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Successful fiscal 2013: Sartorius reaches sales and earnings targets – Positive outlook for 2014

By Business Wire,  January 28, 2014, 01:00:00 AM EDT

Successful fiscal 2013: Sartorius reaches sales and earnings targets - Positive outlook for 2014


  • Consolidated sales revenue climbs 7.7% to 887.3 million euros; order intake up 8.0%
  • Operating profit1) rises 7.1% to 172.6 million euros; profit margin reaches 19.5%
  • High growth dynamics in the bioprocess business
  • Company projects significant growth and further increases in earnings for 2014 as well

GOETTINGEN, Germany--(BUSINESS WIRE)-- According to preliminary figures for 2013, the Sartorius Group (FWB:SRT), a leading international laboratory and process equipment supplier, grew dynamically again in 2013 and further increased its profitability. The company fully achieved its financial targets. For the current fiscal year, Sartorius expects positive business development as well.

"Fiscal 2013 was a successful year for Sartorius, even though the divisions showed quite different development. Growth for our largest division, Bioprocess Solutions, was outstanding: it reported double-digit growth for the third year in succession. This high pace is even slightly above our own expectations and shows how well the division has meanwhile been positioned in the biopharma market. Although Lab Products & Services and Industrial Weighing faced a challenging market environment in some areas, they both performed quite well. In addition, as we phased out a few product lines from the lab division's portfolio, this had an impact on its results so operating performance was actually better than the figures show. We see that we are on track to meet our long-term Sartorius 2020 targets, and, for 2014, are confident that all three divisions will grow profitably," commented CEO Dr. Joachim Kreuzburg.

Dynamic growth of sales revenue and order intake

According to 2013 preliminary figures, Sartorius generated consolidated sales revenue of 887.3 million euros, up from 845.7 million euros a year ago. This equates to an increase in constant currencies (cc) of 7.7% (reported: 4.9%). The gain in Group order intake was also strong, climbing 8.0% (reported: 5.2%) to 912.3 million euros.

Accounting for more than half of consolidated revenue, the Bioprocess Solutions Division continued on track: It posted strong sales growth of 11.9% (reported: 9.2%) to 517.8 million euros and a surge in order intake of 17.4% (reported: 14.6%) to 549.7 million euros. This excellent expansion was driven by all product segments. Cell culture media business acquired in December 2012 contributed approximately two percentage points to the division's sales growth.

Sales revenue for the Lab Products & Services Division rose 2.4% (reported: -0.5%) to 267.4 million euros. Without the phase-out of a few non-strategic product lines, this figure would have been around two percentage points higher. The soft market environment in Asia at the start of the year had a dampening effect on the division's business, which picked up, however, as the year progressed. Order intake was at 263.6 million euros relative to 282.0 million euros a year earlier (constant currencies (cc): -3.7%; reported: -6.5%); the portfolio impact on this figure was around -3 percentage points.

After experiencing a challenging first quarter, Industrial Weighing, the smallest Group division, showed positive performance during the further course of the year. For the full year, its sales revenue rose 2.4% (reported: -0.7%) to 102.0 million euros. At 99.0 million euros, order intake for Industrial Weighing was slightly below the prior-year figure (cc: -3.1%; reported: -6.0%).

Regionally, Sartorius achieved the highest sales growth in Asia, up 10.3%. Business in this region was driven primarily by high demand for single-use products and equipment used in biopharmaceutical production. In the European market, which accounts for around half of Sartorius' business, sales revenue climbed 8.5%. All divisions reported gains in this area. Seen against the background of strong growth in the previous year, sales revenue for the North American region grew more moderately, gaining 2.6%. (All regional figures are given in constant currencies.)

Further increase in consolidated profit

Again in fiscal 2013, Sartorius further expanded its profitability. Its underlying EBITDA1) rose overproportionally by 7.1% to 172.6 million euros, despite negative currency effects, and its respective margin increased from 19.0% to 19.5%.

Mainly driven by economies of scale, earnings contributed by the Bioprocess Solutions Division surged 15.6% to 119.3 million euros, up from 103.2 million euros a year earlier. Its corresponding margin rose from 21.8% to 23.0%. The Lab Products & Services Division reported an underlying EBITDA of 42.9 million euros relative to 45.9 million euros a year ago and a margin of 16.0%, compared with 17.1% in the previous year. Underlying EBITDA for the Industrial Weighing Division was at 10.4 million euros relative to 11.9 million euros a year ago; this corresponds to a margin of 10.1% versus 11.6% in the year before.

Group EBIT, including extraordinary items of -8.4 million euros (2012: -13.9 million euros), depreciation and amortization, rose 8.9% from 106.8 million euros a year earlier to 116.3 million euros. The Group's EBIT margin reached 13.1% relative to 12.6% a year ago. Relevant net profit for the Group was 64.8 million euros, up 2.8% year over year. For 2013, its respective earnings per ordinary share amount to 3.79 euros, up from 3.69 euros in 2012, and per preference share, 3.81 euros, up from 3.71 euros in the previous year.

Net operating cash flow almost doubled from 53.2 million euros in 2012 to 103.3 million euros in 2013. The key financial indicator, the ratio of net debt to underlying EBITDA, was at 2.0 (previous year: 1.9) and, despite the completion of two acquisitions, thus continues to remain at a comfortable level.

Positive outlook for fiscal 2014

Sartorius expects significantly profitable growth for the year 2014 as well. The company thus forecasts that sales will grow approximately 8% to 10% in constant currencies. Its operating EBITDA margin is projected to further increase, and reach about 20.0% relative to 19.5% a year earlier.

