First-quarter results 2022 of Sartorius Stedim Biotech

Sartorius Stedim Biotech, a leading partner of the biopharma industry, recorded a dynamic start to fiscal 2022, with sales revenue and earnings posting strong double-digit growth rates in the first quarter compared with the prior-year period. Based on its performance in the first three months, Sartorius Stedim Biotech confirms its outlook for fiscal 2022.

“Sartorius Stedim Biotech had a good start to 2022. We continued to grow, and our margin remained at a high level despite rising logistics and material costs as well as negative influences from currencies. The pandemic-related effects and the development of order intake are normalizing, as expected. Demand for our products is high in all segments and our investments in the expansion of production capacities are making good progress. In addition, the acquisition of the chromatography business of Novasep further strengthened our positioning in downstream processing. In light of the positive performance in the first three months and the healthy demand situation, we are confirming our outlook for the current fiscal year. However, the global political and economic uncertainties have increased substantially with the outbreak of war in Ukraine, further increasing the strain on supply chains and the risks arising from significantly higher inflation rates,” said Joachim Kreuzburg, Chairman of the Board of Directors and CEO.

Business development of the Group¹

In the first quarter, Group sales revenue rose by 27.6 percent year-over-year in constant currencies (reported: +31.6 percent) to around 862 million euros. The performance was driven by strong organic growth across the portfolio, while acquisitions² contributed almost 2 percentage points to the increase. All three business regions – EMEA³, Americas, and Asia | Pacific – posted double-digit percentage growth in constant currencies.

Order intake was in line with expectations compared with the exceptionally strong prior-year quarter, reaching 950 million euros (- 8.6 percent in constant currencies; reported: - 5.5 percent). The first quarters of 2021 were influenced by extraordinarily high demand related to the coronavirus pandemic and changed ordering patterns by some customers, who placed their orders further in advance than usual.

As a result from the growth in sales revenue, underlying EBITDA rose by 31.1 percent to 304 million euros in the first quarter. The corresponding margin remained largely stable at 35.2 percent (prior-year quarter: 35.4 percent) despite being impacted by negative currency effects. Relevant net profit rose 34.4 percent to 203 million euros, and underlying earnings per share were 2.21 euros (prior-year quarter: 1.64 euros).

Key financial indicators

The Sartorius Stedim Biotech Group continues to have a very sound balance sheet and financial base. As of March 31, 2022, its equity ratio stood at 48.1 percent (December 31, 2021: 43.9 percent). Net debt to underlying EBITDA remained at 0.4 percent, as at year-end 2021. Cash flow from investing activities stood at –77 million euros as planned, compared to –62 million euros in the first quarter of 2021. The ratio of capital expenditures (CAPEX) to sales revenue reached 8.9 percent, compared with 9.5 percent in the prior-year period.

Increase in the number of employees

As of March 31, 2022, Sartorius Stedim Biotech employed a total of 11,400 people worldwide, representing a headcount increase of 991 from the end of December 2021.

Outlook for fiscal 2022 confirmed

The management confirms the outlook for the current fiscal year. Consolidated sales revenue is expected to increase by about 15 percent to 19 percent, with non-organic growth from acquisitions projected to contribute about 2 percentage points. The company’s underlying EBITDA margin is expected to reach more than 35 percent this year.

The CAPEX ratio is anticipated to be about 14.5 percent and net debt to underlying EBITDA to be about 0.2 at year-end. Possible further acquisitions are not included in this projection.

All forecasts are based on constant currencies, as in the past years. In addition, management points out that the dynamics and volatilities in the life science and biopharma sectors have increased over the past years and the coronavirus pandemic has further amplified these trends. Accordingly, current forecasts show even higher uncertainties than usual. Furthermore, the forecasts are based on the assumption of no further deterioration in the geopolitical and global economic situation, supply chains and inflation, and no new large-scale restrictions in connection with the coronavirus pandemic.

_{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.}

_{- Order intake: all customer orders contractually concluded and booked during the respective reporting period}

_{- Underlying EBITDA: earnings before interest, taxes, depreciation and amortization and adjusted for extraordinary items}

_{- Relevant net profit: profit for the period after non-controlling interest, adjusted for extraordinary items and non-cash amortization, as well as based on the normalized financial result and the normalized tax rate}

_{- Ratio of net debt to underlying EBITDA: quotient of net debt and underlying EBITDA over the past 12 months, including the pro forma amount contributed by acquisitions for this period}

_{2 Acquisition of CellGenix, Xell and the Novasep chromatography division}

_{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.}