- The Company is Maintaining its Fiscal 2022
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 first quarter of 2022.
First Quarter 2022 Highlights (compared to the same period
last year)
- First quarter revenue increased 10% to €212.1 million, diluted
earnings per share were €0.10 and adjusted diluted earnings per
share were €0.11,
- Adjusted EBITDA totaled €54.0 million with an adjusted EBITDA
margin of 25.5%,
- Backlog increased 49% to approximately €992.2 million,
- Revenue from high value solutions increased to approximately
29% of total revenue, and
- The Company is maintaining its full year guidance.
First quarter results:
Revenue for the first quarter of 2022 increased 10%
(approximately 8% on a constant currency basis), compared to the
same period last year, to €212.1 million driven by growth in both
segments. The first quarter of fiscal 2021 included a €5.5 million
revenue benefit from a licensing agreement in the Biopharmaceutical
and Diagnostic Solutions (BDS) Segment that bolstered margins and
earnings in that period. Revenue related to Covid-19 was
approximately 10% in the first quarter of 2022, compared to
approximately 14% for the same period last year. Revenue
contributions from more accretive, high value solutions increased
to approximately 29% of total revenue for the first quarter of
2022, up from approximately 23% for the first quarter of last
year.
For the first quarter of 2022, gross profit margin was 31.8%,
and benefitted from a higher mix of high value solutions which was
offset by a temporary slowdown in production due to higher
absenteeism in January related to Covid-19 and, to a lesser extent,
inflationary costs which the Company expects to recover (in whole
or in part) in future periods. Operating profit margin for the
first quarter of 2022 was 17.9% (18.3% on an adjusted basis) which
reflects increased research and development activities and higher
general and administrative expenses arising from being a public
company. First quarter net profit totaled €27.8 million, or €0.10
of diluted earnings per share, while adjusted net profit was €28.6
million or €0.11 of adjusted diluted earnings per share. For the
first quarter, adjusted EBITDA totaled €54.0 million with an
adjusted EBITDA margin of 25.5%.
Franco Moro, Chief Executive Officer, stated, “We begin 2022 on
solid footing as we build a track record of consistent performance
and execute on our long-term strategic plan, giving us the
confidence to maintain our full year guidance. We operate in an
environment of strong demand, with attractive end markets that have
durable, secular multi-year drivers and we are poised to capitalize
on these favorable trends. We are investing in our future to drive
sustainable growth, increase our mix of high value solutions to
meet customer demand, and expand margins over the long-term."
Biopharmaceutical and Diagnostic Solutions Segment
(BDS)
For the first quarter, BDS Segment revenue grew 7%
(approximately 5% on a constant currency basis) over the prior year
to €172.4 million (external customer sales). The prior-year period
included a €5.5 million revenue benefit that provided an uplift to
margins in that period. Year-over-year revenue growth was driven by
a 37% increase in high value solutions which totaled €61.5 million
in the first quarter of 2022 and represented approximately 36% of
Segment revenue.
For the first quarter, gross profit margin* was 32.9% and
reflects the favorable mix shift to high value solutions which was
offset by the aforementioned production slow down due to Covid-19,
and, to a lesser extent, inflation. Operating profit margin* was
20.7% for the first quarter of 2022.
Engineering Segment
The Engineering Segment continues to benefit from the ongoing
capital deployment by customers to satisfy industry demand. As a
result, revenue for the first quarter of 2022 increased 23%
(approximately 23% on a constant currency basis) to €39.6 million
(external customer sales) driven mainly by growth in glass forming
and visual inspection machine sales. Separately, the increase in
inter-segment revenue was due to the Company's ongoing capacity
expansion efforts under its strategic plan.
For the first quarter of 2022, gross profit margin* was 21.4%
and the Company remains focused on steadily improving Segment
margins over the long term by increasing after-sales activities and
implementing optimization efforts. Operating profit margin* was
13.8% for the first quarter of 2022.
*Calculated including intersegment transactions
Liquidity and Balance Sheet
As of March 31, the Company had a positive net financial
position of €143.3 million and cash and cash equivalents totaled
€366.7 million.
