DGAP-News: STADA shows good business development in the third quarter of 2017 and the first nine months

Nachricht vom 09.11.2017 (www.4investors.de) -


DGAP-News: STADA Arzneimittel AG / Key word(s): Miscellaneous

STADA shows good business development in the third quarter of 2017 and the first nine months
09.11.2017 / 07:30


The issuer is solely responsible for the content of this announcement.
- Significant growth in Group sales driven by both segments
- Double-digit increase in adjusted EBITDA - margin improvement in both segments
- Increase in cash flow
- STADA well on track to achieve targets for 2017
STADA Group Key Figures

 
Q3/2017
Q3/2016
+/-
1-9/2017
1-9/2016
+/-
Group sales, reported
EUR 554.8 million
EUR 507.0 million
+9%
EUR 1,698.0 million
EUR 1,541.7 million
+10%
Group sales, adjusted
EUR 544.7 million
EUR 505.1 million
+8%
EUR 1,641.1 million
EUR 1,537.4 million
+7%
EBITDA, reported
EUR 99.4 million
EUR 88.4 million
+12%
EUR 320.3 million
EUR 289.1 million
+11%
EBITDA, adjusted
EUR 109.8 million
EUR 98.3 million
+12%
EUR 347.5 million
EUR 300.6 million
+16%
Net income, reported
EUR 18.9 million
EUR 18.3 million
+4%
EUR 109.2 million
EUR 100.3 million
+9%
Net income, adjusted
EUR 31.2 million
EUR 43.8 million
-29%
EUR 145.4 million
EUR 139.9 million
+4%
Earnings per share, reported
EUR 0.30
EUR 0.29
+3%
EUR 1.75
EUR 1.61
+9%
Earnings per share, adjusted
EUR 0.50
EUR 0.70
-29%
EUR 2.33
EUR 2.25
+4%

 

"We achieved substantial sales and EBITDA growth in the third quarter, following our already strong development in the first half. Both our generics and our branded business contributed to this good performance. Also, the Company's transformation process is well on track and we are confident that with all the initiatives underway, STADA will become an even stronger global player in the years to come", says STADA Chairman of the Executive Board Dr. Claudio Albrecht.

Group sales again significantly increased in the third quarter
In the third quarter of 2017, reported Group sales rose by 9 percent to Euro 554.8 million. Group sales adjusted for currency and portfolio effects grew by 8 percent to Euro 544.7 million. In the first nine months of 2017, reported Group sales increased by 10 percent to Euro 1,698.0 million. Group sales adjusted for currency and portfolio effects recorded growth of 7 percent to Euro 1,641.1 million.

Reported key earnings figures influenced by special items as expected
Primarily in the second and third quarters, as expected, special items, in particular as a result of consultancy services in connection with the now completed takeover, were incurred and amounted to Euro 27.8 million before or Euro 20.0 million after taxes, thus influencing development of reported key earnings figures in the reporting period.

Reported and adjusted EBITDA shows double-digit growth in the third quarter
In the third quarter of 2017, reported EBITDA rose by 12 percent to Euro 99.4 million. Adjusted EBITDA also recorded an increase of 12 percent to Euro 109.8 million. In the first nine months of 2017, reported EBITDA increased by 11 percent to Euro 320.3 million. Adjusted EBITDA grew by 16 percent to Euro 347.5 million.

Decline in adjusted net income in the third quarter due to higher tax rate
In the third quarter of 2017, reported net income rose by 4 percent to Euro 18.9 million. Adjusted net income declined by 29 percent to Euro 31.2 million. In the first nine months of 2017, reported net income increased by 9 percent to Euro 109.2 million. Adjusted net income recorded growth of 4 percent to Euro 145.4 million. The increase in adjusted net income in the first nine months was primarily attributable to a further improved financial result. However, a significantly higher tax rate, particularly attributable to tax deferrals made in the third quarter of 2017 for future tax liabilities, had an opposing effect in the third quarter of 2017.

Cash flow increasedCash flow from operating activities improved to Euro 211.4 million in the first nine months of 2017 (1-9/2016: Euro 198.0 million). Free cash flow increased to Euro 111.6 million (1-9/2016: Euro 78.6 million). Free cash flow adjusted for payments for significant investments or acquisitions and proceeds from significant disposals increased to Euro 144.7 million (1-9/2016: Euro 132.8 million).

