- Reiterates Full Year 2023 Revenue and
Adjusted Diluted Earnings per Share Guidance; Increases Adjusted
EBITDA Guidance -
Stevanato Group S.p.A. (NYSE: STVN), a leading global provider
of drug containment, drug delivery, and diagnostic solutions to the
pharmaceutical, biotechnology, and life sciences industries, today
announced its financial results for the second quarter of 2023.
Second Quarter 2023 Highlights (compared with the same period
last year)
- Second quarter revenue increased 9% to €255.3 million.
- Revenue from high-value solutions increased to 33% of total
revenue.
- Diluted earnings per share were €0.13; adjusted diluted
earnings per share were €0.14.
- Adjusted EBITDA margin increased 30 basis points to 26.7%.
- The Company is reiterating its full year 2023 guidance of
revenue in the range of €1.085 billion to €1.115 billion, and
adjusted diluted EPS between €0.58 and €0.62; and raising its
adjusted EBITDA guidance to range between €291.8 million to €303.8
million.
Second Quarter 2023 Results
Revenue for the second quarter of 2023 increased 9% to €255.3
million (approximately 10% on a constant currency basis), compared
with the same period last year, driven by growth in both of the
Company's business segments. For the second quarter of 2023,
revenue from high-value solutions increased to 33% of total
revenue, compared with 30% in the same period last year, resulting
from increased customer demand for high-performance, ready-to-use
containment solutions. For the second quarter of 2023, revenue
related to Covid-19 decreased 89% and represented approximately 1%
of revenue compared with approximately 9% of revenue for the same
period last year.
For the second quarter of 2023, gross profit margin decreased 90
basis points to 30.9%, resulting from expected temporary
inefficiencies related to start-up activities of the Company's new
manufacturing plants. This included a rise in industrial costs and
higher depreciation, which was partially offset by the increased
mix of more accretive high-value solutions. Excluding industrial
costs related to start-up activities, gross profit margin would
have been 32.3% for the second quarter of 2023, compared with 32.1%
for the same period last year. Operating profit margin for the
second quarter of 2023 decreased 110 basis points to 17.6%.
Excluding start-up expenses, adjusted operating profit margin was
19.1% for the second quarter of 2023. This compares with adjusted
operating profit margin of 19.6% for the same period last year,
which included a €6.0 million benefit from a contract
modification.
For the second quarter of 2023, adjusted EBITDA margin increased
30 basis points to 26.7%.
The Company delivered net profit of €34.3 million, or €0.13 of
diluted earnings per share, and on an adjusted basis, net profit
was €37.0 million, or €0.14 of diluted earnings per share.
Franco Moro, Chief Executive Officer, stated, “We currently see
strong secular tailwinds, notably in biologics, which are creating
downstream demand for high-value solutions. In response to customer
demand for high-performance, integrated solutions, we are investing
in growth platforms to expand our capacity for high-value
solutions. The continued advancements in biologics, including mRNA
applications, monoclonal antibodies, GLP-1s, and biosimilars are
expected to help drive durable, long-term organic revenue growth in
the range of high single-digits to low double-digits."
Biopharmaceutical and Diagnostic Solutions Segment
(BDS)
For the second quarter of 2023, Biopharmaceutical and Diagnostic
Solutions (BDS) Segment revenue grew 9% to €204.8 million
(approximately 9% on a constant currency basis), compared with the
same period last year, driven by growth in the Company's core drug
containment business. For the second quarter of 2023, revenue from
high-value solutions increased 20% to €84.2 million, while revenue
from other containment and delivery solutions increased 2% to
€120.6 million.
Margins in the segment were tempered, as expected, by the
start-up of the Company's new EZ-fill® manufacturing plants, which
was partially offset by the increased mix of more accretive
high-value solutions. This led to gross profit margin of 31.6% and
operating profit margin of 19.8% for the second quarter of
2023.
Engineering Segment
Revenue from the Engineering Segment increased 11% to €50.5
million for the second quarter of 2023, compared with the same
period last year, due to an increase in sales of pharmaceutical
visual inspection lines.