For the first quarter of 2022, cash generated from operating
activities was €5.2 million, which reflects increased working
capital needs to drive sustainable growth and higher levels of
inventory to address business needs in the current environment. The
Company is investing in the expansion of its global industrial
footprint to increase capacity in high value solutions amid rising
customer demand, and in the first quarter of 2022 capital
expenditures were €53.8 million. For the three months ended March
31, 2022, free cash flow was negative €48.8 million.
Order Intake and Backlog
Favorable demand trends continue to underpin strong order intake
and backlog. For the first quarter of 2022, order intake increased
approximately 29%, over the prior year, to approximately €324.3
million. The Company ended the first quarter with a committed
backlog of approximately €992.2 million, an increase of
approximately 49% compared to €665.0 million for the first quarter
of 2021.
Subsequent Events
Subsequent to quarter close, the Stevanato Group Board of
Directors recommended the approval of a cash dividend of
approximately €13.5 million, subject to shareholder approval at the
annual general meeting on June 1, 2022.
Executive Chairman, Franco Stevanato, commented, “This proposed
dividend affirms the Board’s confidence in management, the strength
of the underlying fundamentals of the business, and the favorable
multi-year secular trends and robust demand we see in the
market.”
Full Year 2022 Guidance
The Company is maintaining its full year 2022 guidance of:
- Revenue in the range of €935 million to €945 million;
- Adjusted diluted EPS in the range of €0.49 to €0.51 (assuming
weighted average shares outstanding of 264.7 million); and
- Adjusted EBITDA in the range of €248 million to €253
million.
As it relates to revenue contributions from Covid for fiscal
year 2022, the Company now expects Covid as a percentage of revenue
will be in the low teens, compared to its initial expectation in
the mid-teens. The Company expects that this will be favorably
offset by higher revenue from the base business.
Conference Call
The Company will host a conference call to discuss the financial
results at 8:30 a.m. Eastern Time (14:30 Central European Time) on
Tuesday, May 10, 2022. Management will refer to a slide
presentation during the call, which will be made available on the
day of the call. To view the slide presentation, please visit the
“Financial Results” page, under the Financial Information tab of
the Company's Investor Relations section of its website.
To participate on the call please dial:
United States: +1 646 664 1960 United Kingdom:
+44 020 3936 2999 Canada: +1 613 699 6539 Italy: +39 06 9450 1060
All other locations: +44 20 3936 2999 Access Code: 156733
Preregistration: To pre-register for this call, please go
to the following link:
https://www.incommglobalevents.com/registration/client/10540/stevanato-earnings-call/
You will receive your access details via email.
For Participants that do not preregister: A live
broadcast of the conference call will also be available online at
the following link: www.incommuk.com/customers/online (access code
156733).
Replay: An online archive of the broadcast will be
available at the website shortly after the live call and will be
available through Tuesday, May 24, 2022. The recording will be
accessible via the following link:
https://www.incommglobalevents.com/replay/7741/stevanato-earnings-call/
(access code: 998900).
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. For more
information, please visit www.stevanatogroup.com
Forward-Looking Statements
This press release contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995 that reflect the current views of Stevanato Group S.p.A.
(“we”, “our”, “us”, “Stevanato Group” or the “Company”). These
forward-looking statements include, or may include, words such as
“expects”, “confidence”, “poised to”, “will”, “future”, “remains”,
“assuming”, “plan”, and other similar terminology. Forward-looking
statements contained in this press release include, but are not
limited to, statements about: our future financial performance,
including our revenue, operating expenses and our ability to
maintain profitability and operational and commercial capabilities;
our expectations regarding the development of our industry and the
competitive environment in which we operate; the expansion of our
plants and our expectations to increase production capacity; the
global supply chain and our committed orders; the global response
to COVID-19 and our role in it; our geographical and industrial
footprint; and our goals, strategies and investment plans. These
statements are neither promise nor guarantee but involve known and
unknown risks, uncertainties and other important factors and
circumstances that may cause Stevanato Group’s actual results,
performance or achievements to be materially different from its
expectations expressed or implied by the forward-looking