Net debt to adjusted EBITDA ratio improved
As of September 30, 2017, net debt was at Euro 1,066.3 million (December 31, 2016: Euro 1,118.2 million). The net debt to adjusted EBITDA ratio in the first nine months of 2017 improved to 2.3 on linear extrapolation of the adjusted EBITDA of the first nine months of 2017 on a full-year basis (1-9/2016: 3.0).

Outlook
STADA, from today's vantage point, expects the key earnings figures in the fourth quarter of 2017 to be lower than the corresponding figures in the third quarter of 2017. This is for a number of reasons, primarily including the weakening value of the Russian ruble and British pound sterling compared with the euro, the seasonal marketing expenses that are required to sustain the sales of the branded products for cough-and-cold and to continue the internationalization of certain branded products, and the potentially negative effect on sales in Spain from the political turbulence following the recently held referendum on Catalonian independence.

The Executive Board continues to expect that financial year 2017 as a whole will show growth over the previous year. Group sales adjusted for currency and portfolio effects are expected to be in the range of Euro 2.280 billion to Euro 2.350 billion, adjusted EBITDA between Euro 430 million and Euro 450 million and adjusted net income between Euro 195 million and Euro 205 million, consistent with the previously given guidance.STADA Segment Key Figures Generics

 
Q3/2017
Q3/2016
+/-
1-9/2017
1-9/2016
+/-
Sales, reported
EUR 319.8 million
EUR 304.6 million
+5%
EUR 994.2 million
EUR 931.8 million
+7%
Sales, adjusted
EUR 312.5 million
EUR 302.6 million
+3%
EUR 960.8 million
EUR 927.5 million
+4%
EBITDA, adjusted
EUR 69.4 million
EUR 64.0 million
+8%
EUR 220.1 million
EUR 193.6 million
+14%
EBITDA margin, adjusted
21.7%
21.0%
 
22.1%
20.8%
 

 

Sales development GenericsReported sales in the Generics segment recorded an increase of 5 percent to Euro 319.8 million in the third quarter of 2017. Sales adjusted for portfolio and currency effects increased by 3 percent to Euro 312.5 million. In the first 9 months of 2017, reported sales of the Generics segment increased by 7 percent to Euro 994.2 million. Sales adjusted for portfolio and currency effects showed growth of 4 percent to Euro 960.8 million. This development particularly resulted from the initial consolidation of the Serbian wholesaler Velexfarm. In addition, increased segment sales in the Belgian and Italian markets also contributed. In total, the share of the Generics segment in Group sales was at 58.6 percent in the first nine months of 2017 (1-9/2016: 60.4 percent).

Country development Generics
Within the Generics segment, development of the eight largest countries according to sales in the third quarter of 2017 and in the first 9 months of 2017 was as follows:

 
Q3/2017
Q3/2016
+/-
1-9/2017
1-9/2016
+/-
Germany
EUR 72.9 million
EUR 72.7 million
0%
EUR 218.8 million
EUR 223.2 million
-2%
Italy
EUR 40.8 million
EUR 37.0 million
+10%
EUR 125.6 million
EUR 116.8 million
+7%
Belgium
EUR 32.7 million
EUR 16.9 million
+93%
EUR 88.7 million
EUR 57.7 million
+54%
Russia
EUR 29.1 million
EUR 26.2 million
+11%
EUR 81.4 million
EUR 75.5 million
+8%
Spain
EUR 26.9 million
EUR 26.3 million
+2%
EUR 79.9 million
EUR 79.1 million
+1%
Serbia
EUR 19.2 million
EUR 11.6 million
+65%
EUR 63.2 million
EUR 37.2 million
+70%
France
EUR 17.6 million
EUR 20.1 million
-12%
EUR 56.3 million
EUR 60.5 million
-7%
Vietnam
(Pymepharco)
EUR 8.6 million
EUR 10.2 million
-15%
EUR 30.7 million
EUR 28.8 million
+6%

 

