Financial results
for the first half of 2016
-
Order entry of CHF 250.6
million (H1 2015: CHF 220.1 million)
-
Growth of 11.3% in local
currencies or 13.9% in Swiss francs
-
Organic growth of 7.0% in local
currencies or 9.4% in Swiss francs
-
Strong increase in order
backlog
-
Sales of CHF 235.3 million
(H1 2015: CHF 200.0 million)
-
Operating profit before
depreciation and amortization (EBITDA) of CHF 37.9 million (H1
2015: CHF 32.6 million)
-
EBITDA margin of 16.1% (H1
2015: 16.3%), including integration costs and reduced margins
associated with the acquisition of Sias AG
-
Improvement in underlying
EBITDA margin, excluding Sias, of 120 basis points to
17.5%
-
Net profit of CHF 23.5
million (H1 2015 CHF 26.0 million)
-
Strong cash flow from operating
activities of CHF 64.9 million (H1 2015: CHF 35.1
million), or 27.6% of sales
-
Outlook for full-year 2016
confirmed
Operating
performance in the first half of 2016
-
Considerable progress with
integration of Sias AG, which was acquired in November
2015
-
Significant increase in serial
production of major platforms in the Partnering Business
-
Successful launch of additional
important features for Fluent® liquid
handling platforms as well as an additional Spark(TM) reader
platform model
Männedorf, Switzerland, August
16, 2016 - The Tecan Group (SIX Swiss Exchange: TECN) again
posted double-digit sales growth and a profit in line with
expectations in the first half of 2016.
Tecan CEO David Martyr commented: "I am delighted
with our continued strong sales growth in the first half of 2016
and the further improvement in underlying profitability. The
renewed high operating cash flow as well as our substantial sales
growth in Partnering Business and in both divisions in China are
particularly pleasing.
We have made considerable progress with the
integration of Sias AG, which we acquired in November 2015. Sias
was legally merged with a Tecan subsidiary in the first half of
this year. In the meantime, we have also concluded the relocation
of our new colleagues and the production lines into the Tecan
headquarters in Männedorf."
Financial results for the first
half of 2016
Order entry increased by 11.3% in local currencies
to CHF 250.6 million (H1 2015: CHF 220.1 million) in the
first six months of the year, corresponding to growth of 13.9% in
Swiss francs. On an organic basis, excluding the Sias acquisition,
orders in the first half grew by 7.0% in local currencies and by
9.4% in Swiss francs. Due to strong order entry, which once again
exceeded sales, the order backlog grew considerably.
Sales climbed by 15.0% in local currencies or
17.7% in Swiss francs to CHF 235.3 million in the first half
of the year (H1 2015: CHF 200.0 million). This corresponds to
organic sales growth of 9.2% in local currencies or 11.7% in Swiss
francs. Operating profit before depreciation and amortization
(earnings before interest, taxes, depreciation and amortization;
EBITDA) rose by 16.4% to CHF 37.9 million in the first six
months of the year (H1 2015: CHF 32.6 million). Including
integration costs and reduced margins associated with the
acquisition of Sias AG, the EBITDA margin was 16.1% of sales (H1
2015: 16.3%). By contrast, the underlying EBITDA margin, excluding
Sias, improved by 120 basis points to 17.5% of sales.
Net profit for the first half of 2016 was
CHF 23.5 million and therefore below the prior-year period (H1
2015: CHF 26.0 million). In addition to the integration costs
for the acquisition of Sias, this difference is largely due to a
substantially lower tax rate and a CHF 4.0 million higher
financial result from a temporary currency hedging profit in the
first half of 2015. The net profit margin in the first half of 2016
reached 10.0% of sales (H1 2015: 13.0%), while earnings per share
were CHF 2.04 (H1 2015: CHF 2.31)
Cash flow from operating activities grew strongly
to CHF 64.9 million (H1 2015: CHF 35.1 million) and
includes a further reimbursement of development costs by an OEM
partner. Thus, cash flow from operating activities corresponded to
27.6% of sales.
Information by business
segment
Life Sciences
Business (end-customer business)
Sales in the Life Sciences Business increased by 5.8% in local
currencies to CHF 117.7 million (H1 2015: CHF 107.5
million) in the first half of the year and were 9.5% above the
prior-year period in Swiss francs. The newly launched Fluent and
Spark platforms as well as recurring sales of services, consumables
and reagents made a considerable contribution to this growth. Order
entry in the Life Sciences Business also showed positive
development and again clearly exceeded sales in the first half of
the year.
Operating profit in the segment was CHF 12.2
million (H1 2015: CHF 11.3 million), corresponding to an
unchanged operating profit margin on the prior-year period of 9.9%
of sales (H1 2015: 9.8%).
Partnering Business (OEM business)
The Partnering Business generated sales of CHF 117.6 million
during the period under review (H1 2015: CHF 92.4 million),
which corresponds to an increase of 26.0% in local currencies or
27.2% in Swiss francs. On an organic basis, excluding sales by
Sias, revenue in the first half of 2016 rose by 13.3% in local
currencies. Instruments launched in recent years made a significant
contribution to the strong sales growth. Order entry in the
Partnering Business also grew at a double-digit percentage rate in
the first half of 2016.
The segment's operating profit in the first six
months of 2016 rose to CHF 20.9 million (H1 2015:
CHF 17.4 million). Operating profit margin was down on the
prior-year period at 17.7% of sales (H1 2015: 18.6%) mainly due to
the accounting of acquisition-related costs.
Additional information
Regional
development
In Europe, sales in the first six months in local currencies
increased by 24.2% and by 26.0% in Swiss francs. This growth was
driven primarily by the Partnering Business, both from the
first-time contribution to sales from Sias products and strong
organic growth by major platforms.