Moreover, based on its strong growth prospects, Sartorius is planning to invest around 8% to 10% of sales in expansion of capacity and in growth projects.

In view of the three divisions, company management anticipates that sales for Bioprocess Solutions will grow approximately 12% to 15%. Recent acquisitions are expected to contribute approximately seven percentage points to the division's revenue growth. With respect to profitability, Bioprocess Solutions' underlying EBITDA margin is forecasted to rise to about 23.5%.

For the Lab Products & Services Division, Sartorius expects that sales will expand at approximately 1% to 4%. This forecast includes a two percentage point dilution of sales due to adjustment of its product portfolio. The lab division's underlying EBITDA margin is anticipated to rise to around 16.5%.

The Industrial Weighing Division projects sales revenue to increase by approximately 1% to 4% and its underlying EBITDA margin to reach 10.5%. (All figures currency-adjusted.)

Key performance indicators for 2013 at a glance

  Sartorius Group   Bioprocess Solutions   Lab Products & Services   Industrial Weighing
in millions of €

(unless otherwise specified)
  2013   2012   Δ in %   2013   2012   Δ in %   2013   2012   Δ in %   2013   2012   Δ in %
Order intake   912.3   866.8   5.2   549.7   479.5   14.6   263.6   282.0   - 6.5   99.0   105.4   - 6.0
Sales revenue   887.3   845.7   4.9   517.8   474.2   9.2   267.4   268.9   - 0.5   102.0   102.7   - 0.7
Operating earnings

(underlying EBITDA)1)2)
  172.6   161.1   7.1   119.3   103.2   15.6   42.9   45.9   - 6.5   10.4   11.9   - 13.3
EBITDA margin2) in %   19.5   19.0       23.0   21.8       16.0   17.1       10.1   11.6    
EBITA2)   137.2   132.5   3.6   98.5   86.5   13.9   30.9   36.0   - 14.0   7.8   10.0   - 21.7
EBITA margin2)   15.5   15.7       19.0   18.2       11.6   13.4       7.7   9.7    
Extraordinary expenses   - 8.4   - 13.9   39.3                                    
Group net profit3)   64.8   63.0   2.8                                    
Earnings per ordinary share3)

in €
  3.79   3.69   2.8                                    
Earnings per preference share3)

in €
  3.81   3.71   2.8                                    

1) Sartorius uses underlying EBITDA (earnings before interest, taxes, depreciation and amortization and adjusted for extraordinary items) as the key profitability measure.

2) Adjusted for extraordinary items (underlying)

3) Relevant net profit for the Group is calculated by adjusting for extraordinary items, eliminating non-cash amortization and fair value adjustments of hedging instruments, including the corresponding tax effects for each of these items, as well as by taking non-controlling interest into account.

The numbers mentioned above are still subject to final review by the auditors. The final figures will be announced at the annual press conference on March 3, 2014.

Current image files:

Dr. Joachim Kreuzburg, CEO and Executive Board Chairman of Sartorius AG:

http://www.sartorius.com/fileadmin/media/global/company/Sartorius_Kreuzburg.jpg

Sartorius products used in the manufacture of medications:

www.sartorius.com/fileadmin/media/global/company/pr_20120419_bioprocess_solutions.jpg

Sartorius products used in laboratory research:

www.sartorius.com/fileadmin/media/global/company/pr_20120419_lab_products_services.jpg

Conference call and webcast:

Dr. Joachim Kreuzburg, CEO and Executive Board Chairman of Sartorius, will discuss the preliminary figures for 2013 with analysts and investors on Tuesday, January 28, 2014, at 3:30 p.m. Central European Time (CET), in a teleconference. You may dial into the teleconference starting at 3:20 p.m. CET at the following numbers:

Germany: +49 (0)69 2222 10644

France: +33 (0)1 76 77 22 40

U.K.: +44 (0)20 3427 1937

USA: +1646 254 3376

The dial-in code is: 2350967; to view the webcast, log onto: www.sartorius.com

Upcoming financial dates:

March 3, 2014 Annual press conference in Goettingen, Germany

April 10, 2014 Annual Shareholders' Meeting in Goettingen, Germany

April 28, 2014 Publication of first-quarter figures (Jan. - March 2014)

This press release contains statements about the future development of the Sartorius Group. The content of these statements cannot be guaranteed as they are based on assumptions and estimates that harbor certain risks and uncertainties. This is a translation of the original German-language press release. Sartorius shall not assume any liability for the correctness of this translation. The original German press release is the legally binding version. Furthermore, Sartorius reserves the right not to be responsible for the topicality, correctness, completeness or quality of the information provided. Liability claims regarding damage caused by the use of any information provided, including any kind of information which is incomplete or incorrect, will therefore be rejected.

A Profile of Sartorius

The Sartorius Group is a leading international laboratory and process technology provider covering the segments of Bioprocess Solutions, Lab Products & Services and Industrial Weighing. In 2013, the technology group earned sales revenue of 887.3million euros according to preliminary figures. Founded in 1870, the Goettingen-based company currently employs around 5,800 persons. The major areas of activity of its Bioprocess Solutions segment cover filtration, fluid management, fermentation, cell cultivation and purification, and focus on production processes in the biopharmaceutical industry. The Lab Products & Services segment primarily manufactures laboratory instruments and lab consumables. Industrial Weighing concentrates on weighing, monitoring and control applications in the manufacturing processes of the food, chemical and pharma sectors. Sartorius has its own production facilities in Europe, Asia and America as well as sales subsidiaries and local commercial agencies in more than 110 countries.

Source: Sartorius



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