Lonza Reports Record First Quarter
• Double-digit CORE EBIT growth expected for first half of 2016
• Pharma&Biotech with further uptake in demand and strong operational performance
• Specialty Ingredients with strong results through ongoing progress in portfolio management
• Continued progress in deleveraging the company
During the first quarter of 2016, Lonza recorded its strongest first quarter in history in terms of sales and earnings. The healthy overall company performance resulted from good results in both the Specialty Ingredients and the Pharma&Biotech segments.
"These record-level results in the first quarter show that the strict market focus of our organization is producing results. The ongoing improvement projects that emphasize organic growth, stringent portfolio management and operational excellence are proving to be successful," said Richard Ridinger, CEO of Lonza. "We will use this positive start to the year to drive further our transformation initiatives with the goal of further strengthening our position as a leading supplier to the pharmaceutical, biotech and our different specialty ingredients markets."
The Pharma&Biotech segment's sales growth was driven by robust demand in Mammalian Manufacturing, Clinical Development and Emerging Technologies. The higher-than-expected growth in Emerging Technologies came specifically through contributions from cell and viral therapy applications. The significant earnings improvement was a result of the strong operational performance and ongoing cost discipline.
The strong momentum in Biologics translates into a promising pipeline going forward. Lonza plans further "brown-field expansion" projects to meet high demand.
Our healthy Bioscience Solutions business showed further improvement compared with the previous year, driven by product introductions and sound demand in all sub-segments.
Specialty Ingredients Segment
Lonza's Specialty Ingredients segment delivered robust results throughout all markets in the first quarter through ongoing progress in portfolio management to focus on higher-value activities.
Consumer Care growth was driven by ongoing demand in the Hygiene business. Integration of innovative solutions such as L-Carnitine applications in Nutrition and vitamin B3 solutions for cosmetic applications are further accelerating demand.
In Agro Ingredients Lonza experienced better sales than expected in the first quarter while softer demand is anticipated for the remainder of the year.
Coatings & Composites reported stable demand and good performance across all relevant markets.
Water Treatment's business in the first quarter was on track for the residential business while Industrial, Commercial, Municipal and Surface Water delivered a good performance overall.
With this positive start into 2016 and the good momentum already continuing into the second quarter, we expect double-digit CORE EBIT growth for first half of 2016. The record-setting performance of the company led to a healthy balance sheet in the first quarter and will support the continued deleveraging of the company.
The full-year guidance 2016 will be reviewed as part of the H1 2016 results reporting on 20 July 2016.
A Capital Markets Day for investors and analysts will be held in Portsmouth, NH (USA) on 27 October 2016.
Lonza Group Ltd.
Lonza is one of the world's leading and most-trusted suppliers to the pharmaceutical, biotech and specialty ingredients markets. We harness science and technology to create products that support safer and healthier living and that enhance the overall quality of life.
Not only are we a custom manufacturer and developer, Lonza also offers services and products ranging from active pharmaceutical ingredients and stem-cell therapies to drinking water sanitizers, from the vitamin B3 compounds and organic personal care ingredients to agricultural products, and from industrial preservatives to microbial control solutions that combat dangerous viruses, bacteria and other pathogens.
Founded in 1897 in the Swiss Alps, Lonza today is a well-respected global company with more than 40 major manufacturing and R&D facilities and approximately 9,800 full-time employees worldwide. The company generated sales of CHF 3.8 billion in 2015 and is organized into two market-focused segments: Pharma&Biotech and Specialty Ingredients. Further information can be found at www.lonza.com.