At today's Annual Shareholders' Meeting of the Sartorius technology group, CEO and Executive Board Chairman Dr. Joachim Kreuzburg presented the consolidated results for the first three months of 2010. The Biotechnology Division, which operates under the name Sartorius Stedim Biotech and contributes a good two-thirds to consolidated sales, started off the year 2010 by reporting growth and further profitability gains again. After enduring a sharp decline in its business during the year of crisis in 2009 and undergoing extensive restructuring and realignment, the Mechatronics Division also reported positive results. The division posted a significant uptick in order intake, a slight increase in sales and positive earnings. "These first-quarter business results show that both divisions developed entirely within the range of our expectations, and we confirm our positive outlook for the full year," commented CEO Dr. Joachim Kreuzburg.
“These first-quarter business results show that both divisions developed entirely within the range of our expectations, and we confirm our positive outlook for the full year”
Quarterly Results in Detail
Sales Revenue and Order Intake
The Biotechnology Division generated substantial first-quarter gains in order intake and sales revenue. Order intake rose 5.8% (constant currencies: +6.7%) to 110.4 million euros; sales revenue grew 3.7% to 100.1 million euros (constant currencies: +4.8%). As expected, Sartorius Stedim Biotech received sizeable orders specifically for large bioreactors systems (equipment business), primarily from the Asian region. Accordingly, the Biotechnology Division posted its highest growth rates in Asia/Pacific.
Following a difficult year-earlier quarter, the Mechatronics Division also achieved profitable growth in the first three months of 2010. Order intake rose significantly by 7.9% (constant currencies: +9.2%) to 56.8 million euros, and sales revenue climbed from 49.5 million euros to 50.4 million euros (+1.8%; constant currencies: +2.8%). While demand for industrial weighing and control equipment was still flat, orders for laboratory instruments took off. Regional analysis shows that the Mechatronics Division was especially successful in North America and Asia/Pacific.
At the Group level, order intake for the first quarter of 2010 grew from 157.0 million euros to 167.2 million euros and thus was up 6.5% or, in constant currencies, up 7.6%. Consolidated sales revenue rose 3.0% (constant currencies: +4.1%) to 150.4 million euros.
Both divisions contributed to the positive development of operating earnings (earnings adjusted for interest, taxes and amortization and adjusted for extraordinary expenses = underlying EBITA). The Biotechnology Division increased its operating earnings from 12.8 million euros in the year-earlier quarter to 14.6 million euros and improved its corresponding margin to 14.6% (13.3%). Following losses of -1.9 million euros in the prior-year quarter, the Mechatronics Division generated positive operating earnings of 1.8 million euros for the first quarter of 2010 and increased its EBITA margin from -3.9% to +3.7%.
For the entire Group, operating earnings for the first three months of business were at 16.4 million euros, up from 10.9 million for the same period a year ago. This equates to a surge in earnings of 50.4%. The consolidated operating EBITA margin improved from 7.5% to 10.9%. Consolidated net profit adjusted for extraordinary expenses and excluding amortization rose from 2.4 million euros to 6.9 million euros. The respective earnings per share were at 0.41 euro, up from 0.14 euro for the year-earlier quarter.
Based on business results reported for the first quarter of 2010, management confirms its positive forecast for the full year. According to its prognosis, revenue growth in constant currencies for the Biotechnology Division is likely to be in the upper single-digit percentage range and its operating EBITA margin is expected to rise slightly.
For the Mechatronics Division, which is more strongly dependent on business cycles, management plans to achieve growth in constant currencies in the lower single-digit percentage range, amid a slight upturn in business as anticipated. Given the division's significantly reduced cost base as a result of extensive restructuring measures implemented in 2009, its operating EBITA margin should attain around 5%.
For the entire Group, management accordingly expects sales growth in constant currencies to be slightly above 5% and its operating EBITA margin to continue to improve by one to two percentage points (2009: 10.1%). Furthermore, management anticipates a significantly positive operating cash flow.
Resolutions of the Annual Shareholders' Meeting
In line with the proposal submitted by the Supervisory Board and the Executive Board, the Annual Shareholders' Meeting of Sartorius AG today resolved to pay dividends of 0.42 euro per preference share and 0.40 euro per ordinary share (previous year: prf. 0.42 euro; ord. 0.40 euro). The Supervisory Board and the Executive Board were granted discharge by a large majority. Some 400 shareholders attended the Annual Shareholders' Meeting in Goettingen, Germany.