Country development Generics in the first nine months of 2017Germany: While sales at ALIUD PHARMA recorded growth due to discount agreement tenders won, sales at STADAPHARM were - against a high comparative base resulting from the expiration of discount agreements in December 2016 - below the corresponding level of the previous year. Business outside of discount agreement tenders at STADAPHARM, which has also included sales by the former cell pharm since July 1, 2017, showed positive development. This includes, among other things, sales with oncology products. Italy: Despite strong competition, positive volume growth, new launches, and price effects particularly contributed to sales growth. Belgium: The significant increase in sales mainly resulted from positive volume effects due to the independent execution of sales activities since January 2017 (following the termination of the previous distribution agreement) as well as a reduced discount rate. Russia: Sales development was primarily influenced by lower volume effects and portfolio adjustments. Spain: The slight sales growth resulted for the most part from new product launches. Serbia: The strong sales growth was mainly due to the initial consolidation of the Serbian wholesaler Velexfarm. Furthermore, it is also attributable to the change to the distribution model in the Serbian generics market, in the course of which the Serbian STADA subsidiary will now be increasingly focused on direct sales. France: The sales decline was particularly attributable to continued strong price and discount competition. Vietnam: STADA has two subsidiaries in Vietnam: Pymepharco Joint Stock Company and STADA Vietnam J.V. Co. Ltd. Since financial reports for STADA Vietnam J.V. Co. Ltd. are not available since April 2017, sales for Vietnam in the third quarter of 2017 and the first nine months of 2017 only include sales of Pymepharco. In the first nine months, Pymepharco Joint Stock Company has registered a sales increase based on positive volume effects.

EBITDA and margin development Generics
The adjusted EBITDA of the Generics segment increased by 8 percent to Euro 69.4 million in the third quarter of 2017 and by 14 percent to Euro 220.1 million in the first nine months of 2017. This development was particularly a result of improved operating profit in Belgium (following the termination of the previous distribution agreement in December 2016) as well as improved operating profit in the German and Italian Generics segment. The adjusted EBITDA margin was 21.7 percent in the third quarter of 2017 (Q3/2016: 21.0 percent) and 22.1 percent in the first nine months of 2017 (1-9/2016: 20.8 percent).

STADA Segment Key Figures Branded Products

 
Q3/2017
Q3/2016
+/-
1-9/2017
1-9/2016
+/-
Sales, reported
EUR 235.0 million
EUR 202.6 million
+16%
EUR 703.8 million
EUR 609.9 million
+15%
Sales, adjusted
EUR 232.2 million
EUR 202.6 million
+15%
EUR 680.3 million
EUR 609.9 million
+12%
EBITDA, adjusted
EUR 70.1 million
EUR 52.5 million
+33%
EUR 191.5 million
EUR 161.1 million
+19%
EBITDA margin, adjusted
29.8%
25.9%
 
27.2%
26.4%
 

 

Sales development Branded ProductsReported sales of the Branded Products segment increased by 16 percent to Euro 235.0 million in the third quarter of 2017. Sales adjusted for portfolio and currency effects increased by 15 percent to Euro 232.2 million. In the first 9 months of 2017, reported sales of the Branded Products segment increased by 15 percent to Euro 703.8 million. Sales adjusted for portfolio and currency effects grew by 12 percent to Euro 680.3 million. The positive development primarily resulted from strong growth in segment sales in Russia and an increased sales contribution from the Serbian subgroup. In total, Branded Products contributed 41.4 percent to Group sales in the first nine months of 2017 (1-9/2016: 39.6 percent).

Country development Branded Products
Within the Branded Products segment, the five largest countries according to sales developed as follows in the third quarter of 2017 and the first nine months of 2017:

 
Q3/2017
Q3/2016
+/-
1-9/2017
1-9/2016
+/-
Russia
EUR 60.3 million
EUR 41.7 million
+45%
EUR 168.3 million
EUR 101.8 million
+65%
Germany
EUR 48.6 million
EUR 42.9 million
+13%
EUR 140.0 million
EUR 143.1 million
-2%
United Kingdom
EUR 35.0 million
EUR 34.6 million
+1%
EUR 117.1 million
EUR 118.2 million
-1%
Italy
EUR 10.9 million
EUR 8.6 million
+27%
EUR 32.5 million
EUR 30.1 million
+8%
USA
EUR 9.8 million
EUR 8.5 million
+15%
EUR 27.4 million
EUR 22.7 million
+21%

 

Country development Branded Products in the first nine months of 2017Russia: Most of the sales increase was attributable to growth in volume, particularly for some of the key brands which were out-of-stock in the previous year. Germany: Third quarter sales were strong due to the early delivery of cough & cold products as well as some launches; however the year-to-date sales were lower than the corresponding period of the previous year, partly because of a high comparative base, and partly due to a decline in sales of the Parkinson's treatment APO-Go in Germany. United Kingdom: This sales increase was mainly attributable to the two acquisitions, BSMW and Natures Aid. Italy: The sales increase was particularly attributable to a reorganization of sales structures carried out at the end of 2016. USA: The sales growth resulted from the good development of Parkinson's treatment APO-Go.

