fy / q4 2011 investor conference call presentation charts

FY/Q4 2011 ResultsInvestor Conference Call

February 28, 2012 / Marijn Dekkers, CEO

DisclaimerThis presentation may contain forward-looking statements based on currentassumptions and forecasts made by Bayer Group or subgroup management.

Various known and unknown risks, uncertainties and other factors could lead tomaterial 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 areavailable on the Bayer website at www.bayer.com.

The company assumes no liability whatsoever to update these forward-lookingstatements or to conform them to future events or developments.

• FY/Q4 2011 Investor Conference Call • Marijn Dekkers


Full Year 2011 –Record Sales And EBIT

Very good year overall, Group targets – that were raised after Q1 –achieved, proposed DPS of €1.65

Mixed business performance in Q4 – HealthCare and CropScience in line, MaterialScience below expectations

Excellent innovation pipeline progress: 4 potential blockbuster products currently launching or expected to be launched near-term at pharma, crop protection pipeline with €2bn combined peak-sales potential (2011-2015)

Continued Emerging Markets growth: 9% organic business expansion

Productivity largely improved: measures with annualized savings of €543 million implemented

Confident for 2012: Expect higher sales and earnings


4th Quarter 2011 –Mixed Business Performance

Q4‘10 Q4‘11 ∆%

€ million € million

Sales 9,012 9,191 +2 (+2)

EBITDA

- reported 1,510 1,415 -6

- adjusted 1,689 1,541 -9

EBIT

- reported 51 629 •

- adjusted 1,005 844 -16

Net income -145 397 •

NCF 1,941 1,152 -41

oFCF 1,417 427 -70

EPS

- reported -0.18 0.48 •

- core 0.95 0.97 +2

( ) = Fx & portfolio adjusted

Highlights of Financial Results

Top-line driven by ConsumerHealth andCropScience

Emerging Markets sales up 5%

Improvement of reported EBIT due tolower special charges

Adj. EBITDA declined due to a sharp drop at MaterialScience

Net cash flow impacted by payments in connection with LL Rice (€484m)

Sales adj. EBITDA

Q4‘10 Q4‘11 ∆% (adj.) Q4’10 Q4‘11 ∆%

HealthCare 4,468 4,595 +3 (+2) 1,138 1,180 +4

Pharma 2,648 2,680 +1 (+1) 771 758 -2

Consumer Health 1,820 1,915 +5 (+5) 367 422 +15

CropScience 1,653 1,676 +1 (+3) 270 273 +1

MaterialScience 2,584 2,596 0 (0) 297 106 -64In € million, ( ) = Fx & portfolio adjusted


4th Quarter 2011 – HealthCare and CropScienceIn Line, MaterialScience Below Expectations


Full Year 2011

Targets Achieved

2011 Outlookoriginal

2011actual

2011∆ Comments

Sales 4-6% to €35-36bn €36.5bn +6% Raised to 5-7% or €36-37bn

in Q1

adj. EBITDA

increase towards €7.5bn

€7.6bn +7% Raised to >€7.5bn in Q1

Core EPS Increase by~10% €4.83 +15% Raised to ~15% in Q1

Net Debt reduce €7.0bn -€0.9bn Record GCF

Full Year 2011 –All Group Targets Achieved


Sales ∆ Fx and portfolio adjusted, EBITDA pre-special items

Full Year 2011 –Subgroup Performance vs. Targets


in € million2011 Outlook

original2011

actual adj. ∆ Comments

HealthCare Targets achieved or exceeded Top-line driven by Consumer

Health Pharma margin up 140 bpts.

Sales low/mid single-digit increase

17,169 +2%

Adj. EBITDA* small improvement 4,702 +7%

CropScience

Achieved or exceeded all targetsSales ≥ mid-single digit increase 7,255 +9%

Adj. EBITDA* grow at higher rate than sales 1,654 +28%

MaterialScience Sales growth above, bottom-line clearly below expectations

Pressure from higher raw material prices and deteriorating business environment

Sales mid single-digit increase 10,832 +8%

Adj. EBITDA* grow at higher rate than sales 1,171 -14%

*Adj. EBITDA = pre-exceptional items


Full Year 2011

Significant Progress

Pharma Pipeline –2011 – Significant Progress Achieved


Project Indication Peak salespotential

Status & Targets

Xarelto Cardiology / Anticoagulation

> €2bn SPAF: launched (US, EU, others) DVT treatment and sec. prevention: launched DVT prev. ORS: launched in US Sec. prev. ACS: filed

VEGF Trap-Eye

Ophthalmology / Inhibition of bloodvessel growth

≥ €1bn Filed for wet AMD in EU and Japan Phase III for DME and wet AMD (China)

initiated Positive phase III data in CRVO

Alpharadin Oncology / Targeting of bonemetastases

≥ €1bn CR prostate cancer: 44% improvement of OS Fast track designation by FDA Filing target: mid 2012

Regorafenib Oncology / Oral multi-kinaseinhibition

≥ €1bn Metastatic colorectal cancer: 29% improvement of OS

Fast track designation by FDA Filing target: 1H 2012

SPAF: stroke prevention in atrial fibrillation; DVT: deep vein thrombosis; ORS: orthopedic surgery; ACS: acute coronary syndrome; AMD: age-related macular degeneration; DME: Diabetic macular edema

CRVO: central retina vein occlusion; CR: castration refractory; OS: overall survival