statements, including conditions in the U.S. capital markets,
negative global economic conditions, inflation, potential negative
developments in the COVID-19 pandemic, the impact of the conflict
between Russia and Ukraine, supply chain challenges and other
negative developments in Stevanato Group’s business or unfavorable
legislative or regulatory developments. The following are some of
the factors that could cause our actual results to differ
materially from those expressed in or underlying our
forward-looking statements: (i) our product offerings are highly
complex, and, if our products do not satisfy applicable quality
criteria, specifications and performance standards, we could
experience lost sales, delayed or reduced market acceptance of our
products, increased costs and damage to our reputation; (ii) we
must develop new products and enhance existing products, adapt to
significant technological and innovative changes and respond to
introductions of new products by competitors to remain competitive;
(iii) our backlog might not accurately predict our future revenue,
and we might not realize all or any part of the anticipated revenue
reflected in our backlog; (iv) if we fail to maintain and enhance
our brand and reputation, our business, results of operations and
prospects may be materially and adversely affected; (v) we are
highly dependent on our management and employees. Competition for
our employees is intense, and we may not be able to attract and
retain the highly skilled employees that we need to support our
business and our intended future growth; (vi) our business,
financial condition and results of operations depend upon
maintaining our relationships with suppliers and service providers;
(vii) our business, financial condition and results of operations
depend upon the availability and price of high-quality materials
and energy supply and our ability to contain production costs;
(viii) the current conflict between Russia and Ukraine and the
financial and economic sanctions imposed by the European Union, the
U.S., the United Kingdom and other countries and organizations
against officials, individuals, regions, and industries in Russia
and Belarus may negatively impact our ability to source gas at
commercially reasonable terms or at all and could have a material
adverse effect on our operations; (ix) significant interruptions in
our operations could harm our business, financial condition and
results of operations; (x) as a consequence of the COVID-19
pandemic, sales of syringes and vials to and for vaccination
programs globally increased resulting in a revenue growth
acceleration. The demand for such products may shrink, if the need
for COVID-19 related solutions declines; (xi) our manufacturing
facilities are subject to operating hazards which may lead to
production curtailments or shutdowns and have an adverse effect on
our business, results of operations, financial condition or cash
flows; (xii) we may face significant competition in implementing
our strategies for revenue growth in light of actions taken by our
competitors; (xiii) our global operations are subject to
international market risks that may have a material effect on our
liquidity, financial condition, results of operations and cash
flows; (xiv) we are required to comply with a wide variety of laws
and regulations and are subject to regulation by various federal,
state and foreign agencies; (xv) if relations between China and the
United States deteriorate, our business in the United States and
China could be materially and adversely affected; and (xvi) Cyber
security risks and the failure to maintain the confidentiality,
integrity and availability of our computer hardware, software and
internet applications and related tools and functions, could result
in damage to our reputation, data integrity and/or subject us to
costs, fines or lawsuits under data privacy or other laws or
contractual requirements. This list is not exhaustive. We caution
you therefore against relying on these forward-looking statements
and we qualify all of our forward-looking statements by these
cautionary statements.
These forward-looking statements speak only as at their dates.
The Company undertakes no obligation to update any forward-looking
statement or statements to reflect events or circumstances after
the date on which such statement is made or to reflect the
occurrence of unanticipated events. New factors emerge from time to
time, and it is not possible to predict all of these factors.
Further, the Company cannot assess the impact of each such factor
on our business or the extent to which any factor, or combination
of factors, may cause actual results to be materially different
from those contained in any forward-looking statements.
For a description of certain additional factors 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 Annual Report on Form 20-F/A for the year ended
December 31, 2021 filed with the U.S. Securities and Exchange
Commission on April 5, 2022.
