(BFM Bourse) – The group’s 2022 results are ultimately lower than the objectives and the outlook for 2023 leaves investors unmoved.
Nothing is going well on the stock market for Euroapi. This Wednesday, the action of the world leader in active pharmaceutical ingredients collapsed by 21.59% to 12.545 euros around 5:05 p.m. Here is the company almost back to the level it was at when it was listed on the stock market (12 euros) last May.
A former darling of financial analysts, Euroapi has had a series of disappointments for several months. And the 2022 annual results unveiled on Wednesday did not reassure investors. However, the former subsidiary of Sanofi manages to post an 8.5% growth in its turnover, which reached 976.6 million euros.
Except that in its latest forecasts dating from last December, Euroapi had already slashed its objectives (1 billion euros originally) and was aiming for 980 million euros. So it does even worse.
Growing losses
Similarly, Ebitda (earnings before interest, taxes, depreciation and amortization) is disappointing. Euroapi posted a “core Ebitda” of 120 million euros (excluding restructuring and similar costs of 26.3 million euros). That is a core Ebitda margin representing 12.3% of revenues, against an original target of 14% (reduced to between 12 and 13% last December).
Finally, Euroapi posted a net loss of 15 million euros over the year, compared to a consolidated loss of 8.1 million euros in 2021. “Excluding the impact of the impairment of Brindisi assets in the amount of 21 .8 million euros, without cash impact, and the impairment of deferred tax assets of -7 million euros, net income for the 2022 financial year would have been 13.8 million euros. , however, specifies the group in a press release. The Brindisi plant in Italy was restructured to switch from production of anti-infectives intended for the API Solutions activity to a fermentation activity for the CDMO.
The API Solutions activity corresponds to active pharmaceutical ingredients “resulting from its sales activity to third parties, for which the intellectual property is owned by the group or licensed by the group and/or covered by a distribution contract”, specified Euroapi during its IPO. The CDMO activity, for its part, corresponds to “development and/or manufacturing services” of active pharmaceutical ingredients “for which the intellectual property is held by the group’s customers”.
Partial closure of a factory in Budapest
The group’s performance in 2022 was notably weighed down by the closure of a production line at the end of the year. At the beginning of last December, the former subsidiary of Sanofi had indeed had to suspend part of its production on its site in Budapest, Hungary, the group having noted “certain deviations from good manufacturing practices, relating to the management of the documentation”. Production has since resumed gradually.
“For this first year as an independent company, Euroapi recorded a solid performance, driven by the very good momentum of the CDMO activity (+18.3%, editor’s note) and by the strong contribution of the API Solutions activity ( +5.3%, Editor’s note). The implementation of our strategy is on track and we are satisfied with the progress made in large molecules. We have initiated major projects in 2022, notably by announcing a series of strategic investments for vitamin B12 and for peptides and oligonucleotides. We have also limited the effect of unfavorable external factors by increasing prices and improving our efficiency”, said Karl Rotthier, CEO of Euroapi, in the press release.
The outlook for 2023 also visibly lacks ambition for investors. Euroapi aims for growth in turnover of “between +7% and +8%”, a core Ebitda margin of between 12 and 14% and investments of between 120 and 130 million euros. Not enough to restore the balm to the heart of the markets.
Jean-Louis Dell’Oro – ©2023 BFM Bourse
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