For the second quarter of 2023, gross profit margin for the
Engineering Segment increased 20 basis points to 22.5%, driven by
higher sales in more accretive products and continued business
optimization efforts. Operating profit margin was 15.5%, consistent
with the same period last year.
Balance Sheet and Cash Flow
As of June 30, 2023, the Company had net debt of €120.4 million,
cash and cash equivalents of €61.2 million, and €130 million
available under two loan agreements which were completed in 2023.
As expected, capital expenditures for the second quarter increased
to €138 million, as the Company continues to execute its strategic
investments in capacity expansion for high-value solutions to meet
customer demand.
For the second quarter of 2023, cash generated from operating
activities was €24.4 million, which reflects current working
capital needs to support growth. Cash flow used for the purchase of
property, plant, and equipment, and intangible assets totaled €93.7
million, which resulted in negative free cash flow of €69.1 million
in the second quarter of 2023.
New Order Intake and Backlog
For the second quarter of 2023, new order intake totaled
approximately €240 million, compared with €252 million in the same
period last year, which reflects the expected decrease in orders
related to Covid-19 and the normalization of customer ordering
patterns as global supply chains continue to stabilize. As of June
30, 2023, committed backlog totaled approximately €939 million.
2023 Guidance
The Company is reiterating its full year 2023 revenue and
adjusted diluted earnings per share guidance and still expects:
- Revenue in the range of €1.085 billion to €1.115 billion,
- Adjusted diluted EPS in the range of €0.58 to €0.62.
The Company is increasing its adjusted EBITDA guidance and now
expects adjusted EBITDA in the range of €291.8 million to €303.8
million, up from its prior estimate of €290.5 million to €302.5
million.
The Company continues to expect capital expenditures in the
range of 35% to 40% of total revenue for fiscal 2023, based on the
mid-point of its revenue guidance range.
Executive Chairman, Franco Stevanato, concluded, "We are pleased
with another quarter of solid operational and financial performance
as we continue to build on our track record and execute against our
long-term growth objectives. We are successfully responding to
market demand which is driving our mix shift to high-value
solutions. Our growth investments are on track as we expand
capacity in high-value solutions to meet strong customer demand.
With our diverse product portfolio, we believe we are well
positioned to capitalize on favorable secular trends such as the
projected growth in biologics."
Conference Call
The Company will host a conference call and webcast at 8:30 a.m.
(ET) on Friday, July 28, 2023 to discuss financial results. During
the call, management will refer to a slide presentation which will
be available on the day of the call on the “Financial Results” page
under the Company's Investor Relations section of its website.
Pre-registration: Participants who pre-register will be
given a conference passcode and unique PIN to gain immediate access
to the call and bypass the live operator. We encourage participants
to pre-register for the call using the following link:
http://services.choruscall.it/DiamondPassRegistration/register?confirmationNumber=4544003&linkSecurityString=514976446
Webcast: A live, listen-only webcast of the call will be
available at the following link:
https://87399.choruscall.eu/links/stevanato230728.html
Dial in: Those who are unable to pre-register may dial in
by calling:
Italy: + 39 02 802 09 11 UK: + 44 1 212
818004 USA: +1 718 705 8796 USA Toll Free: +1 855 265 6958
Replay: The webcast will be archived for three months on
the Company’s Investor Relations section of its website at:
https://ir.stevanatogroup.com/financial-results.
Forward-Looking Statements
This press release may include forward-looking statements. The
words "expects," "see," "reiterating,” “strong,” “are creating,”
“are investing,” “expected,” “raising,” “are responding,"
“increasing,” "driving," "continues," "continued," "believe," “well
positioned,” “favorable,” "growth," "durable," and similar
expressions (or their negative) identify certain of these
forward-looking statements. These forward-looking statements are
statements regarding the Company's intentions, beliefs or current
expectations concerning, among other things, investments the
Company expects to make or receive, the expansion of manufacturing
capacity, the Company’s plans regarding its presence in the U.S.
