By John Revill
ZURICH (Reuters) – Swiss contract drugmaker Lonza lifted its 2021 outlook on Friday after gross sales for the primary half of the yr beat analyst expectations because it advantages from a booming enterprise making substances for COVID-19 vaccines.
The corporate, which has intensified agreements with vaccine producer Moderna, posted a 13.3% soar in gross sales to 2.54 billion Swiss francs ($2.76 billion), beating analyst forecasts for two.47 billion francs.
Lonza now expects gross sales to extend in fixed alternate charges in the direction of the mid-teens share stage for 2021, up from its earlier forecast for gross sales progress within the low double-digit vary.
Core earnings earlier than curiosity, tax, depreciation and amortisation (EBITDA) rose 13% to 847 million francs, beating the 787 million francs forecast in a company-gathered ballot of analysts.
The margin dipped to 33.3% from 33.4% a yr earlier, however Lonza stated it nonetheless anticipated to enhance it this yr.
Lonza shares, which have outpaced the blue-chip Swiss Market Index by rising 19.4% in 2021, had been 2.1% increased in early buying and selling.
Buyer demand for COVID-related tasks had continued throughout the first half, the corporate stated, together with for the drug substance manufacturing of Moderna’s COVID-19 vaccine at Lonza’s websites at Visp in Switzerland and Geleen within the Netherlands.
The corporate had responded by spending 474 million francs on capex, with the overwhelming majority going in the direction of rising manufacturing ranges. Complete spending on its factories is predicted to extend within the second half of the yr, Lonza stated.
“Our COVID-related collaboration with Moderna on the mRNA platform has undergone a collection of expansions over the course of H1,” stated Chief Govt Pierre-Alain Ruffieux
“In April 2021, we expanded our collaboration to ascertain three additional manufacturing traces in Visp. We now have already began work on the set up, and we at present count on to begin ramp-up in early 2022.”
Following an extra enlargement within the Moderna settlement in June, an extra manufacturing line will likely be added at Geleen, which is able to begin ramping up manufacturing of drug substances on the finish of this yr, he added.
In addition to Moderna, Lonza has received COVID-19 contracts with AstraZeneca, Capriocor Therapeutics and Humanigen
“As we glance extra broadly at our contribution by way of the pandemic, we now have achieved our dedication to ship for patrons all through this difficult interval by increasing manufacturing and rising headcount,” the CEO stated.
($1 = 0.9200 Swiss francs)
(Reporting by John Revill; Modifying by Shailesh Kuber and Keith Weir)