Lonza Cuts Guidance After 1st Half Earnings Fell Despite Higher Sales

   By David Sachs 
 

Lonza on Friday downgraded its 2023 guidance on the back of lower earnings despite higher sales in the first half of the year.

The Swiss pharmaceutical and biotech company said first-half sales rose 3.2% on year to 3.08 billion Swiss francs ($3.55 billion), but that earnings before interest, taxes, depreciation and amortization fell 3.7% to CHF899 million. Its Ebitda margin was 29.2%. The company's core Ebitda totaled CHF922 million, a drop of 6.6%. Its core Ebitda margin was 30% compared with 33.1% a year earlier.

Lonza lowered its 2023 sales targets to mid-to-high single-digit growth at constant exchange rates from high single-digit sales growth. The company now forecasts a core Ebitda margin of between 28% and 29% compared with its previous target of between 30% and 31%.

The company blamed the downgrade on current market dynamics that are hurting demand for early-stage services and nutraceutical capsules.

Lonza confirmed its mid-term sales guidance but lowered its mid-term margin outlook to between 31% and 33% from a previous range of 33% to 35%.

Write to David Sachs at david.sachs@wsj.com

(END) Dow Jones Newswires

July 21, 2023 01:47 ET (05:47 GMT)

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