Consolidated Income
Statement
(Amounts in € millions, except
per share data)
(Unaudited)
For the three months
ended March 31,
2022
%
2021
%
Revenue
212.1
100.0
%
192.8
100.0
%
Costs of sales
144.6
68.2
%
127.4
66.1
%
Gross Profit
67.5
31.8
%
65.4
33.9
%
Other operating Income
1.5
0.7
%
3.2
1.7
%
Selling and Marketing Expenses
4.9
2.3
%
5.9
3.1
%
Research and Development Expenses
7.7
3.6
%
5.8
3.0
%
General and Administrative Expenses
18.5
8.7
%
14.0
7.3
%
Operating Profit
37.9
17.9
%
42.9
22.3
%
Finance Income
3.0
1.4
%
2.0
1.0
%
Finance Expense
4.6
2.2
%
3.2
1.7
%
Profit Before Tax
36.3
17.1
%
41.7
21.6
%
Income Taxes
8.5
4.0
%
5.1
2.6
%
Net Profit
27.8
13.1
%
36.6
19.0
%
Earnings per share
Basic earnings per common share
0.10
0.15
Diluted earnings per common share
0.10
0.15
Average common shares outstanding
264.7
240.6
Average shares assuming dilution
264.7
240.6
Reported Segment
Information
(Amounts in €
millions)
(Unaudited)
For the three months ended
March 31, 2022
Biopharmaceutical and
Diagnostic Solutions
Engineering
Adjustments, eliminations and
unallocated items
Consolidated
External Customers
172.4
39.6
—
212.1
Inter-Segment
0.3
23.5
(23.8
)
—
Revenue
172.7
63.1
(23.8
)
212.1
Gross Profit
56.8
13.5
(2.8
)
67.5
Gross Profit Margin
32.9
%
21.4
%
31.8
%
Operating Profit
35.7
8.7
(6.5
)
37.9
Operating Profit Margin
20.7
%
13.8
%
17.9
%
For the three months ended
March 31, 2021
Biopharmaceutical and
Diagnostic Solutions
Engineering
Adjustments, eliminations and
unallocated items
Consolidated
External Customers
160.6
32.3
—
192.8
Inter-Segment
0.2
7.7
(7.9
)
—
Revenue
160.8
40.0
(7.9
)
192.8
Gross Profit
57.3
8.7
(0.6
)
65.4
Gross Profit Margin
35.6
%
21.8
%
33.9
%
Operating Profit
40.3
4.4
(1.8
)
42.9
Operating Profit Margin
25.1
%
11.0
%
22.3
%
Cash Flow
(Amounts in €
millions)
(Unaudited)
For the three months ended
March 31,
2022
2021
Cash flow from operating activities
5.2
5.9
Cash flow used in investing activities
(54.7
)
(22.4
)
Cash flow from/ (used in) financing
activities
3.1
(19.8
)
Net change in cash and cash
equivalents
(46.4
)
(36.4
)
Non-GAAP Financial Information
This press release contains non-GAAP measures. Please refer to
the tables included in this press release for a reconciliation of
non-GAAP 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 Net Profit, Adjusted Diluted EPS, Capital
Employed, Net Cash, and Free Cash Flow, 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.
Reconciliation of Revenue to
Constant Currency Revenue
(Amounts in €
millions)
(Unaudited)
Three months ended March 31,
2022
Biopharmaceutical and
Diagnostic Solutions
Engineering
Reported Revenue (IFRS GAAP)
172.4
39.6
Effect of changes in currency translation
rates
(3.1
)
(0.0
)
Organic Revenue (Non-IFRS GAAP)
169.3
39.6
Reconciliation of
EBITDA
(Amounts in €
millions)
(Unaudited)
For the three months ended
March 31,
Change
2022
2021
%
Net Profit
27.8
36.6
(24.0
)%
Income Taxes
8.5
5.1
66.7
%
Finance Income
(3.0
)
(2.0
)
50.0
%
Finance Expenses
4.6
3.2
43.8
%
Operating Profit
37.9
42.9
(11.6
)%
Depreciation and Amortization
15.2
12.9
17.8
%
EBITDA
53.1
55.9
(5.0
)%
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 March 31,
2022
EBITDA
Operating Profit
Income Taxes
Net Profit
Diluted EPS
Reported
53.1
37.9
8.5
27.8
0.10
Adjusting items:
Start-up costs new plants (1)
0.9
0.9
0.1
0.8
0.01
Adjusted
54.0
38.8
8.6
28.6
0.11
Adjusted Margin
25.5
%
18.3
%
—
—
—
Three months ended March 31,
2021
EBITDA
Operating Profit
Income Taxes
Net Profit
Diluted EPS
Reported
55.9
42.9
5.1
36.6
0.15
Adjusting items:
Restructuring and related charges (2)
0.3
0.3
0.1
0.2
0.00
Incentive Plans Settlement (3)
(2.1
)
(2.1
)
(0.5
)
(1.5
)
(0.01
)
IPO costs (4)
1.5
1.5
0.4
1.1
0.01
Patent Box (5)
—
—
5.5
(5.5
)
(0.02
)
Adjusted
55.6
42.6
10.6
30.9
0.13
Adjusted Margin
28.9
%
22.1
%
—
—
—
(1)
During the three months ended March 31, 2022, the Group recorded
€0.9 million of start-up costs for the new plants in Fishers,
Indiana, United States, in Zhangjiagang, China, and in Latina,
Italy.
