Overview of Business Performance

Economic Environment

Global economic growth matches prior-year level

The pace of global economic growth in 2018 matched the level of the previous year. In the United States, tax cuts in particular helped the economy perform considerably better than in 2017. In Europe, however, economic growth slowed, hampered in part by the uncertainty surrounding the form of the United Kingdom’s exit from the European Union. In Germany, economic growth declined significantly, primarily due to weaker exports. The Chinese economy continued to grow rapidly, though at a reduced pace compared with the previous year. By contrast, the overall growth of the Emerging Markets was level with the prior year.

Economic Environment

 

 

Growth1 2017

 

Growth1 2018

2017 figures restated

1

Real GDP growth, source: IHS Markit

2

Including about 50 countries defined by Global Insight as Emerging Markets in line with the World Bank
As of January 2019

World

 

+3.3%

 

+3.2%

European Union

 

+2.6%

 

+2.0%

of which Germany

 

+2.5%

 

+1.5%

United States

 

+2.2%

 

+2.9%

Emerging Markets2

 

+4.9%

 

+4.8%

Currency development

Negative currency effects diminished sales of the Bayer Group by €1,464 million (−4.1%) and EBITDA before special items by €457 million in 2018. These currency effects do not include those relating to the acquired business. The effects pertained to the currencies shown in the following table.

Currency Development Bayer Group

 

 

2017

 

2018

 

Delta Fx effect on sales

 

Delta Fx effect on clean EBITDA

 

Of which delta Fx effect from hedging

 

 

€ million

 

€ million

 

€ million

 

€ million

 

€ million

Source: Bloomberg, annual average closing rates

ARS

 

18.53

 

30.95

 

(135)

 

31

 

0

BRL

 

3.59

 

4.29

 

(115)

 

11

 

(20)

CAD

 

1.46

 

1.53

 

(95)

 

(38)

 

26

CNY

 

7.61

 

7.80

 

(76)

 

(49)

 

(10)

JPY

 

126.39

 

130.38

 

(68)

 

(46)

 

(14)

MXN

 

21.28

 

22.69

 

(44)

 

(24)

 

2

RUB

 

65.71

 

73.87

 

(100)

 

(21)

 

45

TRY

 

4.10

 

5.56

 

(123)

 

(69)

 

0

USD

 

1.13

 

1.18

 

(401)

 

(116)

 

(40)

Other currencies

 

 

 

 

 

(307)

 

(136)

 

8

All currencies

 

 

 

 

 

(1,464)

 

(457)

 

(3)

Compare to Last Year