(New: Statements from video conference, share price, analysts and more background.)

GÖTTINGEN (dpa-AFX) - Pharmaceutical and laboratory equipment supplier Sartorius is adjusting to a slower pace after a strong year. Demand, which rose sharply due to the pandemic, is now coming back to normal levels. Nevertheless, business is flourishing at the Goettingen-based company - also because the Group is constantly expanding its product range through acquisitions in order to keep pace with trends in the pharmaceutical and biotech industries. In 2023, the company's CEO Joachim Kreuzburg plans to continue investing in expanding capacities and to make further acquisitions. In addition, Sartorius raised its medium-term targets until 2025 when it presented its preliminary annual figures. This caused the share price to jump on the stock market.

Shortly after the start of trading, Sartorius preference shares, which are listed on the Dax, climbed more than eight percent to their highest level since September - the last time the share led the German benchmark index with a gain of around 5.7 percent to 430.60 euros. Since the turn of the year, the shares have thus gained a good 16 percent. Nevertheless, the development is not likely to satisfy everyone, as the stock has now come a long way from the record high in the wake of the Corona pandemic at just under 632 euros towards the end of 2021.

Analyst Odysseas Manesiotis from private bank Berenberg spoke of solid results for 2022 and a decent business outlook in relation to market expectations. Warburg expert Michael Heider criticized the somewhat weaker-than-expected outlook for 2023, but the updated medium-term target points to continued growth.

The tenor at U.S. investment bank JPMorgan was similar: industry expert Richard Vosser estimates that market expectations for operating profit in 2023 will fall by six percent. On the other hand, the laboratory equipment supplier's statements for development through 2025 should provide confidence in the market, the analyst said.

For 2023, Sartorius is targeting sales revenue growth on a constant currency basis in the low single-digit percentage range, as reported by Sartorius in Goettingen, Germany. The background to this is also a drop in order intake, after the Lower Saxony-based company had still benefited exceptionally strongly from demand from vaccine manufacturers during the corona pandemic. Excluding the corona-related business, sales revenue is expected to grow in the upper single-digit percentage range in 2023. In 2022, however, Sartorius had still posted double-digit percentage growth.

In the new year, the Group expects to generate almost no more sales revenue from corona-related business, as Kreuzburg further explained. In 2021, Sartorius had still generated around half a billion euros in pandemic-related sales revenue - last year, revenue from this business already dropped to around 220 million euros.

However, the rest of the business was humming. Despite the current challenging environment, Sartorius grew across its entire portfolio and all regions, it said. According to preliminary calculations, sales revenue at the DAX-listed company rose 21 percent year on year to just under 4.2 billion euros in 2022; adjusted for exchange rate effects, this was an increase of 15 percent. Adjusted earnings before interest, taxes, depreciation and amortization (adjusted Ebitda) climbed by a fifth to a good 1.4 billion euros.

Below the line, adjusted net income reached 655 million euros, an increase of a good 18 percent compared to the previous year. The Group plans to present its annual report with the final figures on February 17.

In addition to the loss of the Corona business, Kreuzburg explained the comparatively cautious statements on 2023 with another effect: During the pandemic, Sartorius had additionally benefited from a change in the ordering behavior of customers, who placed larger orders right away and ordered further in advance than usual. This situation is now changing, also because the stressed supply chains have largely relaxed, Kreuzburg said. "Customers are driving their inventories back to normal levels." As a result, order intake fell by a good six percent overall to about four billion euros in 2022.

The Biotechnology Division, which is mainly managed under the umbrella of the French subsidiary Sartorius Stedim Biotech, felt the brunt of the lower bookings. However, it had also benefited more from the pandemic. Nonetheless, the division with technologies for the manufacture of vaccines and pharmaceutical products was able to post double-digit percentage increases in both sales revenue and operating profit in 2022.

The much smaller laboratory division also flourished in 2022 - here, order intake picked up in contrast to the larger biotech pillar. According to the figures, business with bioanalytical instruments grew particularly strongly. The Executive Board headed by Kreuzburg expects the Laboratory Division to grow faster than the biotechnology business in 2023.

Sartorius had recently responded to rising costs and inflation with price increases - the Group therefore raised its sales revenue target by 2025 from around 5 to now 5.5 billion euros. The adjusted operating margin (adjusted Ebitda margin) is expected to come out unchanged at around 34 percent. The Group is currently one year ahead of its medium-term plan due to the positive effects of the Corona pandemic, Kreuzburg continued. With the tailwinds subsiding, the Group is approaching this again, he added.

To achieve its goals, Sartorius spent a lot of money on new technologies and acquisitions in recent years. With the momentum of the Corona pandemic, capacities were once again vigorously expanded worldwide and capital expenditures were substantially increased. In 2022, they amounted to 523 million euros, and Kreuzburg is aiming for around half a billion euros in 2023. Capacities will be expanded primarily in Germany, France and Korea.

In addition, the Group intends to continue its purchasing spree. Currently, Sartorius is interested in technologies for accelerating analytical processes, for example, said the CEO. Only recently, Sartorius announced a ten-percent stake in the Swedish Bico Group as part of a cooperation on 3D cell printing processes./tav/mis/jha/