and in other locations, business strategies, the Company’s capacity
to meet future market demands and support preparedness for future
public health emergencies, and results of operations. The
forward-looking statements in this press release are based on
numerous assumptions regarding the Company’s present and future
business strategies and the environment in which the Company will
operate in the future. Forward-looking statements involve inherent
known and unknown risks, uncertainties and contingencies because
they relate to events and depend on circumstances that may or may
not occur in the future and may cause the actual results,
performance or achievements of the Company to be materially
different from those expressed or implied by such forward looking
statements. Many of these risks and uncertainties relate to factors
that are beyond the Company's ability to control or estimate
precisely, such as future market conditions, currency fluctuations,
the behavior of other market participants, the actions of
regulators and other factors such as the Company's ability to
continue to obtain financing to meet its liquidity needs, changes
in the political, social and regulatory framework in which the
Company operates or in economic or technological trends or
conditions. For a description of the risks that could cause the
Company’s future results to differ from those expressed in any such
forward looking statements, refer to the risk factors discussed in
our most recent annual report on Form 20-F filed with the U.S.
Securities and Exchange Commission. Readers should therefore not
place undue reliance on these statements, particularly not in
connection with any contract or investment decision. Except as
required by law, the company assumes no obligation to update any
such forward-looking statements.
Non-GAAP Financial Information
This press release contains non-GAAP financial measures. Please
refer to the tables included in this press release for a
reconciliation of non-GAAP financial measures.
Management monitors and evaluates our operating and financial
performance using several non-GAAP financial measures, including
Constant Currency Revenue, EBITDA, Adjusted EBITDA, Adjusted EBITDA
Margin, Adjusted Operating Profit, Adjusted Operating Profit
Margin, Adjusted Income Taxes, Adjusted Net Profit, Adjusted
Diluted EPS, Capital Employed, Net Cash, Free Cash Flow, and CAPEX.
We believe that these non-GAAP financial measures provide useful
and relevant information regarding our performance and improve our
ability to assess our financial condition. While similar measures
are widely used in the industry in which we operate, the financial
measures we use may not be comparable to other similarly titled
measures used by other companies, nor are they intended to be
substitutes for measures of financial performance or financial
position as prepared in accordance with IFRS.
About Stevanato Group
Founded in 1949, Stevanato Group is a leading global provider of
drug containment, drug delivery and diagnostic solutions to the
pharmaceutical, biotechnology and life sciences industries. The
Group delivers an integrated, end-to-end portfolio of products,
processes, and services that address customer needs across the
entire drug life cycle at each of the development, clinical and
commercial stages. Stevanato Group’s core capabilities in
scientific research and development, its commitment to technical
innovation, and its engineering excellence are central to its
ability to offer value added solutions to clients. To learn more,
visit: www.stevanatogroup.com.
Consolidated Income
Statement
(Amounts in € millions, except
