FRANKFURT (Reuters) – Franco-German lab supplies maker Sartorius predicted that full-year sales would come in at the lower half of its target range after pandemic-related demand dropped, and its shares slid to a five-month low on concerns over slowing growth next year.
Sales growth for 2022 is now expected to be in the lower half of the range of around 15% to 19% projected so far, it said in a statement on Wednesday, confirming an adjusted earnings margin target of about 34% for 2022.
“We are specifying our full-year outlook for 2022 within the range projected so far, but the global political and economic uncertainties remain high,” said Chief Executive Joachim Kreuzburg.
The company also cited a “swift normalization of demand following two years influenced by strong special effects due to the pandemic”.
Its fast-growing Bioprocess Solutions division, which supplies substances and gear to biopharmaceutical companies, saw nine-month sales jump 24% to 2.47 billion euros ($2.43 billion), but incoming orders dropped more than 10% during the period.
Its shares slumped 11.5% to a five-month low at 0735 GMT.
Last year’s high demand from vaccine manufacturers could not be repeated, and some customers were still running down inventories that were quickly filled in 2021, the company said.
Orders were below expectations, analysts at JP Morgan said, adding that was “unlikely to reduce lingering concerns over the outlook for 2023”.
Analysts on average expect 4.7 billion euros in sales next year, a year-on-year gain of about 12%, according to Refinitiv data.
Sartorius has projected roughly 10% annual sales growth through 2025, or about 14% when excluding the expected drop in business related to the coronavirus as drugmakers embrace new high-tech methods such as mRNA, cell therapies and more complex therapeutic proteins.
Underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 21.4% to 1.05 billion euros in the first nine months, broadly in line with market expectations.
($1 = 1.0171 euros)
(Reporting by Ludwig Burger, Editing by Miranda Murray and Emelia Sithole-Matarise)
