Bayer AG - Stockholders' Newsletter Third Quarter 2007

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Financial Statements

Bayer Group Consolidated Statements of Income

	3rd Quarter 2006	3rd Quarter 2007	First Nine Months 2006	First Nine Months 2007
€ million
Net sales	7,459	7,793	20,986	24,345
Cost of goods sold	(3,974)	(3,978)	(10,983)	(12,184)
Gross profit	3,485	3,815	10,003	12,161

Selling expenses	(1,715)	(1,916)	(4,522)	(5,642)
Research and development expenses	(669)	(640)	(1,522)	(1,915)
General administration expenses	(407)	(418)	(1,137)	(1,279)
Other operating income	65	219	440	590
Other operating expenses	(129)	(383)	(706)	(1,146)
Operating result (EBIT)	630	677	2,556	2,769

Equity-method loss	(3)	(9)	(14)	(36)
Non-operating income	206	113	500	545
Non-operating expenses	(470)	(370)	(1,191)	(1,250)
Non-operating result	(267)	(266)	(705)	(741)

Income before income taxes	363	411	1,851	2,028

Income taxes	(109)	769	(584)	221

Income from continuing operations after taxes	254	1,180	1,267	2,249

Income (loss) from discontinued operations after taxes	66	(2)	105	2,396

Income after taxes	320	1,178	1,372	4,645
of which attributable to minority interest	0	3	0	1
of which attributable to Bayer AG stockholders (net income)	320	1,175	1,372	4,644

Earnings per share (€)
From continuing operations
Basic*	0.34	1.46	1.68	2.82
Diluted*	0.34	1.46	1.68	2.82
From continuing and discontinued operations
Basic*	0.42	1.46	1.82	5.73
Diluted*	0.42	1.46	1.82	5.73