BERLIN (Reuters) – Merck KGaA raised its outlook after posting forecast-beating second quarter profits on Thursday, boosted by demand for its lab gear and supplies from pharma companies making treatments and vaccines against the coronavirus.
Adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 46.7% to 1.6 billion euros ($1.89 billion), above the consensus estimate of 1.46 billion euros in a poll of analysts shared by the company.
“We have succeeded in mobilizing for accelerated, efficient growth in all business sectors,” said CEO Belen Garijo, highlighting the contribution of Merck’s ‘Big Three’ divisions – healthcare, process solutions and semiconductor solutions.
“We are poised to deliver sustainable growth due to our optimal position to address all Covid and post-Covid macro trends,” she added.
Reported group sales increased by 18.2% in the quarter and by 23% when adjusted for currency movements. EBITDA grew by 53% on an organic basis.
Commenting on the outlook, Merck expects the recovery that began in late 2020 to continue, while its Life Sciences in particular would expect “significantly positive contributions” owing to the COVID-19 pandemic.
It now expects group net sales to grow in 2021 by 12%-14%, on an organic basis, up from a previous forecast of 10%-12%. It now sees adjusted EBITDA rising by 21%-25%, up from an earlier view of 16%-20% growth.
($1 = 0.8448 euros)
(Reporting by Douglas Busvine; Editing by Tomasz Janowski)
