Gerresheimer makes good start into the new financial year

2019-04-12, Gerresheimer AG

Revenues up 6.3% on the prior-year quarter to EUR 308.5m
Adjusted EBITDA at EUR 145.9m in first quarter of 2019 (Q1 2018: EUR 52.6m), comprising of EUR 53.6m plus EUR 92.3m from partial derecognition of contingent purchase price components connected to the Sensile Medical acquisition
Guidance for adjusted EBITDA at constant exchange rates revised accordingly to approximately EUR 387m (plus or minus EUR 5m) for 2019; revenue guidance confirmed without change
Adjusted earnings per share increased to EUR 3.48
New plant for medical plastic systems and prefillable syringes being built in Skopje, Republic of North Macedonia
New inhalation measurement start-up project added in Advanced Technologies Division

Gerresheimer AG closed the first quarter of the financial year 2019 (December 1, 2018 to February 28, 2019) with good growth. “Our new financial year got off to a good start. Our business and all planned growth projects are on schedule. This includes the construction of a new plant for medical plastic systems and prefillable syringes in Skopje, in the Republic of North Macedonia. In our new Advanced Technologies Division, we have just added a start-up project for inhalation measurement.

I am satisfied with the start of the financial year and very optimistic looking ahead to the remainder of 2019,” said Dietmar Siemssen, CEO of Gerresheimer AG. Gerresheimer increased revenues by 6.3% to EUR 308.5m in the first quarter of the financial year 2019, compared with EUR 290.4m in the prioryear quarter. Sales of injection vials, ampoules and cartridges did well in the first quarter of 2019, as did sales of molded glass for medicines and cosmetics. Revenues with prefillable glass syringes also went up significantly. Plastic pharma packaging sold well in Europe and emerging markets, most notably in Brazil. Demand for plastic containers for prescription drugs was down in the US because there was no repeat of the prior-year quarter’s peak in demand caused by the flu season.

Gerresheimer has launched a large number of projects for profitable growth and enhanced productivity. These projects are being systematically implemented and all are running according to plan. They include a new plant in Skopje, Republic of North Macedonia, which is scheduled to be completed and go into production in 2020.

This will create production capacity for medical plastic systems and, in the medium term also for prefillable glass syringes. In addition, Gerresheimer has acquired a majority stake in a start-up project for inhalation measurement. Development of the project will continue in the new Advanced Technologies Division.

In figures, capital expenditure of EUR 16.7m was incurred in the first quarter of 2019. This was mainly directed at an expansion of our inhaler production at the Horsovsky Tyn plant in the Czech Republic together with further additions to production capacity and the product portfolio. Other capital expenditure relates to a planned furnace repair at the molded glass plant in Essen, Germany, as well as production plant modernization and automation at various plants.

Adjusted EBITDA at constant exchange rates increased from EUR 53.4m in the prior-year quarter to EUR 145.5m in the first quarter of 2019. This includes a one-off effect amounting to EUR 92.3m in other operating income due to derecognition of contingent purchase price components from the Sensile Medical acquisition. Additionally, there was no adjusted EBITDA in the first quarter of 2019 from the inhaler contract lost in 2018. Without these two one-off effects, adjusted EBITDA at constant exchange rates would have been EUR 0.9m higher than in the prior-year quarter, at EUR 53.2m in the first quarter of 2019. Reported adjusted EBITDA came to EUR 145.9m, compared with EUR 52.6m in the first quarter of 2018.

Net income stood at EUR 99.3m in the first quarter of 2019, which was EUR 50.1m higher than in the prior-year quarter. Adjusted net income after non-controlling interests amounted to EUR 109.2m, compared with a prior-year figure of EUR 58.1m. First quarter 2019 was influenced by the positive effect of derecognizing contingent purchase price components. Whilst in the prior-year quarter, tax income was substantially affected by the remeasurement of deferred taxes due to the US tax reform (EUR 43.6m). Adjusted earnings per share after non-controlling interests came to EUR 3.48 in the first quarter of 2019, compared with a prior-year figure of EUR 1.85.

Adjusted EBITDA leverage (net financial debt to adjusted EBITDA) temporarily decreased to 2.4x. The decrease relates to the significantly higher adjusted EBITDA.