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    DIM   FR0013154002

SARTORIUS STEDIM BIOTECH

(DIM)
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Sartorius Stedim Biotech : Half-Year Report H1|2021

07/21/2021 | 03:59am EST

Sartorius Stedim Biotech

First-Half Financial Report Key Figures for the First Half and Second Quarter of 2021 1

Key Figures for the First Half and Second Quarter of 2021

in millions of € unless otherwise specified

6 months 2021

6 months 20201

in %

in % cc2

Order Intake and Sales Revenue

Order intake

1,889.9

1,048.7

80.2

87.4

Sales revenue

1,351.9

869.1

55.6

61.1

EMEA3

580.1

340.3

70.5

71.3

Americas3

419.8

312.6

34.3

46.1

Asia | Pacific3

352.0

216.2

62.8

66.1

Results

EBITDA4

487.4

262.3

85.8

EBITDA margin4 in %

36.1

30.2

Net profit5

321.4

167.4

91.9

Earnings per share5 in €

3.49

1.82

91.9

June 30, 2021

Dec. 31, 2020

Balance Sheet| Financials

Balance sheet total

3,521.9

3,065.5

Equity

1,693.1

1,482.9

Equity ratio in %

48.1

48.4

Net debt

355.2

527.3

Ratio of net debt to underlying EBITDA

0.4

0.8

in millions of € unless otherwise specified

Q2 20216

Q2 20201,6

in %

in % cc2

Order Intake and Sales Revenue

Order intake

885.5

514.0

72.3

78.7

Sales revenue

696.7

447.0

55.9

61.1

EMEA3

296.0

172.7

71.4

Americas3

215.8

159.9

35.0

Asia | Pacific3

184.9

114.4

61.6

Results

EBITDA4

255.8

135.6

88.6

EBITDA margin4 in %

36.7

30.3

Net profit5

170.2

86.8

96.2

Earnings per share5 in €

1.85

0.94

96.2

1 The previous year's figures have been restated due to finalization of the purchase price allocations for acquisitions of 2020 2 cc = in constant currencies

3 According to customer location

4 Underlying EBITDA = earnings before interest, taxes, depreciation and amortization, and adjusted for extraordinary items

5 Underlying net profit = net profit after non-controlling interest; adjusted for extraordinary items, amortization and based on a normalized financial result and normalized tax rate

6 Figures are not audited nor reviewed

Sartorius Stedim Biotech

First-Half Financial Report Sector Environment 2

Sector Environment

The Sartorius Stedim Biotech Group serves customers mainly in the biopharmaceutical industry. Thus, the development of this sector provides important impetus to the Group's business performance.

Biopharmaceutical Market Grows Considerably - Pandemic Leads to Additional Demand for Manufacturers of Bioprocess Technology

In 2020, the period to which the most recent data available refers, estimates published by EvaluatePharma show that, despite the global recession, growth in the global pharmaceutical market was almost at prior-year levels, increasing approximately 3% to 4%. Sales of biotechnologically manufactured drugs and vaccines in particular continued to grow faster than the market as a whole, by around 7%, to approximately €247 billion.

Sales revenue growth of providers of technologies for the development and production of biopharmaceuticals was especially buoyant in 2020. This was attributable to the continuing good performance of the core business and strong additional demand fueled by the ramp-up of production capacity for coronavirus vaccines and Covid-19 therapeutics. Given the large investment of resources and considerable governmental and private sector cooperation, many drug candidates progressed through the various phases of development at a record pace. This has since then resulted in the market approval of more than 30 vaccines and anti- coronavirus compounds. The demand associated with the research activities and expanding commercial production again resulted in very positive business performance for providers of bioprocess technology in the first half of 2021.

The growth of the biopharma market fundamentally depends more on medium- to long-term trends than on short-term economic developments. In addition to the market launch of innovative biopharmaceuticals, significant impetus is provided by the world's rising demand for medications as well as the expanded range of indications for approved medicines and their further market penetration. A growing number of active substances manufactured using biotech production methods is being approved for the treatment of rare illnesses that have been incurable so far. In the process, the pharmaceutical industry is increasingly concentrating on advanced therapies, such as gene and cell therapies and biotechnologically processed tissue products. The approval process for new medications relies on the performance of clinical studies. In 2020, over 1,000 clinical studies had to be suspended or their scheduled start delayed as a result of the coronavirus pandemic. A similarly high number of studies was again suspended in the first half of 2021. This development could lead to the delayed approval of new drugs in the future.

Sources: BioPlan: 17th Annual Report and Survey of Biopharmaceutical Manufacturing Capacity and Production, April 2020; Daedal

Research: Global Biologics Market: Size, Trends & Forecasts, December 2020; IQVIA Institute: Global Medicine Spending and Usage

Trends, March 2020; Evaluate Pharma: World Preview 2020, Outlook to 2026, July 2020

Sartorius Stedim Biotech

First-Half Financial Report Group Business Development 3

Group Business Development

  • Sartorius Stedim Biotech with uptick in sales revenue and earnings and exceptionally high order intake
  • Dynamic organic growth; added momentum from pandemic-related business and acquisitions
  • Forecast for 2021 raised once again at the beginning of July

Sartorius Stedim Biotech has continued on its fast growth trajectory, closing the first half of 2021 with significant double-digit increases in both sales revenue and order intake. Based on constant currencies, Group sales revenue rose 61.1% to €1,351.9 million; the reported increase was 55.6%. The majority of this growth was generated through strong organic expansion in all regions and is based on unabated high demand for innovative technologies used in the development and production of biopharmaceuticals, both in the area of classic monoclonal antibodies and in the emerging fields of cell and gene therapies. In addition to solid performance by its core business, Sartorius Stedim Biotech benefited from the ramp-up in coronavirus vaccine production by many manufacturers. The pandemic-related businesses contributed around 26 percentage points, while acquisitions added around 6 percentage points to the growth in sales revenue. Order intake grew even more dynamically, rising to €1,889.9 million (+87.4% in constant currencies of which a good 31 percentage points were attributable to the coronavirus pandemic and around 9 percentage points to acquisitions; reported: +80.2%). Part of this higher order intake was due to adapted ordering patterns of some customers who in the current situation have been placing their orders further in advance than usual.

