Merck KgaA Profit Rises, Ups Dividend; Sees Weak To Flat EBITDA Pre In FY23

(RTTNews) - German science and technology major Merck KgaA reported Thursday higher profit and revenues in its fiscal 2022, with improved performance in all divisions. The company further lifted its dividend, and said it expects weak to flat EBITDA pre in fiscal 2023, but higher organic sales.

Belen Garijo, Chair of the Executive Board and CEO of Merck, said, "We delivered profitable growth in fiscal 2022 despite challenges. The strong development of the Life Science core business more than offset the expected decline in Covid-19-related demand. Other strategic growth engines, namely new Healthcare products and our Semiconductor Solutions business unit, also performed well in fiscal 2022."

Looking ahead, Merck assumes that 2023 will be a challenging year amid the slowing semiconductor market, decreasing Covid-19-related demand and persistently high inflation.

For EBITDA pre, which will be impacted by cost inflation, Merck projects a moderate decline to an about stable development organically.

Despite this, the company sees slight to solid organic net sales growth in the year with contribution from all business sectors. The core business, without Covid-19-related sales, is likely to deliver solid to strong organic net sales growth.

Further, the company reaffirmed its mid-term financial target of 25 billion euros in net sales by 2025 based purely on organic growth.

Based on its results, the Executive Board and Supervisory Board will propose to the Annual General Meeting on April 28 a dividend of 2.20 euros per share, 19 percent more than in the previous year.

For fiscal 2022, profit after tax grew 9 percent to 3.34 billion euros from last year's 3.07 billion euros. Earnings per share went up 8.8 percent to 7.65 euros from 7.03 euros a year ago. Earnings per share pre came in at 10.05 euros, compared to previous year's 8.72 euros.

EBITDA pre rose 12.2 percent on a reported basis and 6.1 percent organically to 6.85 billion euros. Meanwhile, EBITDA pre margin fell to 30.8 percent from prior year's 31 percent.

Group net sales increased 13 percent to 22.23 billion euros from last year's 19.69 billion euros, driven by all regions and business sectors, particularly Life Science. Organically, Merck generated a 6.4 percent increase in Group sales.

The Big 3 businesses, such as Process Solutions and Life Science Services, new Healthcare products as well as Semiconductor Solutions, accounted for almost 90% of the organic growth in sales. In Germany, Merck KGaA shares were trading at 175.30 euros, down 1.04%.

For more earnings news, earnings calendar, and earnings for stocks, visit rttnews.com.