PRESS RELEASE
from SARTORIUS STED BIO (EPA:DIM)
Sartorius Stedim Biotech publishes unaudited first quarter results for 2024
Sartorius Stedim Biotech SA / Key word(s): Quarter Results Sartorius Stedim Biotech publishes unaudited first quarter results for 2024
In a continuously challenging market environment, Sartorius Stedim Biotech, a leading partner of the biopharmaceutical industry, closed its first quarter largely within the bandwidth of expectations recording an increase in order intake and a decline in sales revenue compared with a significantly stronger prior-year period. For the full year, the company continues to anticipate business momentum to gradually pick up from quarter to quarter and forecasts sales revenue growth in the mid to high single-digit percentage range. “Overall, the first three months showed the projected continued recovery, however the dynamics across our portfolio and regions were mixed. Demand continued to normalize particularly in our recurring core business with consumables, where orders are picking up, signaling that customers have made further progress in destocking. In addition, it is encouraging to see that the business with cell and gene therapy customers, a major strategic focus point, has continued to perform strongly. On the other hand, customer investment into hardware and systems remained muted, especially in China and to some extent also in Europe, which led to soft development in our equipment business. In terms of profitability, we achieved a robust EBITDA margin, and our ongoing efficiency programs should deliver further benefits later in the year,” said René Fáber, CEO of Sartorius Stedim Biotech. Business development1 In the first quarter of the fiscal year, Sartorius Stedim Biotech recorded an increase in order intake1 of 13.9 percent in constant currencies (reported: 12.5 percent) to 676 million euros, with growth coming from all regions except China. In view of advanced inventory reductions on the part of customers, business has been recovering since the end of the third quarter of 2023. Order volume was slightly above sales revenue in the first three months of 2024, which stood at 667 million euros, down 6.7 percent in constant currencies (organic: - 9.4 percent; reported: - 8.2 percent) compared with the prior-year period’s strong figure. This includes a growth contribution from acquisitions2 of 2.7 percentage points. From a regional perspective, the normalization of demand was visible in all business regions: The EMEA3 region recorded an increase in order intake of 8.6 percent with sales revenue down by 3.8 percent. In the Americas region, order intake grew at a double-digit rate of 29.4 percent, while sales revenue declined by 8.6 percent. In Asia/Pacific, order intake increased by 3,2 % in constant currencies, while the continued market weakness in China led to a decline in sales revenue (- 8.8 percent). Underlying EBITDA decreased by 13.2 percent to 191 million euros in the first three months, with positive product mix effects and cost base adjustments partially compensating the negative volume development. The EBITDA margin reached 28.6 percent (prior-year period: 30.3 percent). Underlying net profit1 was 84 million euros, compared with 131 million euros in the first quarter of 2023. Net profit amounted to 56 million euros against 111 million euros in the previous year’s period. Underlying earnings per share stood at 0.86 euros (prior-year period 1.43 euros) and earnings per share at 0.58 euros (prior-year period: 1.21 euros). The number of employees worldwide was 10,493 as of March 31, 2024, after 11,581 in the prior-year quarter (December 31, 2023: 10,662 people). Key financial indicators Sartorius Stedim Biotech’s key financial indicators remain at a sound level. Equity was 3,867 million euros as of March 31, 2024, while the equity ratio1 increased to 45.8 percent (December 31, 2023: 2,673 million euros and 34,5 percent, respectively), mainly as a result of the equity measures successfully completed at the beginning of February 2024. Gross debt was down to 3,189 million euros (December 31, 2023: 3,682 million euros) and net debt down to 2,494 million euros, resulting in a reduced ratio of net debt to underlying EBITDA1 of 3.3 (December 31, 2023: 3,565 million euros and 4.5 respectively). Mainly due to lower earnings, net operating cash flow totaled 55 million euros, compared with 166 million euros in the prior-year period. Cash flow from investing activities amounted to - 109 million euros after - 116 million euros in the first quarter of 2023. The ratio of capital expenditures (capex) to sales revenue was 16.4 percent compared with 16.0 percent in the prior-year period. Outlook for fiscal 2024 Management confirms its expectations for the current fiscal year and continues to anticipate a moderate first half of 2024 and increasing business momentum in the course of the year. In addition, business performance could also be affected by increasing geopolitical tensions and economic slowdowns. Accordingly, consolidated Group sales revenue is projected to increase in the mid to high single-digit percentage range, including a contribution of around 2 percentage points from acquired businesses. In terms of profitability, management anticipates a rise in the underlying EBITDA margin to more than 30 percent compared with the previous year’s figure of 28.3 percent. The above-average profitability of the Polyplus business should have a slightly positive effect on the margin development. The ratio of capital expenditure to sales revenue is expected to be around 13 percent (prior year: 17.1 percent), and the ratio of net debt to underlying EBITDA1 slightly below 2.5. Forecasts have been prepared based on historical information and are consistent with accounting policies. All forecast figures are based on constant currencies, as in the past years. Management points out that the dynamics and volatilities in the industry have increased significantly in recent years. In addition, uncertainties due to the changed geopolitical situation, such as the emerging decoupling tendencies of various countries, are playing a greater role. This results in higher uncertainty when forecasting business figures. 1 Sartorius Stedim Biotech publishes alternative performance measures that are not defined by international accounting standards. These are determined with the aim of improving the comparability of business performance over time and within the industry.
3 EMEA = Europe, Middle East, Africa This press release contains forward-looking statements about the future development of the Sartorius Stedim Biotech Group. Forward-looking statements are subject to known and unknown risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by such statements. Sartorius Stedim Biotech assumes no liability for updating such statements in light of new information or future events. Sartorius Stedim Biotech shall not assume any liability for the correctness of this release. The original French press release is the legally binding version. Conference call Dr. René Fáber, CEO of the Sartorius Stedim Biotech Group, will discuss the company’s first quarter results with analysts and investors in a conference call at 1.00 p.m. CEST on April 18, 2024. Register here: https://sar.to/Q1_IR_SSB_Registration Financial calendar July 19, 2024 Publication of the first-half figures (January to June 2024) October 17, 2024 Publication of the nine-month figures (January to September 2024) Key Performance Indicators for the First Quarter of 2024
1 cc = constant currencies: Figures given in constant currencies eliminate the impact of changes in exchange rates by applying the same exchange rate for the current and the previous period 2 All customer orders contractually concluded and booked during the respective reporting period 3 According to customer location 4 Underlying EBITDA = earnings before interest, taxes, depreciation and amortization, and adjusted for extraordinary items 5 Relevant / underlying net profit = net profit after non-controlling interest; adjusted for extraordinary items and amortization, as well as based on a normalized financial result and normalized tax rate 6 After non-controlling interest Figures are not audited nor reviewed. Reconciliation
Figures are not audited nor reviewed.
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