per share data)
(Unaudited)
For the three months
For the six months
ended June 30,
ended June 30,
2023
%
2022
%
2023
%
2022
%
Revenue
255.3
100.0
%
234.2
100.0
%
493.3
100.0
%
446.3
100.0
%
Costs of sales
176.4
69.1
%
159.7
68.2
%
338.1
68.5
%
304.3
68.2
%
Gross Profit
78.9
30.9
%
74.6
31.8
%
155.2
31.5
%
142.0
31.8
%
Other operating Income
4.0
1.6
%
7.1
3.1
%
5.2
1.1
%
8.7
1.9
%
Selling and Marketing Expenses
6.8
2.7
%
7.0
3.0
%
12.8
2.6
%
11.9
2.7
%
Research and Development Expenses
8.4
3.3
%
8.5
3.6
%
16.9
3.4
%
16.2
3.6
%
General and Administrative Expenses
22.9
9.0
%
22.3
9.5
%
45.1
9.1
%
40.8
9.1
%
Operating Profit
44.9
17.6
%
43.9
18.7
%
85.5
17.3
%
81.8
18.3
%
Finance Income
6.7
2.6
%
7.5
3.2
%
11.1
2.3
%
10.5
2.4
%
Finance Expense
7.3
2.9
%
9.9
4.2
%
16.3
3.3
%
14.5
3.2
%
Profit Before Tax
44.3
17.4
%
41.5
17.7
%
80.4
16.3
%
77.8
17.4
%
Income Taxes
10.0
3.9
%
10.9
4.7
%
17.8
3.6
%
19.4
4.3
%
Net Profit
34.3
13.4
%
30.6
13.1
%
62.6
12.7
%
58.4
13.1
%
Earnings per share
Basic earnings per common share
0.13
0.12
0.24
0.22
Diluted earnings per common share
0.13
0.12
0.24
0.22
Average common shares outstanding
264.7
264.7
264.7
264.7
Average shares assuming dilution
265.4
264.7
265.4
264.7
Reported Segment
Information
(Amounts in €
millions)
(Unaudited)
For the three months ended
June 30, 2023
Biopharmaceutical and
Diagnostic Solutions
Engineering
Adjustments, eliminations and
unallocated items
Consolidated
External Customers
204.8
50.5
—
255.3
Inter-Segment
0.4
43.0
(43.4
)
—
Revenue
205.2
93.5
(43.4
)
255.3
Gross Profit
64.9
21.0
(7.0
)
78.9
Gross Profit Margin
31.6
%
22.5
%
30.9
%
Operating Profit
40.6
14.5
(10.2
)
44.9
Operating Profit Margin
19.8
%
15.5
%
17.6
%
For the three months ended
June 30, 2022
Biopharmaceutical and
Diagnostic Solutions
Engineering
Adjustments, eliminations and
unallocated items
Consolidated
External Customers
188.6
45.6
—
234.2
Inter-Segment
0.3
27.7
(28.0
)
—
Revenue
188.9
73.3
(28.0
)
234.2
Gross Profit
63.6
16.3
(5.4
)
74.6
Gross Profit Margin
33.7
%
22.3
%
31.8
%
Operating Profit
44.6
11.4
(12.1
)
43.9
Operating Profit Margin
23.6
%
15.5
%
18.7
%
For the six months ended June
30, 2023
Biopharmaceutical and
Diagnostic Solutions
Engineering
Adjustments, eliminations and
unallocated items
Consolidated
External Customers
400.4
92.9
—
493.3
Inter-Segment
0.8
92.3
(93.2
)
—
Revenue
401.2
185.3
(93.2
)
493.3
Gross Profit
130.9
40.9
(16.6
)
155.2
Gross Profit Margin
32.6
%
22.1
%
31.5
%
Operating Profit
79.3
28.5
(22.3
)
85.5
Operating Profit Margin
19.8
%
15.4
%
17.3
%
For the six months ended June
30, 2022
Biopharmaceutical and
Diagnostic Solutions
Engineering
Adjustments, eliminations and
unallocated items
Consolidated
External Customers
361.0
85.3
—
446.3
Inter-Segment
0.6
51.2
(51.8
)
—
Revenue
361.6
136.5
(51.8
)
446.3
Gross Profit
120.4
29.8
(8.2
)
142.0
Gross Profit Margin
33.3
%
21.8
%
31.8
%
Operating Profit
80.3
20.1
(18.6
)
81.8
Operating Profit Margin
22.2
%
14.7
%
18.3
%
Cash Flow
(Amounts in €
millions)
(Unaudited)
For the three months ended
June 30,
For the six months ended June
30,
2023
2022
2023
2022
Cash flow from operating activities
24.4
42.2
61.5
47.4
Cash flow used in investing activities
(95.9
)
(76.2
)
(224.7
)
(130.9
)
Cash flow used in financing activities
(25.4
)
(19.1
)
(3.4
)
(16.0
)
Net change in cash and cash
equivalents
(96.9
)
(53.1
)
(166.5
)
(99.5
)
Non-U.S. GAAP Financial Information
This press release contains non-U.S. GAAP financial measures.
Please refer to "Non-U.S. GAAP Financial Information" and the
tables included in this press release for a reconciliation of
non-U.S. GAAP financial measures.