In North America, half-year sales in local
currencies were at the prior-year level, and in Swiss francs were
2.9% above the baseline from 2015. The Life Sciences Business
recorded good growth in this region. Sales in the components
business, part of the Partnering Business, declined as expected due
to the high base in the prior-year period. In addition, revenue of
the Partnering Business in North America did not benefit from a
newly launched platform for the US market, as sales were allocated
to the location of the corporate customer and therefore recorded in
Europe.
In Asia, Tecan once again achieved a considerable
increase in sales of 30.6% in local currencies and 34.7% in Swiss
francs. Both segments posted a double-digit increase in organic
sales, which was further supported by a first-time contribution to
sales by Sias products. Growth in China, where sales almost doubled
in the first six months, was particularly pleasing.
Recurring sales
of services and consumables
Recurring sales of services and consumables increased in the first
half of 2016 by 7.7% in local currencies and 10.4% in Swiss francs,
and therefore amounted to 38.3% of total sales (H1 2015:
40.9%). Services (including spare parts) accounted for 22.4%
of total sales, while consumables (plastic and reagents) accounted
for 15.9%.
Research and
development
In the first half of 2016, research and development expenses
amounted to 9.7% of sales (H1 2015: 10.0%) or CHF 22.9 million
(H1 2015: CHF 20.1 million). All told, research and
development activities continued to fall as planned to
CHF 23.7 million gross (H1 2015: CHF 30.4 million). The
total figure also includes development programs for OEM instrument
customers in the Partnering Business (CHF 4.3 million) and
capitalized development costs (CHF 2.2 million). However,
these costs were clearly exceeded by amortization amounting to
CHF 5.3 million.
Strong balance
sheet - high equity ratio
Tecan's equity ratio was 66.4% as of June 30, 2016
(December 31, 2015: 68.7%). As a result of the strong cash flow
from operating activities, net liquidity (cash and cash equivalents
minus bank liabilities and loans) increased to CHF 239.0
million (December 31, 2015: CHF 198.8 million). The company's
share capital was CHF 1,152,855 as at the reporting date of
June 30, 2016 (December 31, 2015: CHF 1,146,758), consisting
of 11,528,547 registered shares with a nominal value of
CHF 0.10.
At the Tecan Group Annual General Meeting on April 13, 2016,
shareholders approved an increase in the dividend from
CHF 1.50 to CHF 1.75 per share. The payout of dividends
of CHF 20.1 million in total took place on April 19, 2016.
Outlook for full-year 2016
confirmed
For fiscal 2016, Tecan continues to anticipate Group sales growth
in the double-digit percentage range in local currencies. This
growth will be driven by the continued ramp up of major instrument
platforms and launches of new products in both business segments as
well as a full-year contribution of Sias.
The underlying EBITDA margin, excluding the Sias
business and adjusted for tailwinds in 2015, mainly from the
one-time positive net impact of revised pension liabilities, is
expected to further expand by at least 50 basis points. Integration
costs related to the Sias acquisition are expected to reach a
mid-single-digit million Swiss franc amount in 2016 and the
acquisition to become accretive in 2017. Despite these one-time
integration costs and the lack of positive one-time effects from
2015, EBITDA for fiscal 2016 is expected to reach at least a
similar level as 2015.
These expectations regarding profitability are
based on an average exchange rate forecast for full-year 2016 of
one euro equaling CHF 1.05 and one US dollar equaling
CHF 0.98 and exclude further acquisitions.
Financial Report and
Webcast
The full 2016 Interim Report can be
accessed on the company's website www.tecan.com under Investor
Relations. An iPad app for the Tecan Financial Reports is also
available from the App Store.
Tecan will hold a conference call to
discuss the results in the first half of 2016 today at
10:00 a.m. (CEST). The presentation will also be relayed by
live audio webcast, which interested parties can access at
www.tecan.com. A link to the webcast will be provided immediately
prior to the event.
The dial-in numbers for the
conference call are as follows:
For participants from Europe: +41 (0)58 310 50 00 or +44 (0)203 059
5862 (UK)
For participants from the US: +1 (1) 631 570 5613
Participants should if possible dial in 15 minutes before the start
of the event.
Key upcoming dates
-
The 2016 Annual Report will be published on
March 15, 2017.
-
The Annual General Meeting of Tecan's
shareholders will take place on April 11, 2017.
About
Tecan
Tecan (www.tecan.com) is a leading global provider of laboratory
instruments and solutions in biopharmaceuticals, forensics and
clinical diagnostics. The company specializes in the development,
production and distribution of automated workflow solutions for
laboratories in the life sciences sector. Its clients include
pharmaceutical and biotechnology companies, university research
departments, and forensic and diagnostic laboratories. As an
original equipment manufacturer (OEM), Tecan is also a leader in
developing and manufacturing OEM instruments and components that
are then distributed by partner companies. Founded in Switzerland
in 1980, the company has manufacturing, research and development
sites in both Europe and North America and maintains a sales and
service network in 52 countries. In 2015, Tecan generated sales of
CHF 440 million (USD 459 million;
EUR 411 million). Registered shares of Tecan Group are
traded on the SIX Swiss Exchange (TECN; ISIN CH0012100191).
For further
information:
Tecan Group |
|
Dr.
Rudolf Eugster |
Martin
Brändle |
Chief
Financial Officer |
Vice
President, Communications &
Investor Relations |
investor@tecan.com |
Tel. +41
(0) 44 922 84 30 |
www.tecan.com |
Fax +41
(0) 44 922 88 89 |
Press Release with financial
tables