1.2 Corporate Structure

Corporate structure in 2015

Until December 31, 2015, Bayer AG, headquartered in Leverkusen, Germany, served as a strategic management holding company, defining common values, goals and strategies for the entire Bayer Group. It was also responsible for resource allocation and managerial appointments. Under its direction, the three subgroups – HealthCare, CropScience and Covestro (formerly MaterialScience) – conducted their business operations on their own responsibility in line with predefined goals, supported by three service companies. Following the signing of a sales agreement with Panasonic Healthcare Holdings, Ltd. on June 8, 2015, the Diabetes Care business is no longer reported under Continuing operations Revenue and earnings reporting for continuing operations pertains only to business operations that are expected to remain in the company’s portfolio for the foreseeable future; opposite of discontinued operations. .

Bayer Group Structure 2015

Bayer Group Structure (organigram)Bayer Group Structure (organigram)
Key Data by Subgroup and Segment

 

 

Sales

 

EBIT

 

EBITDA before special items1

 

 

2014

2015

 

2014

2015

 

2014

2015

 

 

€ million

€ million

 

€ million

€ million

 

€ million

€ million

2014 figures restated

1

For definition see Chapter 14.2 “Calculation of EBIT(DA) Before Special Items.”

HealthCare

 

19,075

22,874

 

3,470

4,050

 

5,357

6,419

Pharmaceuticals

 

12,052

13,745

 

2,371

2,807

 

3,699

4,195

Consumer Health

 

7,023

9,129

 

1,099

1,243

 

1,658

2,224

CropScience

 

9,494

10,367

 

1,806

2,103

 

2,360

2,416

Covestro

 

11,651

11,982

 

555

635

 

1,187

1,659

Reconciliation

 

1,119

1,101

 

(436)

(538)

 

(219)

(228)

Group

 

41,339

46,324

 

5,395

6,250

 

8,685

10,266

In 2015, the Bayer Group comprised 307 consolidated companies in 77 countries throughout the world.

New corporate structure effective 2016

With the company’s focus now on the Life Science businesses, a new organizational structure was introduced effective January 1, 2016. The company’s operations are now managed in three divisions – Pharmaceuticals, Consumer Health and Crop Science – and the Animal Health business unit. The former Bayer HealthCare subgroup has been dissolved. The Radiology and Pharmaceuticals businesses have been merged to form the Pharmaceuticals Division. The Consumer Health Division now consists entirely of the consumer care business. Animal Health has become a separate reporting segment. The Bayer CropScience subgroup is now the Crop Science Division. The former MaterialScience subgroup, renamed Covestro, became legally and economically independent on September 1, 2015. Covestro AG was floated on the stock market on October 6, 2015. Bayer currently still owns around 69% of Covestro AG. Covestro therefore remains a reporting segment of the Bayer Group because Bayer AG continues to exercise control.

Effective January 1, 2016, the Board of Management of Bayer AG was enlarged to include the heads of the new Pharmaceuticals, Consumer Health and Crop Science divisions. The business continues to be supported by Business Services and Currenta, while Technology Services is being integrated into Bayer AG, forming the Engineering & Technology function.

Bayer Group Structure in 2016

Bayer Group Structure in 2016 (organigram)Bayer Group Structure in 2016 (organigram)
Pro Forma Key Data by New Segment

 

 

Sales

 

EBIT

 

EBITDA before special items1

 

 

2014

2015

 

2014

2015

 

2014

2015

 

 

€ million

€ million

 

€ million

€ million

 

€ million

€ million

1

For definition see Chapter 14.2 “Calculation of EBIT(DA) Before Special Items.”

2

Reconciliation includes the Business Services and Currenta service companies (“Other segments”) as well as the corporate functions and consolidation effects.

3

Including service companies

Pharmaceuticals

 

13,512

15,308

 

2,627

3,027

 

4,081

4,615

Consumer Health

 

4,245

6,076

 

609

769

 

991

1,456

Crop Science

 

9,494

10,367

 

1,806

2,103

 

2,360

2,416

Animal Health

 

1,318

1,490

 

234

254

 

285

348

Reconciliation2

 

1,119

1,101

 

(436)

(538)

 

(219)

(228)

Total Life Sciences3

 

29,688

34,342

 

4,840

5,615

 

7,498

8,607

Covestro

 

11,651

11,982

 

555

635

 

1,187

1,659

Group

 

41,339

46,324

 

5,395

6,250

 

8,685

10,266

The Pharmaceuticals Division focuses on prescription products, especially for cardiology and women’s healthcare, and on specialty therapeutics in the areas of oncology, hematology and ophthalmology. The division also comprises the radiology business, which markets diagnostic imaging equipment together with the necessary contrast agents.

The Consumer Health Division markets mainly nonprescription products in the dermatology, dietary supplement, analgesic, gastrointestinal, cold, allergy, sinus and flu, foot care, sun protection and cardiovascular risk prevention categories. These products include globally known brands such as Claritin™, Aspirin™, Aleve™, Bepanthen™ / Bepanthol™, Canesten™, Dr. Scholl’s™[1] and Coppertone™.

The Crop Science Division has businesses in seeds, crop protection and nonagricultural pest control. It is organized into two operating units: Crop Protection / Seeds and Environmental Science. Crop Protection / Seeds markets a broad portfolio of high-value seeds along with innovative chemical and biological pest management solutions, while at the same time providing extensive customer service for modern and sustainable agriculture. Environmental Science focuses on nonagricultural applications, with a broad portfolio of pest control products and services designed for applications ranging from the home and garden sector to forestry.

The Animal Health Business Unit offers products and services for the prevention and treatment of diseases in companion and farm animals.

The corporate functions and Business Services operate as Group-wide competence centers in which business support services are bundled. Currenta is the service company responsible for managing and operating the Chempark sites in Leverkusen, Dormagen and Krefeld-Uerdingen.

Covestro is a leading supplier of high-tech polymer materials and develops innovative product solutions for a wide variety of everyday uses.

1 Trademark rights and distribution only in certain countries outside the European Union