Reconciliation of Revenue to
Constant Currency Revenue
(Amounts in €
millions)
(Unaudited)
Three months ended June 30,
2023
Biopharmaceutical and
Diagnostic Solutions
Engineering
Reported Revenue (IFRS GAAP)
204.8
50.5
Effect of changes in currency translation
rates
1.5
0.1
Organic Revenue (Non-IFRS GAAP)
206.3
50.5
Six months ended June 30, 2023
Biopharmaceutical and
Diagnostic Solutions
Engineering
Reported Revenue (IFRS GAAP)
400.4
92.9
Effect of changes in currency translation
rates
(0.7
)
0.1
Organic Revenue (Non-IFRS GAAP)
399.7
93.0
Reconciliation of
EBITDA
(Amounts in €
millions)
(Unaudited)
For the three months ended
June 30,
Change
For the six months ended June
30,
Change
2023
2022
%
2023
2022
%
Net Profit
34.3
30.6
12.1
%
62.6
58.4
7.2
%
Income Taxes
10.0
10.9
(8.3
)%
17.8
19.4
(8.2
)%
Finance Income
(6.7
)
(7.5
)
(11.3
)%
(11.1
)
(10.5
)
5.7
%
Finance Expenses
7.3
9.9
(26.3
)%
16.3
14.5
12.4
%
Operating Profit
44.9
43.9
2.6
%
85.5
81.8
4.5
%
Depreciation and Amortization
19.5
15.9
22.6
%
37.9
31.1
21.9
%
EBITDA
64.4
59.8
7.7
%
123.4
112.9
9.3
%
Reconciliation of Reported and
Adjusted EBITDA, Operating Profit, Income Taxes,
Net Profit, and Diluted
EPS
(Amounts in € millions, except
per share data)
(Unaudited)
Three months ended June 30,
2023
EBITDA
Operating Profit
Income Taxes
Net Profit
Diluted EPS
Reported
64.4
44.9
10.0
34.3
0.13
Adjusting items:
Start-up costs new plants (1)
3.7
3.7
1.0
2.8
0.01
Restructuring and related charges (2)
0.1
0.1
0.0
0.1
0.00
Adjusted
68.2
48.7
11.0
37.0
0.14
Adjusted Margin
26.7
%
19.1
%
—
—
—
Three months ended June 30,
2022
EBITDA
Operating Profit
Income Taxes
Net Profit
Diluted EPS
Reported
59.8
43.9
10.9
30.6
0.12
Adjusting items:
Start-up costs new plants (1)
2.0
2.0
0.7
1.3
0.00
Adjusted
61.8
45.9
11.6
31.9
0.12
Adjusted Margin
26.4
%
19.6
%
—
—
—
Six months ended June 30, 2023
EBITDA
Operating Profit
Income Taxes
Net Profit
Diluted EPS
Reported
123.4
85.5
17.8
62.6
0.24
Adjusting items:
Start-up costs new plants (1)
6.6
6.6
1.8
4.8
0.01
Restructuring and related charges (2)
0.1
0.1
0.0
0.1
0.00
Adjusted
130.1
92.2
19.6
67.4
0.25
Adjusted Margin
26.4
%
18.7
%
—
—
—
Six months ended June 30, 2022
EBITDA
Operating Profit
Income Taxes
Net Profit
Diluted EPS
Reported
112.9
81.8
19.4
58.4
0.22
Adjusting items:
Start-up costs new plants (1)
2.9
2.9
0.8
2.1
0.01
Adjusted
115.8
84.7
20.2
60.5
0.23
Adjusted Margin
26.0
%
19.0
%
—
—
—
- During the three and the six months ended June 30, 2023, the
Group recorded €3.7 million and €6.6 million, respectively, of
start-up costs for the new plants in Fishers, Indiana, United
States, and in Latina, Italy. During the three months and six
months ended June 30, 2022, the Group recorded €2.0 million and
€2.9 million, respectively, of start-up costs for the new plants in
Fishers, Indiana, United States, in Zhangjiagang, China, and in
Latina, Italy.
- During the three and the six months ended June 30, 2023, the
Group recorded €0.1 million of restructuring and related charges
among general and administrative expenses.
