Merck Kgaa · XETR:MRK
Merck Kgaa — FY2024 Earnings Presentation
51 slides from Merck Kgaa's earnings presentation, Mar 6, 2025
Slide 1: Merck delivers profitable growth
MeRck delivers profitable growth Merck FY 2024 results Belén Garijo, CEO Helene von Roeder, CFO March 6, 2025
Slide 2: Disclaimer
Disclaimer Cautionary Note Regarding Forward-Looking Statements and financial indicators This communication may include “forward-looking statements.” Statements that include words such as “anticipate,” “expect,” “should,” “would,” “intend,” “plan,” “project,” “seek,” “believe,” “will,” and other wor
Slide 3: Agenda
Agenda 01 Executive summary 02 Strategic review 03 Financial overview 04 ESG update 05 Outlook & guidance 3 Merck Q4 2024 Results Presentation | March 6, 2025
Slide 4: Executive summary
Executive summary 01
Slide 5: Merck Group – Guidance delivered
Merck Group – Guidance delivered 2024 Guidance 2024 Results Net sales €20.7 – 22.1 bn €21.2 bn ▪ Guidance: achieved ▪ Commitment met: return to profitable EBITDA pre €5.8 – 6.4 bn €6.1 bn growth in 2024 ▪ Resilience of multi- industry business EPS pre €8.20 – 9.30 €8.63 model demonstrated 5 Merck Q4
Slide 6: Strong finish to 2024 with outstanding profitable growth
Highlights: Strong finish to 2024 with outstanding profitable growth Operations Group Financials Q4 YoY organic sales growth1 Life Science: ▪ Sales growing +2%, with solid QoQ growth (+4%) ▪ PS sales growth +4% YoY and +5% QoQ; SLS up +3% Q4 organic sales: +3.8% ▪ Very strong YoY and low-teens QoQ i
Slide 7: Strategic Review
Strategic Review 02
Slide 8: Life Science: Leaving destocking behind in 2024 with H2 growth inflection
Life Science: Leaving destocking behind in 2024 with H2 growth inflection Business performance Sector focus ▪ H2 growth inflection in PS (sales +4% org.), ▪ Reaccelerating towards mid-term growth leaving customer destocking behind targets in 2025 ▪ Organic sales down -3% with Science & Lab ▪ Driven
Slide 9: Healthcare: Strong growth in CM&E and Oncology drive sector growth
Healthcare: Strong growth in CM&E and Oncology drive sector growth significantly above mid-term ambition Business performance Sector focus ▪ Strong sales growth, stringent cost focus and ▪ Strong confidence in long-term growth led transitorily lower R&D drive significant EBITDA by internal and exter
Slide 10: Electronics: Profitable growth in Semiconductor Solutions driven by AI
Electronics: Profitable growth in Semiconductor Solutions driven by AI and advanced node technologies Business performance Sector focus ▪ Semiconductor Solutions sales up +8% org; ▪ Short-term industry outlook now ~80%1 of segment sales excl. Surface ▪ Continued growth in materials needed for AI and
Slide 11: Financial overview
Financial overview 03
Slide 12: Profitable growth accelerates in Q4, across all business sectors
Profitable growth accelerates in Q4, across all business sectors Q4 YoY Net Sales Q4 YoY EBITDA pre Organic Currency Portfolio Total 19.7% €1,491 m Life Science 1.9% 0.2% 0.3% 2.5% €1,293 m -4.2% -0.2% Healthcare 6.7% -1.5% 0.0% 5.2% Electronics 2.3% -0.1% 1.4% 3.5% Merck Group 3.8% -0.5% 0.4% 3.7%
Slide 13: Life Science Q4: Accelerating momentum in Process Solutions
