Thanks to Sigma-Aldrich, Merck increases sales, earnings
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Merck experienced currency headwinds of -4.0%.
Group net sales increased in the first quarter of 2016 by 20.5% to €3.7 billion (Q1 2015: €3.0 billion). Organically, Group sales rose by 4.7% thanks to the strong operating performance of the Healthcare and Life Science business sectors.
Sales increased by 19.8% due to acquisitions, which was primarily attributable to the purchase of Sigma-Aldrich. The acquisition closed in November 2015 and the business has now been consolidated for a full quarter for the first time. Merck experienced currency headwinds of -4.0%, which were mainly due to Latin American currencies.
In the first quarter, Merck grew organically in all reporting regions, especially in North America and Latin America. Due to the acquisition of Sigma-Aldrich, the share of sales attributable to North America rose considerably to 26% (Q1 2015: 20%). Accounting for 33% of Group sales, Europe was our largest region.
EBITDA pre exceptionals, the key earnings indicator of the Group, rose by 27.0% to €1.1 billion (Q1 2015: € 853 million) thanks to the good operational performance of Healthcare and Life Science as well as the Sigma-Aldrich acquisition.
Group EBIT rose by 76.8% to €849 million (Q1 2015: € 480 million). This includes the one-time effect of the gain of around €325 million from the sale of Kuvan, which was announced in October 2015. Merck’s net income more than doubled in the first three months of the year to €591 million (Q1 2015: €282 million). Earnings per share pre exceptionals rose in the first quarter of 2016 by 37.5% to €1.54 (Q1 2015: €1.12).
Merck has started deleveraging and reduced its net financial debt in the first quarter by €581 million to €12.1 billion. This follows the strong increase in debt at the end of 2015 due to the acquisition of Sigma-Aldrich. As with major acquisitions in the past, Merck is aiming to rapidly and extensively reduce its debt. Merck had 50,259employees worldwide on March 31, 2016. ■