Financial Data and Key Metrics Changes - In 2024, revenue grew 2% year-over-year, driven by a 6% increase in the Biopharmaceutical and Diagnostic Solutions segment, offsetting a 70% decline in the Engineering segment [8] - For Q4 2024, revenue increased 3% to €330.6 million, with a 7% increase from the Biopharmaceutical and Diagnostic Solutions segment, countering a 16% decline in the Engineering segment [26] - Net profit for Q4 totaled €48.3 million, with diluted earnings per share at $0.18, and adjusted diluted EPS at $0.19 [29] Business Line Data and Key Metrics Changes - Revenue from high value solutions grew 9% to a record €131 million in Q4, representing approximately 40% of total revenue [27] - The Biopharmaceutical and Diagnostic Solutions segment saw a 7% revenue increase to €279.4 million, primarily driven by high value syringes, despite a 14% decline in bulk and EZ-fill vials [30] - The Engineering segment's revenue decreased 16% to €51.2 million, with mixed performance across different areas [32] Market Data and Key Metrics Changes - Revenue from injectable biologics increased 24% year-over-year, representing 34% of the Biopharmaceutical and Diagnostic Solutions revenue [10] - The company anticipates a gradual recovery in vial demand throughout 2025, with expected growth in vials from mid to high single digits [60] Company Strategy and Development Direction - The company is focused on expanding high value solutions and has made significant investments in manufacturing capacity in Fisher, Indiana, and Latina, Italy [9][12] - The strategic direction includes optimizing operational efficiency and increasing production capabilities to meet growing demand for biologics [23][24] - The company aims to return to double-digit growth and expand margins by leveraging its integrated value proposition [46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence that 2025 will be significantly better than 2024, with ongoing high demand for high value products and a gradual recovery in the vial market [45][129] - The company is optimistic about the operational improvements in the Engineering segment and expects to capture future opportunities [22][46] Other Important Information - The company ended 2024 with cash and cash equivalents of €98.3 million and net debt of €335 million, indicating sufficient liquidity for strategic priorities [35] - Capital expenditures for 2024 totaled €286.6 million, with 89% allocated for growth projects [36] Q&A Session Summary Question: Vial Recovery Timeline - Management is confident that 2025 will see a gradual recovery in vial demand, with normalization expected throughout the year [51] Question: Gross Margin Dynamics - Latina is expected to achieve normal gross profit margins by the end of 2025, while Fishers is anticipated to turn positive in the second half of 2025 [54][56] Question: 2025 Vial Growth Expectations - The company models growth in vials for 2025 from mid single digits to high single digits, with sequential improvement expected [60] Question: Device Manufacturing Operations - The company is focused on providing integrated solutions, with significant investments in device manufacturing to meet customer demand [62] Question: Engineering Segment Recovery - The Engineering segment is expected to return to mid-teens operating margins as optimization efforts progress [93] Question: Fishers Facility Revenue Contribution - The Fishers facility is expected to significantly increase revenue contribution in 2025, with full capacity ramp-up projected by 2028 [99] Question: Impact of Administration Changes - The company has a robust supply chain and is well-positioned to adapt to any changes in the geopolitical environment [71][72] Question: Vial Sales Decline Details - The decline in vial sales was more pronounced in EZ-fill vials compared to bulk vials, with specific figures not disclosed [126]

Company Performance - Stevanato Group reported quarterly earnings of $0.20 per share, matching the Zacks Consensus Estimate, and showing an increase from $0.19 per share a year ago [1] - The company posted revenues of $352.68 million for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 1.85%, and up from $345.22 million year-over-year [2] - Over the last four quarters, Stevanato has not surpassed consensus EPS estimates, but has topped consensus revenue estimates three times [2] Stock Outlook - Stevanato shares have declined approximately 12.5% since the beginning of the year, contrasting with the S&P 500's decline of 0.7% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the next quarter is $0.12 on revenues of $260.58 million, and for the current fiscal year, it is $0.58 on revenues of $1.25 billion [7] Industry Context - The Medical - Drugs industry, to which Stevanato belongs, is currently ranked in the bottom 46% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment [5] - Another company in the same industry, Durect, is expected to report a quarterly loss of $0.02 per share, with revenues projected to be $6.91 million, reflecting a significant year-over-year increase [9]

Core Viewpoint - The analysis reinstates a buy rating on Stevanato Group, highlighting its position as a leading player in drug containment and delivery for life sciences and biopharmaceutical sectors [1]. Company Overview - Stevanato Group operates in the drug containment and delivery market, serving life sciences and biopharmaceutical companies [1]. Investment Analysis - The decision to reinstate the buy rating follows a stock derating, indicating a potential opportunity for investors [1].