Capital Employed
(Amounts in €
millions)
(Unaudited)
As of June 30, 2023
As of December 31, 2022
- Goodwill and Other intangible assets
77.1
79.4
- Right of Use assets
17.0
19.3
- Property, plant and equipment
861.7
641.4
- Financial assets - investments FVTPL
0.7
0.8
- Other non-current financial assets
3.2
1.0
- Deferred tax assets
77.0
69.2
Non-current assets
1,036.7
811.1
- Inventories
269.3
213.3
- Contract Assets
133.9
103.4
- Trade receivables
229.4
212.7
- Trade payables
(267.2
)
(239.2
)
- Advances from customers
(54.1
)
(26.6
)
- Contract Liabilities
(11.2
)
(14.8
)
Trade working capital
300.2
248.8
- Tax receivables and Other
receivables
70.5
54.0
- Tax payables and Other liabilities
(165.3
)
(111.1
)
Net working capital
205.4
191.7
- Deferred tax liabilities
(21.2
)
(21.0
)
- Employees benefits
(6.8
)
(8.3
)
- Provisions
(6.1
)
(5.5
)
- Other non-current liabilities
(34.0
)
(18.1
)
Total non-current liabilities and
provisions
(68.0
)
(52.9
)
Capital employed
1,174.2
949.9
Net cash/ (debt)
(120.4
)
46.0
Equity
(1,053.8
)
(995.9
)
Total equity and net debt
(1,174.2
)
(949.9
)
Free Cash Flow
(Amounts in €
millions)
(Unaudited)
For the three months ended
June 30,
For the six months ended June
30,
2023
2022
2023
2022
Cash Flow from Operating Activities
24.4
42.2
61.5
47.4
Interest paid
0.5
1.0
1.4
1.8
Interest received
(0.3
)
(0.2
)
(0.5
)
(0.4
)
Purchase of property, plant and
equipment
(92.2
)
(74.0
)
(219.9
)
(126.7
)
Proceeds from sale of property, plant and
equipment
—
0.5
—
0.5
Purchase of intangible assets
(1.5
)
(3.2
)
(2.6
)
(5.1
)
Free Cash Flow
(69.1
)
(33.7
)
(160.1
)
(82.5
)
Net Cash / (Net Debt)
(Amounts in €
millions)
(Unaudited)
As of June 30,
As of December 31,
2023
2022
Non-current financial liabilities
(120.9
)
(148.4
)
Current financial liabilities
(68.3
)
(70.7
)
Other non-current financial assets -
Derivatives
2.4
2.8
Other current financial assets
5.1
33.6
Cash and cash equivalents
61.2
228.7
Net Cash/ (Debt)
(120.4
)
46.0
CAPEX
(Amounts in €
millions)
(Unaudited)
For the three months ended
June 30,
Change
For the six months ended June
30,
Change
2023
2022
€
2023
2022
€
Addition to Property, plants and
equipment
136.7
74.3
62.4
248.8
126.2
122.6
Addition to Intangible Assets
1.5
3.2
(1.7
)
2.6
5.1
(2.5
)
CAPEX
138.2
77.5
60.7
251.4
131.3
120.1
Reconciliation of 2023
Guidance (Updated)
Reported and Adjusted EBITDA,
Operating Profit, Net Profit, Diluted EPS
(Amounts in € millions, except
per share data)
(Unaudited)
Revenue
EBITDA
Operating Profit
Net Profit
Diluted EPS *
Reported
1,085.0 - 1,115.0
281.3 - 293.3
201.3 - 213.3
145.8 - 155.7
0.55 - 0.59
Adjusting items:
Start-up costs new plants
10.5
10.5
8.0
0.03
Adjusted
1,085.0 - 1,115.0
291.8 - 303.8
211.8 - 223.8
153.8 - 163.7
0.58 - 0.62
*May not add due to rounding
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230728480286/en/
Media Stevanato Group media@stevanatogroup.com
Investor Relations Lisa Miles
lisa.miles@stevanatogroup.com
Stevanato (NYSE:STVN)
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Stevanato (NYSE:STVN)
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