UPDATE 1-Sartorius sticks to 2022 outlook despite rising costs, Ukraine
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FRANKFURT, April 21 (Reuters) - Franco-German lab supplies group Sartorius AG stuck to its 2022 outlook on Thursday as demand remained strong in the first quarter despite uncertainties from the war in Ukraine.
Sartorius, which competes in bioreactor gear with Merck KGaA and Thermo Fisher, said underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) had increased by nearly a third from the same quarter last year to reach 349 million euros ($378.28 million).
The corresponding underlying EBITDA margin improved to 34.1%, said the company which last year entered Germany's blue-chip index DAX.
Despite rising costs for logistics and raw materials, Sartorius reiterated guidance for 2022 group sales to increase by about 15% to 19% at constant foreign exchange rates, and for the underlying EBITDA margin to match last year's level of about 34%
"Demand for our products is high in all segments, and our investments in the expansion of production capacities are making good progress," CEO Joachim Kreuzburg said.
"However, the global political and economic uncertainties have increased substantially with the outbreak of war in Ukraine, further increasing the strain on supply chains and the risks arising from significantly higher inflation rates."
Sartorius shares have slumped by about 60% from a record high in September on concern that pandemic-related demand will wane.
Investors also took a dim view of the German company's takeover interest in U.S. group Maravai LifeSciences, reported by Reuters in February.
Last year, sales surged 48% to 3.45 billion euros as the coronavirus pandemic fuelled demand from biotech businesses.
Sartorius has said it plans to invest between 550 million and 600 million euros in 2022 to meet the high demand.
The company has warned of strained supply chains, saying that microchips, specialty plastics and freight capacity were more difficult to obtain, forcing it to order earlier, at times to switch suppliers, and to accept higher costs.
"The pandemic-related effects and the development of order intake are normalising, as expected," it said on Thursday.
($1 = 0.9226 euros) (Reporting by Ludwig Burger; writing by Miranda Murray; editing by Muralikumar Anantharaman and Jason Neely)