Financial Performance - Revenue for Q3 2024 was €277.87 million, a 2% increase from €271.42 million in Q3 2023[13]. - Gross profit decreased to €74.44 million in Q3 2024, down 10% from €82.89 million in Q3 2023[13]. - Operating profit for the nine months ended September 30, 2024, was €94.29 million, a decline of 31% compared to €136.67 million for the same period in 2023[13]. - Net profit for Q3 2024 was €30.02 million, a decrease of 21% from €37.89 million in Q3 2023[13]. - Basic earnings per share for Q3 2024 was €0.11, down from €0.14 in Q3 2023[13]. - Total comprehensive income for Q3 2024 was a loss of €2.58 million, compared to a gain of €42.80 million in Q3 2023[15]. - For the nine months ended September 30, 2024, total revenue reached EUR 773,441 thousand, a 1.5% increase from EUR 764,715 thousand in the same period of 2023[53]. - Gross profit for the nine months ended September 30, 2024, was EUR 204,165 thousand, down from EUR 238,058 thousand in 2023, reflecting a decrease of 14.2%[53]. - Operating profit for the nine months ended September 30, 2024, decreased to EUR 94,285 thousand, compared to EUR 136,673 thousand in 2023, a decline of 30.9%[56]. - The net profit attributable to equity holders for Q3 2024 was EUR 30.0 million, a decline of 20.8% from EUR 37.9 million in Q3 2023[176]. Assets and Liabilities - Total assets increased to EUR 2,213,843 thousand as of September 30, 2024, up from EUR 2,071,577 thousand at December 31, 2023, representing a growth of approximately 6.85%[16]. - Total liabilities decreased to EUR 891,547 thousand at September 30, 2024, compared to EUR 938,931 thousand at December 31, 2023, a reduction of about 5.0%[16]. - Total assets as of September 30, 2024, were €2,386 billion, compared to €2,213 billion as of December 31, 2023, indicating an increase of approximately 7.8%[52]. - Total liabilities as of September 30, 2024, were €1.078 billion, compared to €891.547 million as of December 31, 2023, reflecting an increase of about 21.0%[52]. - Current financial liabilities decreased significantly to EUR 75,614 thousand as of September 30, 2024, down from EUR 143,277 thousand at December 31, 2023, a reduction of about 47.3%[16]. - Total financial liabilities decreased to EUR 364,986 thousand at September 30, 2024, from EUR 398,916 thousand at December 31, 2023[125]. Cash Flow and Investments - Net cash flows from operating activities increased to EUR 112,141 thousand, up 18.0% from EUR 95,019 thousand in the same period last year[20]. - Cash flows used in investing activities decreased to EUR (219,179) thousand, a reduction of 33.5% compared to EUR (328,937) thousand in 2023[20]. - Cash and cash equivalents increased to EUR 77,996 thousand at September 30, 2024, compared to EUR 69,602 thousand at December 31, 2023, representing a growth of approximately 12.1%[16]. - Cash and cash equivalents increased to EUR 77,996 thousand as of September 30, 2024, up from EUR 69,602 thousand at December 31, 2023, representing an increase of 12.93%[131]. - Capital expenditures related to ongoing infrastructure investments were approximately EUR 92.2 million, net of expected contributions from BARDA for the new U.S. facility[92]. Research and Development - Research and development expenses for the nine months ended September 30, 2024, were €26.10 million, slightly up from €25.61 million in the same period of 2023[13]. - Research and development expenses for the nine months ended September 30, 2024, totaled EUR 26,103 thousand, compared to EUR 25,605 thousand in 2023, indicating a slight increase of 1.9%[53]. - The company has secured a leadership position in drug development and delivery through significant investment in research and development[167]. Market and Production - The Group initiated commercial production at its new EZ-fill® manufacturing hub in Fishers, Indiana, in Q3 2024, with customer validations expected to continue into 2026[22]. - The Group has ten production plants globally, with new facilities in Piombino Dese and Latina starting commercial production in 2023[22]. - The Group is focused on expanding its global capacity for high-value solutions products[22]. - Approximately 85% of total revenue for the first nine months of 2024 came from the Biopharmaceutical and Diagnostic Solutions segment[184]. - The company operates ten production plants globally, with expansions in the U.S. and Italy to increase capacity for premium EZ-Fill® products[174]. Financial Risks - The Group is exposed to financial risks including foreign currency exchange rates, liquidity risk, credit risk, and commodity price fluctuations, which could significantly impact its financial position and cash flows[46]. - The average foreign exchange rate for the US dollar was 1.0871 for the nine months ended September 30, 2024, compared to 1.0833 for the same period in 2023, showing a slight increase[49]. Employee and Shareholder Information - The company has a Long Term Incentive Plan running from January 1, 2023, to December 31, 2027, which includes two sub-plans with performance criteria based on revenue growth and ROIC[139]. - The company granted 145,670 Performance Share Units (PSUs) and 145,670 Restricted Share Units (RSUs) in 2023, with 1,390 forfeited by year-end[147]. - At September 30, 2024, the outstanding number of PSUs was 187,909 and RSUs was 173,458[147].

