portfolio and scaling new innovations.

"As Indian agriculture navigates increasing volatility, our priority is to help farmers improve productivity and resilience by bringing together innovations and partnerships across the agricultural ecosystem, while building a stronger and more sustainable business for the long term," Wiebusch added.

Executive Director and CFO Vinit Jindal said profit after tax increased 9 per cent in Q2 and 13 per cent in the first half, supported by improved gross margins reflecting favourable production yields for corn seeds and cost efficiencies.

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