(2)
During the three months ended March 31, 2021, the Group recorded
€0.3 million in restructuring and related charges for the
consolidation of Balda plants in the U.S.
(3)
During the three months ended March 31, 2021, the Group recorded
€2.1 million of general and administrative expenses, as accrual
reversal related to the early termination of incentive plans aimed
at a limited number of key managers.
(4)
During the three months ended March 31, 2021, the Group recorded
€1.5 million consultancy costs relating to our IPO project.
(5)
During the three months ended March 31, 2021, the Group reached
an agreement with the Italian Tax agency regarding the so-called
“Patent box regime”, resulting in a retroactive tax saving for the
financial years 2016-2020 amounting to €5.5 million based on our
initial estimates.
Capital Employed
(Amounts in €
millions)
(Unaudited)
As of March 31, 2022
As of December 31, 2021
- Goodwill and Other intangible assets
79.3
79.2
- Right of Use assets
22.1
22.7
- Property, plant and equipment
440.2
392.7
- Financial assets - investments FVTPL
1.0
1.1
- Other non-current financial assets
1.3
1.3
- Deferred tax assets
57.1
55.9
Non-current assets
601.1
552.9
- Inventories
166.8
148.9
- Contract assets
77.4
62.1
- Trade receivables
174.5
165.3
- Trade payables
(154.6
)
(164.8
)
- Advances from customers
(28.7
)
(23.6
)
- Contract liabilities
(15.7
)
(18.8
)
Trade working capital
219.7
169.1
- Tax receivables and Other
receivables
52.4
51.4
- Tax payables and Other liabilities
(95.0
)
(85.3
)
Net working capital
177.1
135.3
- Deferred tax liabilities
(19.3
)
(19.1
)
- Employees benefits
(12.3
)
(11.9
)
- Provisions
(3.6
)
(3.5
)
- Other non-current liabilities
(1.8
)
(1.8
)
Total non-current liabilities and
provisions
(36.9
)
(36.3
)
Capital employed
741.3
651.9
Net cash
143.3
189.8
Equity
(884.6
)
(841.7
)
Total equity and net cash
(741.3
)
(651.9
)
Free Cash Flow
(Amounts in €
millions)
(Unaudited)
For the three months ended
March 31,
2022
2021
Cash flow from operating activities
5.2
5.9
Interest paid
0.8
1.1
Interest received
(0.2
)
(0.2
)
Purchase of property, plant and
equipment
(52.7
)
(21.7
)
Purchase of intangible assets
(1.9
)
(0.7
)
Free Cash Flow
(48.8
)
(15.6
)
Net Cash
(Amounts in €
millions)
(Unaudited)
As of March 31,
As of December 31,
2022
2021
Non-current financial liabilities
(197.2
)
(202.3
)
Current financial liabilities
(54.8
)
(46.2
)
Other current financial assets
28.6
27.2
Cash and cash equivalents
366.7
411.0
Net Cash
143.3
189.8
CAPEX
(Amounts in €
millions)
(Unaudited)
(Amounts in € millions, except
as indicated otherwise)
For the three months ended
March 31,
Change
2022
2021
€
Addition to Property, plant and
equipment
51.9
18.4
33.5
Addition to Intangible Assets
1.9
0.7
1.2
CAPEX
53.8
19.1
34.7
Reconciliation of 2022
Guidance Reported and Adjusted EBITDA, Operating Profit, Net
Profit, Diluted EPS
(Amounts in € millions, except
per share data)
(Unaudited)
EBITDA
Operating Profit
Net Profit
Diluted EPS
Reported
244.8 - 249.8
172.5 - 177.5
127.5 - 131.3
0.48 - 0.50
Adjusting items:
Start-up costs New Plants
3.2
3.2
2.4
0.01
Adjusted
248.0 - 253.0
175.7 - 180.7
129.9 - 133.7
0.49 - 0.51
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220510005683/en/
Media Stevanato Group media@stevanatogroup.com
Investor Relations Lisa Miles
lisa.miles@stevanatogroup.com
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