Financial Data and Key Metrics Changes - For Q3 2024, revenue grew 2% to €277.9 million, with a 3% increase on a constant currency basis, driven by a 6% growth in the Biopharmaceutical and Diagnostic Solutions Segment [21] - Gross profit margin decreased to 26.8% due to temporary impacts from vial destocking and higher costs associated with ramp-up activities [22] - Net profit totaled €30 million, with diluted earnings per share at €0.11, and adjusted EBITDA was €63.7 million, resulting in an adjusted EBITDA margin of 22.9% [24] Business Line Data and Key Metrics Changes - The Biopharmaceutical and Diagnostic Solutions (BDS) segment revenue grew 6% to €233 million, driven by high-value syringes, while the Engineering segment revenue decreased 15% to €44.8 million [28][30] - Revenue from high-value solutions increased 17% to €100.4 million, representing approximately 36% of total revenue, up from 32% last year [22][28] Market Data and Key Metrics Changes - Vial revenue declined approximately 38%, with a more pronounced drop in EZ-fill vials, impacting overall margins [28][30] - The company expects vial orders to begin picking up at the end of 2024, with a gradual recovery anticipated in 2025 [12][20] Company Strategy and Development Direction - The company is implementing a business optimization plan to address current challenges and improve operational structure, aiming for long-term profitable growth [10][11] - The demand landscape for the Engineering Segment remains favorable, driven by trends such as the rise in biologics and the adoption of drug delivery devices [11][54] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the recovery of vial demand, emphasizing that the destocking is a temporary inventory normalization effect [70][71] - The company remains focused on execution and achieving long-term objectives, with expectations for improved financial performance in Fishers and Latina as capacity ramps up [39][40] Other Important Information - The company is maintaining its revenue guidance for 2024 but has lowered its outlook for adjusted EBITDA and adjusted diluted EPS due to increased costs from the optimization plan [35][36] - Capital expenditures for Q3 2024 totaled €58.8 million, reflecting ongoing investments in capacity expansion [34] Q&A Session Summary Question: Guidance for 2025 and growth expectations - Management indicated that the uncertainty in 2025 growth is related to the pace of recovery in EZ-fill and bulk vials, but they see favorable tailwinds in high-performance syringes and other product categories [42][44] Question: Visibility on destocking easing - Management characterized the market as normalizing, with gradual improvements in vial orders expected in the second half of 2024, but the timing of recovery remains uncertain [47][49] Question: Engineering segment challenges - Management acknowledged challenges in the Engineering segment but noted that they are seeing initial benefits from optimization actions and expect to return to profitability by mid-2025 [52][73] Question: Vial demand recovery - Management expressed confidence that vial demand will return to pre-pandemic levels, emphasizing that the current decline is due to inventory normalization [70][104] Question: Costs related to validation and optimization - Management clarified that additional costs are associated with validation activities in Fishers and the execution of the optimization plan in Engineering, which are expected to yield long-term benefits [88][90]

Stevanato Group Q3 2024 Financial Results November 5, 2024 Safe Harbor Statement 2 Forward-Looking Statements This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the current views of Stevanato Group S.p.A. ("we", "our", "us", "Stevanato Group" or the "Company") and which involve known and unknown risks, uncertainties and assumptions because they relate to events and depend on circumstances that will occur in th ...

