(Bloomberg) -- Bayer AG tumbled the most in a year after reporting a weak first quarter and paring forecasts, marking an unsettling end to the stormy tenure of departing Chief Executive Officer Werner Baumann. 

The German conglomerate had anticipated core earnings per share for the year in the range of €7.20 to €7.40. It now expects to hit the lower end of its range, Baumann said in a statement. Bayer shares fell as much as 7.9% in Frankfurt.

The balancing act often seen between Bayer’s various units — with strength at one offsetting weakness at another — failed to materialize for the quarter, setting up a challenge for Bill Anderson, Baumann’s successor as CEO.

A sales drop in China held pharmaceutical revenue short of expectations. Meanwhile, the company cut its forecast for the crop science unit, citing rapidly dropping prices for glyphosate, a key ingredient in controversial weedkiller Roundup.

The quarterly results mark the end of a tumultuous seven years for Baumann, who steps down later this month. He spearheaded the $63 billion takeover of Monsanto within weeks of taking over as CEO, bolstering Bayer’s agriculture division but saddling it with an image problem and huge legal headaches in the US. The stock is down about 45% on his watch.

The results were “a weak start to the year,” James Quigley, an analyst at Morgan Stanley, wrote in a note to clients. 

The first quarter was expected to be a difficult one for Bayer due to the drop in glyphosate prices, which were booming a year earlier. Core earnings dropped 16% to €2.95 per share. 

Bayer said sales in the crop science unit will grow about 1.5% this year, less than the 3% the company had predicted in February. The margin for earnings before interest, taxes, depreciation and amortization excluding some items will be 25%, the company said, compared with the 25% to 26% it had predicted. 

Revenue fell to €14.4 billion, roughly in line with estimates. Sales of Bayer’s herbicides plunged by almost a quarter as both the price and the amount of glyphosate sold dropped.

Cuts Planned

Bayer will seek to cut costs by €700 million to €800 million this year, about €200 million more than the figure it previously announced, Baumann said on a conference call with analysts.  

Payouts for lawsuits surrounding glyphosate, weedkiller dicamba and birth control device Essure weighed on free cash flow, which dropped to a negative €4.1 billion. Bayer spent €1.54 billion on settlements. It had already made provisions for the payouts.

Anderson, a drug industry veteran and former chief of Roche Holding AG’s pharmaceutical unit, officially takes over as CEO on June 1. Bayer’s pharma division is relatively small and facing a new era of competition for aging blockbuster medicines Eylea, an eye treatment, and Xarelto, a blood thinner. Revenue from top seller Xarelto dropped 13% last quarter, missing estimates as Covid-19’s surge in China hampered demand.

--With assistance from Veronika Gulyas.

(Updates with CEO comment in the 10th paragraph)

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