Life Science Q4: Accelerating momentum in Process Solutions Life Science P&L Net sales bridge [€m] IFRS Pre €2,249 m 1.9% 0.2% 0.3% €2,305 m Q4 2023 Q4 2024 Q4 2023 Q4 2024 Net sales 2,249 2,305 2,249 2,305 M&S -555 -577 -542 -561 +0.0% Q4 2023 Organic Currency Portfolio Q4 2024 Admin -115 -120 -94
Slide 14: Healthcare Q4: Strong top- and even stronger bottom-line growth
Healthcare Q4: Strong top- and even stronger bottom-line growth Healthcare P&L Net sales bridge [€m] IFRS Pre €2,032 m 6.7% 0.0% €2,137 m -1.5% Q4 2023 Q4 2024 Q4 2023 Q4 2024 Net sales 2,032 2,137 2,032 2,137 M&S -459 -462 -441 -460 Q4 2023 Organic Currency Portfolio Q4 2024 Admin -80 -86 -73 -82 R
Slide 15: Electronics Q4: Semiconductor Materials drives profitable growth
Electronics Q4: Semiconductor Materials drives profitable growth Electronics P&L Net sales bridge [€m] IFRS Pre €943 m 2.3% 1.4% €976 m -0.1% Q4 2023 Q4 2024 Q4 2023 Q4 2024 Net sales 943 976 943 976 M&S -141 -148 -140 -145 +0.0% Q4 2023 Organic Currency Portfolio Q4 2024 Admin -39 -49 -24 -34 R&D -
Slide 16: FY 2024: Overview
FY 2024: Overview Key figures Comments [€m] FY 2023 FY 2024 Δ ▪ Sales up +1% with organic growth overcompensating FX headwinds Net sales 20,993 21,156 0.8% ▪ Strong sales growth from HC and EL EBITDA pre 5,879 6,072 3.3% partially compensated by moderate sales Margin (in % of net sales) 28.0% 28.7%
Slide 17: FY 2024: Reported figures
FY 2024: Reported figures Reported results Comments ▪ EBIT slightly up, driven by top-line and [€m] FY 2023 FY 2024 Δ margin expansion in both HC and EL; EBIT 3,609 3,645 1.0% LS lower on top- and bottom-line ▪ EBIT also includes one-time Financial result -125 -108 -13.4% impairments related to HC R
Slide 18: Cash flow statement
Cash flow statement FY 2024 – cash flow statement Cash flow drivers [€m] FY 2023 FY 2024 Δ ▪ Profit after tax slightly lower on higher Profit after tax 2,834 2,786 -48 taxes D&A 1,880 2,134 254 ▪ D&A up on higher PPE and one-time impairments in relation to HC R&D Changes in provisions 188 62 -126 ▪
Slide 19: Balance sheet
Balance sheet Assets [€bn] Liabilities [€bn] 51.6 51.6 48.5 2.5 48.5 Cash & cash equivalents 2.0 3.9 Receivables 4.0 4.5 Inventories 4.6 30.0 26.8 Net equity 25.4 Intangible assets 24.4 10.3 9.9 Financial debt Property, plant 10.0 3.1 3.4 Payables/refund liabilities 9.1 & equipment 2.0 2.3 Provision
Slide 20: ESG update
ESG update 04
Slide 21: Scope 1+2 emissions nearly halved, 2030 target expected ahead of schedule
Scope 1+2 emissions nearly halved, 2030 reduction target expected to be achieved ahead of schedule Scope 1+2 vs. sales Scope 1: Reduction of -30.6% to 858 kt in 20242 ▪ Successful roll-out of NF3 reduction technology CO2 equivalents Sales drove target achievement to 49.7% reduction in 2024 vs. 2020
Slide 22: Outlook & Guidance
Outlook & Guidance 05
Slide 23: Merck Group Full-year 2025 guidance
Merck Group Full-year 2025 guidance Net sales: Organic: +3% to +6% YoY FX: -1% to +2% YoY ~€21.5 – €22.9 bn EBITDA pre: Organic: +3% to +8% YoY FX: -2% to +1% YoY ~€6.1 – €6.6 bn 23 Merck Q4 2024 Results Presentation | March 6, 2025
Slide 24: 2025 business sector guidance
