Thursday, November 4th, 2021
Rapid test earnings are falling
Healthineers is planning again without a corona booster
Siemens Healthineers made more than a billion euros with rapid tests. But this special boom is coming to an end. The company therefore expects lower growth in the new year. Great hopes rest on the latest billions in purchases.
The medical technology subsidiary of Siemens is preparing for slow growth after the end of the special Corona economy. The billion-dollar business with rapid antigen tests helped Siemens Healthineers achieve record sales and profits in fiscal year 2020/21 (as of the end of September), as the company announced in Erlangen. There were also catch-up effects because doctors and hospitals had invested less in the first phase of the pandemic.
For 2021/22, Siemens Healthineers boss Bernd Montag expects – excluding the rapid test effect – with a normalization: The sales growth of five to seven percent is then only half as high as in the previous fiscal year. Adjusted net earnings per share are expected to increase by around a fifth.
Above all, the $ 16.4 billion takeover of US cancer treatment specialist Varian should then help Siemens Healthineers on the jumps. The Americans are expected to contribute 2.9 billion to 3.1 billion euros in sales, with an operating return of 15 to 17 percent, which is set to rise to 20 percent and more in a few years. When exactly will be revealed on Monday on November 17th on an investor’s day. He referred to incoming orders of more than 20 billion euros. However, the imaging division (CT, MRT, X-ray) is to remain the driving force for the time being, the margin of which is to improve to 22 to 23 (previous year: 21.1) percent.
The business with corona tests, on the other hand, is slowly coming to an end. In the past financial year alone, they had delivered 1.1 billion euros in sales and a net profit of 340 million euros. In 2021/22, CFO Jochen Schmitz expects only 200 million euros in sales with the tests that Siemens Healthineers had delivered primarily to government agencies. In addition, prices are crumbling: While Healthineers initially received more than five euros per rapid test, tenders are currently asking for less than 1.50 euros.
In 2020/21, Siemens Healthineers reached the upper end of its own forecasts, but fell short of analysts’ expectations. On a comparable basis, sales soared by almost a fifth to 18 billion euros. The adjusted earnings (EBIT) shot up by 40 percent to more than 3.1 billion euros, but analysts had given the company an average of 3.25 billion euros. CFO Schmitz explained the difference primarily with special bonuses of 56 million euros, which the workforce received for their work in the Corona crisis. The bottom line was a profit of almost 1.8 billion euros – almost a quarter more than a year earlier. The dividend is to be increased by five to 85 cents. Here, too, analysts had hoped for more.