It should be noted that the comparative base for these high growth figures is a relatively modest prior-year period, which did not yet include any substantial pandemic-related business. In fact, the demand for technologies for developing and producing coronavirus vaccines and Covid-19 therapeutics started to gain momentum in the second half of 2020. Moreover, the above-mentionednon-organic contributions to growth must be considered in a year-over-year comparison.

Against the backdrop of this dynamic business performance, the strong order situation, and expanded production capacity, Sartorius Stedim Biotech`s management again raised the forecast for the full-year. The company now expects sales revenue growth of around 48% based on constant currencies (previously around 38%) and an underlying EBITDA margin of about 36% (previously about 34%).

in millions of €

6 months 2021

6 months 2020

in %

in % cc1

Order intake

1,889.9

1,048.7

80.2

87.4

Sales revenue

1,351.9

869.1

55.6

61.1

1 cc= in constant currencies

Sartorius Stedim Biotech increased its sales revenue very significantly in all three business regions. Sales in the EMEA region surged by 71.3% in constant currencies (reported: +70.5%) to €580.1 million, particularly benefitting from additional demand from coronavirus vaccine manufacturers. This region accounted for the largest share of Group sales of about 43%. With a rise of 66.1% in constant currencies to €352.0 million (reported: +62.8%), sales in the Asia| Pacific also rose strongly, increasing the region's share of Group sales revenue slightly to 26%. The Americas region accounted for around 31% of Group sales and registered growth of 46.1% in constant currencies to €419.8 million (reported: +34.3%).

Sartorius Stedim Biotech

First-Half Financial Report Group Business Development 4

Overproportionate Increase in Underlying Earnings

Sartorius Stedim Biotech uses earnings before interest, taxes, depreciation and amortization (EBITDA) as the key profitability measure. To provide a complete and transparent presentation of the Group's profitability, SSB reports earnings adjusted for extraordinary items (underlying EBITDA).

In the first half of 2021, underlying EBITDA of the Sartorius Stedim Biotech Group rose sharply by 85.8% to €487.4 million. The corresponding margin increased year over year from 30.2% to 36.1%. The increase was driven especially by economies of scale and, additionally, by partially deferred cost development caused by the low number of business trips and underproportionate new hires in non-production areas as a result of the pandemic. These effects are expected to decrease as the year progresses.

Reconciliation between EBIT and underlying EBITDA

in millions of €

6 months 2021

6 months 20201

EBIT (operating result)

414.1

205.0

Extraordinary items

7.0

13.5

Depreciation & amortization

66.3

43.8

Underlying EBITDA

487.4

262.3

1 The previous year's figures have been restated due to finalization of the purchase price allocations for acquisitions of 2020

Consolidated EBIT doubled by 102.0% to €414.1 million, up from €205.0 million in the prior-year period. In addition to depreciation and amortization, this figure includes extraordinary items of -€7.0 million compared to -€13.5 million in the previous year, which were primarily related to the integration of the company's most recent acquisitions, as well as to expenses incurred for various corporate projects and the rebranding. The consolidated EBIT margin amounted to 30.6% (H1 2020: 23.6%).

The financial result was -€40.8 million for the first half of 2021, relative to -€10.5 million for the prior-year period, and includes an expense item of -€35.3 million that resulted from the reporting date valuation of the share-basedearn-out liability to be paid in connection with the acquisition of BIA Separations. This item was essentially incurred due to the increase in the corresponding share prices.

Net profit attributable to shareholders of Sartorius Stedim Biotech S.A. surged by 83.2% to €258.4 million (H1 2020: €141.1 million). Regarding the calculation of tax expenses, the tax rate of 27.5% expected for the full year was applied (H1 2021: 27.5%). Considering the non-tax-deductible items in the above-mentioned valuation of the earn-out liability, this would yield a nominal tax rate of approximately 30.1%.

Disclaimer

Sartorius Stedim Biotech SA published this content on 21 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 July 2021 07:58:10 UTC.


© Publicnow 2021
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Financials
Sales 2021 2 877 M 3 222 M 3 222 M
Net income 2021 595 M 666 M 666 M
Net Debt 2021 538 M 603 M 603 M
P/E ratio 2021 57,8x
Yield 2021 0,38%
Capitalization 34 014 M 38 378 M 38 093 M
EV / Sales 2021 12,0x
EV / Sales 2022 10,3x
Nbr of Employees 9 619
Free-Float -
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Income Statement Evolution
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Mean consensus OUTPERFORM
Number of Analysts 10
Last Close Price 369,00 €
Average target price 471,11 €
Spread / Average Target 27,7%
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Managers and Directors
Joachim Kreuzburg Chairman & Chief Executive Officer
Oscar-Werner Reif Executive VP-Research & Development
Henri Riey Independent Non-Executive Director
Anne-Marie Graffin Independent Non-Executive Director
Susan Dexter Independent Non-Executive Director
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