Lonza Warns on 2024 Profitability Hit From Lost Moderna Revenue
By Adria Calatayud
Lonza Group warned that its profitability will take a hit next year from losing revenue from an agreement with Moderna and the risk of a smaller business with Kodiak Sciences.
The Swiss life-sciences company said Tuesday that it expects a profit margin "in the high twenties" percentage range for 2024. The company expects its core earnings before interest, taxes, depreciation and amortization margin for 2023 will be above the 28% to 29% range it had previously indicated.
Lonza said its business growth in 2024 will be also be offset by a higher comparative base from this year due to a Moderna termination agreement.
The company anticipates 2023 sales growth at constant currency will be at the higher end of its previous outlook, which called for growth in the mid-to-high single-digit percentage range.
In the third quarter, Lonza said its financial performance reflected sustained commercial demand for contract drug manufacturing, but that biotechnology funding constraints hurt growth in early-stage services in its biologics segment and led to slower sales growth in its cell-and-gene operations. The company's capsules and health-ingredients segment was hit by weakness in the U.S. nutrition-pharmaceutical market.
Looking further ahead, Lonza expects sales growth of 11% to 13%, and a core Ebitda margin of 32% to 34% over the 2024-28 period, it said.
Write to Adria Calatayud at adria.calatayud@dowjones.com
(END) Dow Jones Newswires
October 17, 2023 01:44 ET (05:44 GMT)
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