Eurofins Scientific Se · EURONEXT:ERF
Eurofins Scientific — H1 2024 Earnings Presentation
27 slides from Eurofins Scientific's earnings presentation, Jul 24, 2024
Slide 1: H1 2024 Results Presentation
CONFIDENTIAL AND PROPRIETARY - © Eurofins Scientific (Ireland) Ltd, 2024. All rights reserved. This document contains information that is confidential and proprietary to Eurofins Scientific SE and / or its affiliates and is solely for the use of the personnel of Eurofins Scientific SE and all its af
Slide 2: Disclaimer
Disclaimer This presentation does not constitute or form part of, and should not be construed as, an offer or invitation to subscribe for or purchase securities in Eurofins Scientific S.E. and neither this document nor anything contained or referred to in it shall form the basis of, or be relied on
Slide 3: Agenda
Agenda I. Highlights II. Financial review III. Innovation IV. Outlook & summary CONFIDENTIAL AND PROPRIETARY - © Eurofins Scientific (Ireland) Ltd [2024]. All rights reserved. Any use of this material without the specific permission of an authorized representative of Eurofins Scientific (Ireland) Lt
Slide 4: I. Highlights
I. Highlights CONFIDENTIAL AND PROPRIETARY - © Eurofins Scientific (Ireland) Ltd [2024]. All rights reserved. Any use of this material without the specific permission of an authorized representative of Eurofins Scientific (Ireland) Ltd is strictly prohibited. 4
Slide 5: Strong set of results in H1 2024
Strong set of results in H1 2024 Key highlights Strategic highlights Performance in H1 2024 driven by improvement in all regions and Continuing to invest in long- especially in Europe term value creation In €m except otherwise stated H1 2023 H1 2024 +/- % • Strong pace of acquisitions so far in • So
Slide 6: Second consecutive semester of solid margin expansion
Second consecutive semester of solid margin expansion Adjusted EBITDA (€m) +220bps +120bps Margin Drivers behind year-on-year margin expansion of +220bps in H1 2024: 22.1% Margin • Core Business organic growth of 21.9% +5.6%1 • Combination of pricing attainment, Margin volume growth and disciplined
Slide 7: Organic growth by activity
Organic growth by activity Revenues (€m) Commentary • Food and Feed Testing: In Europe, recovery in growth supported by pricing attainment as well as Core Business1 some volume increases driven by product development by food producers. In North America, the organic growth business grew strongly driv
Slide 8: Expanding proportion of owned sites in our global laboratory network
Expanding proportion of owned sites in our global laboratory network Some examples of new owned site locations added in H1 2024 Highlights South Bend, Indiana Moss, Norway Tamworth, UK Environment Testing Food & Feed Testing Forensic Services • Net surface area increase of 45,000m2 in H1 2024, prima
Slide 9: Start-ups continue to contribute materially to growth, but losses are on the decline
Start-ups continue to contribute materially to growth, but losses are on the decline Long track record Strategic rationale Contributions by start-ups in H1 2024 Number of start-ups initiated Complements M&A strategy: • When acquisitions are too expensive or Organic growth contribution Programme Tota
Slide 10: 15 acquisitions closed in H1 2024 to augment technological capabilities and footprint
15 acquisitions closed in H1 2024 to augment our technological capabilities and global footprint Acquired companies generated revenues of €132m in FY 2023 Cost of €246m reflects sales multiple of 1.9x North America Europe Rest of the World 5 acquisitions 9 acquisitions 1 acquisition Acquired: Acquir
Slide 11: II. Financial review
II. Financial review CONFIDENTIAL AND PROPRIETARY - © Eurofins Scientific (Ireland) Ltd [2024]. All rights reserved. Any use of this material without the specific permission of an authorized representative of Eurofins Scientific (Ireland) Ltd is strictly prohibited. 11
Slide 12: H1 2024 results well ahead of H1 2023
H1 2024 results well ahead of H1 2023 Half Year 2024 Half Year 2023 +/- Δ +/- Δ (€m) Adjusted SDIs Reported Adjusted SDIs Reported Adjusted Reported • Revenues increased y-o-y supported by Results2 Results Results2 Results Results Results solid organic growth in the Core Business of 5.6%1 and a stro
Slide 13: Revenue bridge
Revenue bridge 3,419 (€m) H1 2024: zero H1 2023: just under €20m • FX headwind of 0.5% due to strength 3,237 of the Euro against numerous Asian 3,209 currencies • Organic revenue growth in the Core Business (excluding COVID-19 related clinical testing and reagent revenues) was +5.6%1 H1 2024: +5.6%1