2025 business sector guidance1 Net sales EBITDA pre Life Science ▪ Organic: +2% to +7% YoY ▪ Organic:+2% to +9% YoY ▪ FX: 0% to +3% YoY ▪ FX: -1% to +2% YoY ▪ ~€9.1 bn to €9.8 bn ▪ ~€2.6 bn to €2.9 bn Net sales EBITDA pre Healthcare ▪ Organic: +1% to +5% YoY ▪ Organic:+3% to +9% YoY ▪ FX: -2% to +1%
Slide 25: Appendix
Appendix
Slide 26: Additional financial guidance 2025
Additional financial guidance 2025 Further financial details Corporate & Other EBITDA pre -€550 m to -€600 m Interest result2 ~ -€110 m to -€150 m Effective tax rate ~ 21% to 23% Capex on PPE1 ~ €1.6 to 1.8 bn FY 2025 overall hedge ratio ~ 50% Hedging EUR/USD hedging @ ~ 1.08 2025 Ø EUR/USD assumpti
Slide 27: Stable dividend signals confidence in future growth
Stable dividend signals confidence in future growth Dividend1 development 2016 -2024 2024 dividend ▪ Resilient company performance supports stable dividend in FY24 2.20 2.20 2.20 ▪ Allows for dividend proposal1 of €2.20 per share for 2024 1.85 2 ▪ Dividend yield of 1.6% with payout ratio of 25.5% in
Slide 28: Geographical diversification drives resilient organic sales growth
Geographical diversification drives resilient organic sales growth Regional breakdown of net sales [€m] Regional organic development Europe +5.0% org. ▪ North America: LS sales around stable; 29% Lower sales in HC ▪ Europe: strong growth in HC and moderate growth in LS; HC growth North America acros
Slide 29: Credit details
Credit details Maturity profile as of December 31, 2024 Credit rating information Coupon [€m / $m] Last LT LT ST Rating Outlook 3.250% Rating Rating 0.125% Change A3 21.10.21 Stable P-2 3.875% 1.625% 2.875% 1.875% 1,600 0.500% 800 0.875% A 29.05.13 Stable A-1 842 0.375% 2.375% 750 750 800 500 600 63
Slide 30: Q4 2024: Overview
Q4 2024: Overview Key figures Comments [€m] Q4 2023 Q4 2024 Δ ▪ Net sales and organic sales growth up moderately with all sectors contributing Net sales 5,225 5,418 3.7% ▪ Low-double-digit growth in EBITDA pre EBITDA pre 1,293 1,491 15.3% driven by all sectors with outstanding Margin (in % of net sa
Slide 31: Healthcare and Electronics drive return to profitable growth
Healthcare and Electronics drive return to profitable growth FY YoY Net Sales FY YoY EBITDA pre Organic Currency Portfolio Total €5,879 m 6.9% €6,072 m Life Science -3.3% -0.7% 0.1% -3.9% -3.6% -0.1% Healthcare 7.0% -2.0% 0.0% 5.0% Electronics 4.6% -1.4% 0.2% 3.4% Merck Group 2.0% -1.3% 0.1% 0.8% FY
Slide 32: Q4 2024: Reported figures
Q4 2024: Reported figures Reported results Comments ▪ EBIT up low-double-digit, driven by [€m] Q4 2023 Q4 2024 Δ lower HC R&D, top-line growth in all 3 EBIT 621 824 32.6% sectors and gross margin expansion Financial result 19 -15 n.m. ▪ Unfavorable financial result mainly due to higher LTIP provisio
Slide 33: Q4 2024: Cash flow statement
Q4 2024: Cash flow statement Cash flow statement Comments [€m] Q4 2023 Q4 2024 Δ ▪ Profit after tax up due to higher Profit after tax 588 669 82 operative profits amid lower R&D costs D&A 507 551 44 ▪ D&A up driven by higher PPE following capex investments and LS impairments Changes in provisions 11
Slide 34: FY Life Science: Accelerating QoQ growth in Q4 improves YTD performance