Sales in €bn from launches 2011-2015E

€2bn Peak Sales Potential withCrop Protection Pipeline 2011-2015

2011 Peak salespotential

Launches 2011–2015E*

Insecticide

Fungicide

Fungicide

Herbicide

SeedTreatment

Herbicide

Seed Treatment

Triafamone

Sivanto~ 0.2

~ 2.0

• FY/Q4 2011 Investor Conference Call • Marijn Dekkers * subject to regulatory approval


Africa & Middle East

EasternEurope

Emerging Markets –Sales Growth Well Above Global Average

Emerging Economies

EmergingEconomies¹

+9%

Others²+4%

USA+3%

Western Europe+4%

Full Year 2011 Group sales by region

Group €36,528m; +6%

~4,300

+12%~5,100

+5%

~1,800

+9%~2,100

+12%

¹ Emerging economies include: Latin America, Asia w/o Japan, Australia,New Zealand, Africa and Middle East incl. Turkey, Eastern Europe

² Others = Japan, Australia, New Zealand, Canada³ Emerging Asia = Asia w/o Japan, Australia, New Zealand

In € million, ∆% yoy Fx adjusted

36%

11%34%

19%

Latin America

Emerging Asia³


Emerging Markets –Realizing The Opportunity

Examples 2011 Fx & portfolio adjusted sales development 2011

HealthCare

Hired add. ~1,000 sales reps in China Relocated primary care headquarter to China Established 50/50 JV w. Zydus Cadila in India In-licensed Tedizolid antibiotic from Trius for

several EM markets, incl. China

+10%

CropScience Opened new “seed treatment application

center” in Brazil Approval of LibertyLink soybean, Argentina

+11%

MaterialScience Opened new world-scale TDI plant in China

with innovative gas-phase phosgenation Moved polycarbonates headquarters to China

+7%

Restructuring Program Fully On Track


Target: €800m annual cost savings by 2013

Reinvestment of ~50%

One-time-charges of approx. €1bn of which €803m booked in 2010/11

Plans include staff reductions of 4,500

2,500 new hires in growth and innovation, particularly in emerging markets

Measures with €543m annualizedsavings already implemented by endof 2011

CropScience

HealthCareHolding & Admin.

~54%

34%

~12%

€800m

Contribution by Subgroup


Full Year 2012

Financial Outlook

Outlook 2012 –Planning Assumptions


2.6

0.7

1.7

3.3

4.8

in % vs previous year

4

3

2

1

5.15

Global economic/political risks remain high

Outlook for economic growth marked by uncertainty

Positive signals for North America, in Europe we expect slower expansion in 2012 than 2011

Asian emerging markets continue to drive growth

$/€ 1.40, 1% appreciation of Euro lowers sales by ~€76m and EBITDA by ~€23m

Crude oil: average $110/bbl

GDP growth by regions

Outlook 2012 –Planning Assumptions


Expected 2012 Global Market Development

5% Electro/electronicRobust growth

27% Rx-pharmaMid-single digit growth, driven by emerging markets

10% OTC-pharmaLow- to mid-single digit growth

3% Diabetes carelow-single digit growth

3% Animal HealthModerate growth

20% Agrochemicals/SeedsPositive development

6% AutomotiveRobust growth

6 % ConstructionOngoing recovery

5% Furniture/woodOngoing recovery,small growth

15% Others

2011 Group sales break-down in %


2011 ∆ vs. 2010 2012E

Sales(Fx & portf. adjusted)

€36.5bn +6% +~3% or~€37bn*

adj. EBITDA €7.6bn +7% Slightly improve

Core EPS €4.83 +15% Slightly improve


Full Year 2012 Outlook Projects Further Growth And Higher Earnings

*Assuming Fx rate of $1.40 per €Outlook depends on specific planning assumptions

as detailed in the Annual/ Quarterly Report


HealthCare Expect sales to increase by low- to mid-single-digit percentage. Plan to slightly improve adj. EBITDA .

Pharma Expect sales to remain stable or move slightly higher, and adj. EBITDA to approx. match prior year level.

Consumer Health

Anticipate mid-single-digit percentage growth of sales and adj. EBITDA.

CropScience Plan to grow above market and to increase sales and adj. EBITDA by mid-single-digit percentages.

MaterialScience

Expect sales and adj. EBITDA to remain level with prior year. Should market develop more favorably than anticipated, we expect sales and earnings to increase accordingly. Q1’12: Expect sales to be roughly level with Q4’11 and adj. EBITDA to be well above Q4’11 but below Q1’11.

Full Year 2012 –Guidance By Subgroup

Outlook depends on specific planning assumptionsas detailed in the Annual/ Quarterly Report



Full Year 2012 –R&D And CapEx Budgets

1%

MaterialScience0.2bn

HealthCare2.0bnthereof Pharma1.5bn

MaterialScience0.5bn

HealthCare0.5bn

Reconciliation0.05bn

67%

24%

8%

Reconciliation0.2bn

CropScience0.8bn

CropScience0.3bn

CapEx (PPE) 2012e: ~€1.5bnR&D 2012e: ~€3.0bn

25%

66%

8% 34%

20%

33%

13%

FY/Q4 2011 ResultsInvestor Conference Call

February 28, 2012 / Marijn Dekkers, CEO

fy / q4 2011 investor conference call presentation charts

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