Catalent(CTLT) - 2024 Q4 - Annual Report

Revenue and Financial Performance - Revenue and net earnings are typically higher in the third and fourth fiscal quarters, with the first quarter generating the lowest revenue and the last quarter the highest, primarily due to seasonality in operational maintenance, pharmaceutical and biotechnology spending, and product demand[68] - The company's backlog as of June 30, 2024, was $2.34 billion, compared to$ 2.53 billion in 2023, with 78% expected to be recognized as revenue by the end of fiscal 2025[70] - The company has invested $1.56 billion in manufacturing and development facilities since fiscal 2022, including$ 327 million in capital expenditures during fiscal 2024[73] Operational Excellence and Delivery - The company achieved approximately 96% on-time shipment delivery in fiscal 2024, driven by operational excellence and process standardization[74] - Research and development costs were $17 million,$ 18 million, and $23 million for fiscal 2024, 2023, and 2022, respectively[78] Workforce and Employee Engagement - As of June 30, 2024, the company had approximately 16,900 employees globally, with women representing 44% of the workforce and holding 40% of managerial roles[81] - The turnover rate decreased to 19% as of June 30, 2024, with 11% voluntary turnover, driven by voluntary departures in the U.S. and reorganizations at larger sites[82] - The company attracted over 2,400 new employees in fiscal 2024, focusing on reducing time-to-fill for open positions and improving candidate experience[83] - In fiscal 2024, over 2,100 employees moved to new roles within the organization, either as developmental moves or promotions to more senior positions[88] - The company's GOLD program, a two-year rotational program for recent graduates, is being redesigned for a relaunch in fiscal 2026[90] - In fiscal 2024, 55 current and potential general managers participated in the Senior Leader General Managers' Excellence program[92] - Since its inception, the Lead Now program has certified 420 new leaders[92] - The company-wide engagement score in October 2023 was 6.7 out of 10[97] Sustainability and Environmental Impact - Renewable electricity accounted for 80% of electricity use by the end of fiscal 2023, reducing total Scope 1 and 2 emissions by 10% from fiscal 2022[101] - Water usage in water-stressed areas was reduced by 14.4% from fiscal 2022[101] - Waste diverted from landfill increased to 85% in fiscal 2023, up from 73% in fiscal 2022[101] - Philanthropic giving exceeded$ 1.25 million in fiscal 2023[101] - 21% of employees participated in the annual Month of Service in fiscal 2023, up from 18% in fiscal 2022[101] - The company closed the U.S. gender pay gap in fiscal 2021 through EDGE certification[102] Intellectual Property and Quality Management - Catalent holds more than 2,100 patents and patent applications worldwide[110] - The company has implemented a global quality management system with employees worldwide focusing on quality and regulatory compliance[115] - The company's facilities are subject to periodic inspections by the FDA, DEA, and other regulatory authorities, with all inspection observations resolved or on track for completion[115] - The company's operations are in compliance with environmental, health, and safety regulations, with appropriate reserves recorded for potential liabilities[118] Financial Risks and Exposure - The company is exposed to interest rate fluctuations on $500 million of U.S. dollar-denominated term loans, with the variable portion effectively fixed at 0.9431% through the 2023 Rate Swap[378] - A hypothetical 50 basis point change in the variable rate component of the company's variable rate indebtedness would change annual interest expense by$ 9 million[378] - The company is exposed to foreign exchange rate fluctuations, with principal drivers including the European euro, British pound, Argentinean peso, and Brazilian real[379] - The company's foreign currency exposure includes transactional and translational risks, with financial statements of foreign operations translated into U.S. dollars using period-end exchange rates[379] - Foreign currency transaction gains and losses are included in the statements of operations, utilizing weighted average exchange rates for the period[379]