Fagron delivers solid results in exceptional 2020
Regulated information
Nazareth (Belgium)/Rotterdam (The Netherlands), 11 February 2021
Fagron delivers solid results in exceptional 2020
Turnover up 4.0%; REBITDA increased 5.9% to € 123.9 million
Financial highlights of 2020
- Turnover increased 4.0% to € 556.0 million (+12.3% CER1)
- REBITDA2 increased 5.9% to € 123.9 million (+14.6% CER)
- Recurrent net profit up 8.3% at € 62.9 million
- Strong operating cash flow of € 93.0 million
- Net financial debt/REBITDA ratio of 2.06 at end-2020
- Dividend proposal of € 0.18 per share
Strategic and operational highlights
- Impact of COVID-19 pandemic differs by region and country, overall impact limited
- Integration of acquisitions in Germany and Israel started
- Operating working capital improved to 8.8% of turnover
Rafael Padilla, CEO of Fagron: “I am incredibly proud of the nearly 3,000 Fagron colleagues who made a tremendous effort during this challenging year in which we were able to realize an excellent result despite the postponement of elective care and various periods of lockdown. Our results are not only proof of the strong resilience of our business, partly thanks to our broad diversification in terms of products and regions, but also underline our relevance as an essential link in the healthcare chain. Also thanks to our broad network of suppliers and robust supply chain we have been able to serve our customers efficiently and without disruption.
Throughout the year we were confronted in all our markets with waves of infection and related measures aimed at controlling COVID-19. These unfolded differently in the various regions, with the common factor being that demand for corona-related products kept pace with the increase in the number of cases, while elective care was scaled back. At the same time the COVID-19 pandemic demonstrated the importance of prevention and personalized treatment: a confirmation of our strategic proposition. The consequence of these developments was that Brands and Essentials were able to benefit from growth opportunities, thus offsetting the decline at Compounding Services due to reduced activity in elective care.
The pattern described above is clearly reflected in the results of the regions. Fagron Latin America, which is mainly active in Brands and Essentials, realized growth of 33.9% at constant exchange rates, despite exceedingly challenging market conditions. Fagron EMEA saw turnover growth of 4.9% at constant exchange rates. Compounding Services accounts for a larger proportion of the activities in this region, making it harder to offset the impact of the scaling back of elective care and postponement of doctor’s visits. Fagron North America realized very strong turnover growth in Brands and Essentials, amply offsetting the slight decline in Compounding Services. Fagron Sterile Services in the United States once again had some promising product launches, such as the launch of prefilled intravenous (IV) bags in the fourth quarter. Overall Fagron North America reported turnover growth of 11.5% at constant exchange rates – an excellent performance, certainly in combination with the strongly improved REBITDA margin.
Innovation remains a key driver of our growth and despite the unprecedented circumstances we continued to focus on this throughout the year. We brought various new products to market, including specific sterile compounds, where the high demand from intensive care units for the treatment of COVID-19 patients had led to shortages. Another focus in our development pipeline are products aimed at prevention, for example immune system boosters. In addition, Fagron is actively pursuing acquisition opportunities that develop in the current market dynamics, with a particular focus on EMEA and North America.
Fagron has demonstrated that it is a sound and versatile organization that can respond effectively to changing market conditions. The company is excellently positioned to benefit from the even stronger focus on prevention and lifestyle. Also, the accelerated outsourcing of sterile compounding by hospitals will contribute to the further growth of Fagron. Although visibility is limited due to COVID-19, which will have an impact particularly in the first quarter of 2021, we expect growth in both turnover and profitability for the full year 2021. We look ahead to the future of Fagron with great confidence.
For more information
Constantijn van Rietschoten
Chief Communications Officer
Tel. 85
1 CER = Constant exchange rates.
2 EBITDA before the non-recurring result.
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