EBITDA and margin development Branded Products
The adjusted EBITDA of Branded Products increased by 33 percent to Euro 70.1 million in the third quarter of 2017 and by 19 percent to Euro 191.5 million in the first nine months of 2017. This development was particularly attributable to strong sales development and positive foreign exchange translation effects in Russia. The adjusted EBITDA margin of Branded Products improved to 29.8 percent in the third quarter of 2017 (Q3/2016: 25.9 percent) and was 27.2 percent in the first nine months of 2017 (1-9/2016: 26.4 percent).

STADA reconciliation - special items third quarter of 2017

in EUR million1
Third quarter of 2017,
reported
Write-downs/ write-
ups
on non-current assets
Effects from
purchase price
allocations
and
acquisitions2
Consultancy services in connection with the takeover process
Reversal of tax provisions
Third quarter of 2017,
adjusted
Earnings before interest, taxes, depreciation and amortization (EBITDA)
99.4
--
-0.3
10.7
--
109.8
Balance from depreciation/amortization and impairments/write-ups on intangible assets (including goodwill), property, plant and equipment and financial assets
 
31.9
-2.3
-3.6
--
--
26.1
Financial income and expenses
-10.3
--
--
--
--
-10.3
Taxes on income
37.9
0.4
0.4
3.0
--
41.7
Result distributable to non-controlling shareholders
0.4
0.0
0.1
--
--
0.5
Result distributable
to shareholders
of STADA Arzneimittel AG (net
income)
18.9
1.9
2.8
7.7
--
31.2

 

1 As a result of the presentation in Euro million, deviations due to rounding may occur in the tables.
2 Relates to additional scheduled depreciation and other measurement effects due to purchase price allocations as well as significant product acquisitions taking financial year 2013 as basis.STADA reconciliation - special items nine months 2017

in EUR million1
9 months 2017,
reported
Write-downs/ write-
ups
on non-current assets
Effects from
purchase price
allocations
and
acquisitions2
Consultancy services in connection with the takeover process
Reversal of tax provisions
9 months 2017,
adjusted
Earnings before interest, taxes, depreciation and amortization (EBITDA)
320.3
--
-0.6
27.8
--
347.5
Balance from depreciation/amortization and impairments/write-ups on intangible assets (including goodwill), property, plant and equipment and financial assets
 
111.1
-20.5
-12.6
--
--
78.0
Financial income and expenses
-31.9
--
--
--
--
-31.9
Taxes on income
62.8
3.7
1.5
7.8
10.4
86.2
Result distributable to non-controlling shareholders
5.4
0.3
0.3
--
--
6.0
Result distributable
to shareholders
of STADA Arzneimittel AG (net
income)
109.2
16.5
10.1
20.0
-10.4
145.4

 

1 As a result of the presentation in Euro million, deviations due to rounding may occur in the tables.
2 Relates to additional scheduled depreciation and other measurement effects due to purchase price allocations as well as significant product acquisitions taking financial year 2013 as basis.

Note: STADA has two subsidiaries in Vietnam: Pymepharco Joint Stock Company and STADA Vietnam J.V. Co. Ltd. As a result of financial reports, which have not been available since April 2017 for STADA Vietnam J.V. Co. Ltd., STADA has decided to use the last available planning figures for the second quarter of 2017 and not to include any financial information for STADA Vietnam J.V. Co. Ltd. for the third quarter of 2017.

Contact:
STADA Arzneimittel AG / Investor Relations / Leslie Iltgen / Stadastraße 2-18 / 61118 Bad Vilbel / Germany
Phone: +49 (0) 6101 603-173 / Fax: +49 (0) 6101 603-215 / E-mail: leslie.iltgen@stada.de
Or visit us in the Internet at www.stada.com.












09.11.2017 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de

Language:
English
Company:
STADA Arzneimittel AG

Stadastraße 2-18

61118 Bad Vilbel


Germany
Phone:
+49 (0)6101 603- 113
Fax:
+49 (0)6101 603- 506
E-mail:
communications@stada.de
Internet:
www.stada.de
ISIN:
DE0007251803, DE0007251845,
WKN:
725180, 725184,
Indices:
MDAX
Listed:
Regulated Market in Dusseldorf, Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange

 
End of News
DGAP News Service




626591  09.11.2017 





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