Report on Expected Developments

With the publication of the results of fiscal 2012 on March 7, 2013, Merck provided qualitative guidance on the expected sales and results of its divisions and the Group for 2013.

For the markets of relevance to the Merck Serono division, Merck sees global growth, which is likely to be fueled mainly by Emerging Markets, whereas developments in Europe will probably continue to be impacted by health care cost-containment measures.

The market environment of Consumer Health should see global growth in the mid single-digit range, with Europe also growing at the same rate. Asia and Latin America could see high single-digit growth rates.

The markets in which Performance Materials operates are also expected to grow. Owing to increasing television display diagonals, as well as good demand for tablet computers, the display industry should grow by volumes. However, analyses of the inventory situation in the display industry point to inventory build-ups in recent quarters; the reduction of which is a realistic expectation for the coming quarters. This will also impact Merck’s Liquid Crystals business unit. A low single-digit increase is projected for the global automotive industry, which is a key market for the products supplied by Pigments & Cosmetics business unit.

With respect to the markets in which Merck Millipore operates, low single-digit growth is projected for Pharmaceuticals and Laboratory Products, whereas mid single-digit growth is forecasted for Biotechnology.

Based on these assumptions as well as the good business developments in terms of both sales and earnings in the past months, Merck expects that the guidance for 2014 issued in May 2012 will already be achieved in 2013, meaning one year ahead of time. This leads to the following detailed forecast for the financial performance of the divisions and the Merck Group:

FX assumptions for FY 2013:

1 € = 1.30 US$
1 € = 1.20 CHF
1 € = 125 JPY