FY Life Science: Accelerating QoQ growth in Q4 improves YTD performance Life Science P&L Net sales bridge [€m] IFRS Pre €9,281 m 0.1% €8,916 m FY 2023 FY 2024 FY 2023 FY 2024 -3.3% -0.7% Net sales 9,281 8,916 9,281 8,916 M&S -2,245 -2,238 -2,232 -2,213 FY 2023 Organic Currency Portfolio +0.0% FY 202
Slide 35: Process Solutions: Returning to growth, highest in six quarters
Process Solutions: Returning to growth, highest in six quarters Sales development [€m] - org. growth [%] YoY 938 ▪ Org. sales rise with improving volumes on higher activity levels; sales up +5% 893 896 sequentially, third quarter of sequential growth 871 ▪ Order intake, accelerating from positive tr
Slide 36: Science & Lab Solutions: Moderate YoY growth
Science & Lab Solutions: Moderate YoY growth Sales development [€m] - org. growth [%] YoY 1,170 1,192 1,167 1,137 1,143 ▪ +3% org. sales growth year-over-year; excluding SAP impact still slight growth ▪ Biomonitoring and Lab Water Solutions up org. low teens and mid-single-digits respectively ▪ Diag
Slide 37: Life Science Services: strongest quarter of year, down against high comp
Life Science Services: strongest quarter of year, down against high comp Sales development [€m] - org. growth [%] YoY 220 ▪ Sales down against high comparable 194 199 ▪ Contract testing up low-single-digit percentage org. 171 ▪ CDMO down, with high comparable in prior 157 year period ▪ Sales down in
Slide 38: FY Healthcare: Strong growth supported across franchises
FY Healthcare: Strong growth supported across franchises Healthcare P&L Net sales bridge [€m] IFRS Pre €8,053 m 7.0% 0.0% €8,455 m -2.0% FY 2023 FY 2024 FY 2023 FY 2024 Net sales 8,053 8,455 8,053 8,455 M&S -1,668 -1,713 -1,639 -1,710 FY 2023 Organic Currency Portfolio +0.0% FY 2024 Admin -314 -313
Slide 39: Healthcare organic growth by franchise/product
Healthcare organic growth by franchise/product Q4 2024 organic sales growth [%] FY 2024 organic sales growth [%] by key product [€m] by key product [€m] 184 735 1% 5% 183 713 297 1.162 22% 16% 245 1.025 270 1.062 18% 12% 232 956 147 -16% 626 -11% 175 709 192 -11% 833 1% 219 847 248 9% 954 11% 233 88
Slide 40: Oncology: Erbitux with strong contribution to +14% org. franchise growth
Oncology: Erbitux® with strong contribution to +14% org. franchise growth ® Sales development Oncology, [€m] YoY Bavencio net sales, [€m] ▪ Slightly up with double-digit 183 186 186 184 growth ex-US (esp. Europe) org. org. org. org. org. 200 180 [€m] 18.4% 19.3% 9.2% 9.1% 13.8% overcompensating decl
Slide 41: N&I: Mavenclad sales up +18% YoY amid soft comps
N&I: Mavenclad® sales up +18% YoY amid soft comps ® Sales development N&I, [€m] YoY Mavenclad Y1+Y2 patients1 ▪ Strong growth amid soft comps and solid performance across org. org. org. org. org. most regions with strong uptake [€m] -1.3% 8.8% -7.4% 6.7% 2.9% of Y1 patients 450 419 434 419 ▪ Most pr
Slide 42: Fertility: -5% org. decline against tough comps
Fertility: -5% org. decline against tough comps Sales development Fertility, [€m] YoY Gonal-f® net sales, [€m] 250 227 org. org. org. org. org. 219 204 209 [€m] 13.9% 7.7% -0.5% 1.1% -4.7% 200 192 450 150 403 400 385 383 377 100 365 50 350 ▪ Q4-23 benefitting from 0 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q