Core Viewpoint - Stevanato Group reported quarterly earnings of $0.13 per share, matching the Zacks Consensus Estimate, but down from $0.16 per share a year ago [1] - The company generated revenues of $305.42 million for the quarter ended September 2024, exceeding the Zacks Consensus Estimate by 1.89% and up from $295.39 million year-over-year [2] Financial Performance - Over the last four quarters, Stevanato has not surpassed consensus EPS estimates [2] - The company has topped consensus revenue estimates two times in the last four quarters [2] - The current consensus EPS estimate for the upcoming quarter is $0.19 on revenues of $355.64 million, and for the current fiscal year, it is $0.50 on revenues of $1.2 billion [7] Stock Performance - Stevanato shares have declined approximately 29% since the beginning of the year, contrasting with the S&P 500's gain of 19.8% [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating expectations of underperformance in the near future [6] Industry Outlook - The Medical - Drugs industry, to which Stevanato belongs, is currently in the top 29% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Core Insights - Stevanato Group reported quarterly earnings of $0.10 per share, matching the Zacks Consensus Estimate, but down from $0.15 per share a year ago [1] - The company generated revenues of $279.44 million for the quarter ended June 2024, exceeding the Zacks Consensus Estimate by 1.43% and slightly up from $277.92 million year-over-year [2] - Stevanato shares have declined approximately 31.2% year-to-date, contrasting with the S&P 500's gain of 8.7% [3] Earnings Performance - Over the last four quarters, Stevanato has not surpassed consensus EPS estimates, with only one instance of exceeding revenue estimates [2] - The current consensus EPS estimate for the upcoming quarter is $0.15, with projected revenues of $312.49 million, and for the current fiscal year, the estimate is $0.53 on revenues of $1.22 billion [7] Market Outlook - The estimate revisions trend for Stevanato is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6] - The Medical - Drugs industry, to which Stevanato belongs, is ranked in the top 42% of over 250 Zacks industries, suggesting a potential for better performance compared to lower-ranked industries [8]

Core Viewpoint - Stevanato Group (STVN) is anticipated to report a year-over-year decline in earnings and revenues for the quarter ended June 2024, which could significantly impact its stock price depending on the actual results compared to expectations [2][12]. Financial Performance Expectations - The expected quarterly earnings for Stevanato are $0.10 per share, reflecting a year-over-year decrease of 33.3% [3]. - Revenues are projected to be $274.59 million, down 1.2% from the same quarter last year [4]. Analyst Sentiment and Estimates - The Most Accurate Estimate for Stevanato is lower than the Zacks Consensus Estimate, indicating a bearish outlook from analysts, resulting in an Earnings ESP of -2.44% [8]. - Over the last 30 days, the consensus EPS estimate has been revised 2.22% lower, showing a collective reassessment by covering analysts [16]. Earnings Surprise History - Stevanato has beaten consensus EPS estimates only once in the last four quarters [10]. - In the last reported quarter, the company was expected to post earnings of $0.12 per share but actually reported $0.09, resulting in a surprise of -25% [22]. Zacks Rank and Predictive Power - Stevanato currently holds a Zacks Rank of 4 (Sell), which complicates the prediction of an earnings beat [20][21]. - A negative Earnings ESP reading, combined with a low Zacks Rank, indicates a challenging outlook for the company to surpass consensus EPS estimates [19][21].

Maskot/DigitalVision via Getty Images In our last assessment, we decided to lower Stevanato Group's (NYSE:STVN) rating due to 'Destocking And Valuation Risk.' As a reminder, having checked Stevanato's peers' lower sales growth estimates in 2024 and anticipating a decline in EBITDA and net profit due to start-up costs and an unfavorable exchange rate effect, the company's valuation was full in our view. No sooner said than done. Following the FY 2023 analysis, Stevanato's share price dropped by almost 30%. T ...