Slide 14: Financial performance by operating segment
Financial performance by operating segment Europe North America Rest of the World (€m) H1 2024 H1 2023 Δ H1 2024 H1 2023 Δ H1 2024 H1 2023 Δ Revenues 1,748 1,622 +5.6%1 1,311 1,243 +4.9%1 360 344 +7.9%1 Reported EBITDA 292 217 +34.4% 356 313 +13.6% 84 66 +26.8% Reported EBITDA margin 16.7% 13.4% +33
Slide 15: H1 2024 cash flow overview
H1 2024 cash flow overview H1 2023 H1 2024 Δ Δ% • Improved FCFF year-on-year €m €m €m driven by an increase in EBITDA, Change in net working capital -154 -78 +77 continued capex discipline for Income taxes paid -88 -98 -10 programmes related to capacity expansion and improved net Net cash provided b
Slide 16: Continued investment to expand and enhance physical and technological presence
Continued investment to expand and enhance our physical and technological presence Infrastructure1 & IT² capex (€m) Net operating capex 9.6% H1 2024 capex split: 645 8.3% • 75% Net operating capex: Capex/Sales: 7.2% 544 o 21% IT 482 o 44% Machinery & Net operating Laboratory Equipment capex €459m Ne
Slide 17: Net working capital
Net working capital 2.4% 2.3% NWC intensity 2.0% Inventory 6.8% 6.3% €159m €150m €142m 6.5% H1 2022 H1 2023 H1 2024 • Net working capital at 6.3% of revenues 22.3% 20.7% 20.1% • Lower DSOs2 at 59 days vs 60 receivable1 Accounts days in H1 2023 €1,471m €1,356m €1,417m €428m €446m €445m • Higher DPOs3
Slide 18: Strong credit profile and long maturities
Strong credit profile and long maturities Leverage1 Debt maturity profile2 (€m) Key Highlights Hybrid (1st call) Target range Schuldschein 1.5x-2.5x Eurobond 1.9x 2.0x 1.9x Eurofins’ balance sheet remains very solid 1.9x at the end of June 2024: 1.6x • Financial leverage1 was 1.9x at the end 1.5x <1
Slide 19: III. Innovation
III. Innovation CONFIDENTIAL AND PROPRIETARY - © Eurofins Scientific (Ireland) Ltd [2024]. All rights reserved. Any use of this material without the specific permission of an authorized representative of Eurofins Scientific (Ireland) Ltd is strictly prohibited. 19
Slide 20: Innovations
Innovations Eurofins Genoma’s Genome-Wide Non-Invasive Prenatal Tests (GW-NIPT) PrenatalSAFE® were recently acknowledged in a paper published in the journal Prenatal Diagnosis as having extremely high clinical utility. Eurofins Discovery launched DiscoveryAI™ SAFIRE, an advanced platform DiscoveryAI
Slide 21: IV. Outlook and summary
IV. Outlook and summary CONFIDENTIAL AND PROPRIETARY - © Eurofins Scientific (Ireland) Ltd [2024]. All rights reserved. Any use of this material without the specific permission of an authorized representative of Eurofins Scientific (Ireland) Ltd is strictly prohibited. 21
Slide 22: 2024 and 2027 objectives
2024 and 2027 objectives (€m) FY 2024 Mid-term objectives FY 2027 +6.5% organic growth p.a. Revenues €7.075bn – €7.175bn €250m revenues added from M&A p.a. Approaching €10bn Adj. EBITDA €1.525bn – €1.575bn Continued growth investments in: Margin: 24% Ownership of strategic sites FCFF before investme
Slide 23: Summary
Summary Financial achievements in H1 2024 Strategic achievements in H1 2024 • Total revenues of €3,419m represented a new record level for the first half of • Strong pace of acquisitions, with 15 business combinations closed that a fiscal year, supported by solid organic growth in the Core Business
Slide 24: Q&A
Q&A CONFIDENTIAL AND PROPRIETARY - © Eurofins Scientific (Ireland) Ltd [2024]. All rights reserved. Any use of this material without the specific permission of an authorized representative of Eurofins Scientific (Ireland) Ltd is strictly prohibited. 24
Slide 25: Appendix
Appendix CONFIDENTIAL AND PROPRIETARY - © Eurofins Scientific (Ireland) Ltd [2024]. All rights reserved. Any use of this material without the specific permission of an authorized representative of Eurofins Scientific (Ireland) Ltd is strictly prohibited. 25
Slide 26: Breakdown of Revenue by Operating Segment in H1 2024
Breakdown of Revenue by Operating Segment in H1 2024 Organic growth €m H1 2024 As % of total H1 2023 As % of total Y-o-Y variation % in the Core Business* Europe 1,748 51% 1,622 51% 7.7% 5.6% North America 1,311 38% 1,243 39%** 5.5% 4.9% Rest of the World 360 11% 344 11% 4.5% 7.9% Total 3,419 100% 3
Slide 27: Definitions / Alternative Performance Measures (APMs)
Definitions / Alternative Performance Measures (APMs) APMs used in this presentation Adjusted results – reflect the ongoing performance of the mature and recurring activities excluding “separately disclosed items”. Separately disclosed items (SDI) – include: • one-off costs from integration and reor