Slide 43: CM&E: Strong demand across all segments drive +8% org. franchise growth
CM&E: Strong demand across all segments drive +8% org. franchise growth ® Sales development CM&E, [€m] YoY Glucophage net sales, [€m] org. org. org. org. org. ▪ Glucophage® sales +8% org. [€m] 4.8% 4.2% 13.7% 7.8% 8.4% 247 248 driven by all regions 250 233 221 238 YoY 758 200 ▪ Approved in more than
Slide 44: Merck pipeline
Merck pipeline March 06, 2025 Healthcare pipeline Phase 1 Phase 2 Phase 3 Registration pimicotinib (CSF-1R inhibitor) Study met the primary endpoint, Tenosynovial giant cell tumor (TGCT)1 open-label part ongoing avelumab (anti-PD-L1 mAb)+Sacituzumab Govitecan / NKTR-255 / M6223 (anti-TIGIT mAb) LA o
Slide 45: Healthcare catalysts
Healthcare catalysts Q1 2025 Q2 2025 Q3 2025 Q4 2025 • SLE cohort: primary endpoint not met • Promising responses in pre-defined patient subgroups Enpatoran • Totality of data (both cohorts) and safety profile M0324 (Oral TLR7/8 inhibitor ) support further development (MUC1xCD40) Read-out - Phase II
Slide 46: Electronics FY: Strong AI-driven semiconductor materials growth
Electronics FY: Strong AI-driven semiconductor materials growth Electronics P&L Net sales bridge [€m] IFRS Pre €3,659 m 4.6% 0.2% €3,785 m -1.4% FY 2023 FY 2024 FY 2023 FY 2024 Net sales 3,659 3,785 3,659 3,785 M&S -591 -568 -588 -566 FY 2023 Organic Currency Portfolio +0.0% FY 2024 Admin -147 -166
Slide 47: Semiconductor Solutions recovery pace tempers in the near-term
Semiconductor Solutions recovery pace tempers in the near-term Sales development [€m] - org. growth [%] YoY 691 660 665 ▪ Overall, continued org. sales growth 633 642 (+5%) in Semiconductor Solutions in Q4 ▪ FY24 +8% org. sales growth in line with new +7% to +11% mid-term guide1 11% ▪ Semi Materials
Slide 48: Adjustments in Q4 2024
Adjustments in Q4 2024 Adjustments in EBIT [€m] Q4 2023 Q4 2024 Adjustments thereof D&A Adjustments thereof D&A Life Science 46 2 96 30 Healthcare 39 10 1 5 Electronics 72 23 57 16 Corporate & Other 45 1 15 2 Total 202 37 169 53 Totals may not add up due to rounding 48 Merck Q4 2024 Results Presenta
Slide 49: Adjustments in FY 2024
Adjustments in FY 2024 Adjustments in EBIT [€m] FY 2023 FY 2024 Adjustments thereof D&A Adjustments thereof D&A Life Science 122 34 220 86 Healthcare 8 10 134 160 Electronics 140 42 112 29 Corporate & Other 207 1 104 3 Total 477 87 570 277 Totals may not add up due to rounding 49 Merck Q4 2024 Resul
Slide 50: Clear metrics to drive execution towards 2030 ambition
Clear metrics to drive execution towards 2030 ambition Goal Metric 2024 (2023) Target 1 Percentage of newly published patent families with positive sustainability impact 34% (29%1) n.a. People treated with our Healthcare products* 184 mio (177 mio) 1 bn people ambition2 Pharma products enabled by Li
Slide 51: Meet the Merck team
FLORIAN SCHRAEDER NADJA GROSSCHMIDT SUSAN KUEHN eet the eRck team Head of Investor Relations Assistant Investor Relations Assistant Investor Relations +49 6151 72-5271 +49 6151 72-3321 +49 6151 72-3744 florian.schraeder@merckgroup.com nadja.grosschmidt@merckgroup.com susan.kuehn@merckgroup.com DATE