21 July 2020 | News
Signs are becoming apparent that the market approval of some biopharmaceuticals could be delayed due to postponed clinical test series as a result of the pandemic
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Germany headquartered Sartorius, a leading international partner of life science research and the biopharmaceutical industry,raised its growth and earnings guidance for the current year based on its very dynamic business performance in the first six months of 2020, as well as on high demand expected to continue for the rest of the current fiscal year.
“In the Bioprocess Solutions Division, growth was strong across all product categories and geographies, where additional demand particularly in connection with Covid-19 vaccines and therapeutics was higher than previously expected. The business of our Lab Products & Services Division that was noticeably impacted by the pandemic crisis in the first months of the year also showed a positive trend. Moreover, integration of the life science businesses acquired from Danaher into both of our divisions is progressing well despite the current restrictions. Therefore, we are entering the second half of the year with great confidence, even though the pandemic still poses considerable challenges and uncertainties,” said CEO Joachim Kreuzburg.
Group sales rose in the first half by 17.9 percent to 1,056.8 million euros, which is a reported increase of 18.1 percent while order intake1 surged by 27.5 percent (reported: +27.8 percent) to 1,244.8 million euros. This strong development was primarily fueled by the very dynamic business of the Bioprocess Solutions Division. The Laboratory Products & Services Division progressed moderately in a partially challenging economic environment weakened by the coronavirus pandemic. The acquisition of Danaher's businesses consolidated as of May 2020 as well as the majority takeover of the cell culture media specialist Biological Industries in December 2019 together contributed close to four percentage points to sales growth in the first half, as planned.
All business regions of the Group increased their revenues by double digits. In the EMEA region which contributes the highest share of total Group sales of around 40 percent, revenue stood at 419.5 million euros, up 16.0 percent. The Americas region accounting for some 35 percent of total sales recorded the highest momentum, with business rising 19.7 to 373.1 million euros. The Asia | Pacific region, which generates around 25 percent of Group sales, saw revenue rise by 18.4 percent to 264.2 million euros.
Despite the currently increased demand, Sartorius does not see any need to adjust its medium-term forecast up to 2025 at the moment. The company continues to expect to achieve sales revenue of around 4 billion euros at an underlying EBITDA margin of about 28 percent in 2025 .
This is based on the fact that the medium-term fundamentals of the biopharmaceutical industry have remained unchanged. Therefore, it is currently not foreseeable whether the current additional demand for vaccines and antiviral drugs will lead to a sustained increase in demand in these areas.
In addition, signs are becoming apparent that the market approval of some biopharmaceuticals could be delayed due to postponed clinical test series as a result of the pandemic. It is currently not possible to quantify the impact of these various effects concerning monetary amounts or timing.