Stevanato Group(US:STVN)2022-05-14 16:12Financial Data and Key Metrics Changes - For Q1 2022, revenue grew by 10% to €212.1 million, or 8% on a constant currency basis, driven by growth in both segments [27] - Adjusted EBITDA was €54 million with an adjusted EBITDA margin of 25.5% [30] - Net profit for the quarter was €27.8 million, or €0.10 diluted earnings per share, with adjusted net profit at €28.6 million and adjusted diluted EPS at €0.11 [30] - Gross profit margin was 31.8%, benefiting from a higher mix of high-value solutions, but impacted by production slowdowns and inflationary costs [29] Business Line Data and Key Metrics Changes - BDS segment revenue increased by 7% to €172.4 million, with high-value solutions growing by 37% year-over-year to €61.5 million [31] - Engineering segment revenue grew by 23% to €39.6 million, driven by strong demand for glass forming and visual inspection machines [33] - The mix of high-value solutions increased to 29% of total revenue, up from 23% last year [28] Market Data and Key Metrics Changes - Europe remains the largest market, contributing 58.5% of revenue, followed by North America at 25% and Asia Pacific at 13.4% [89] - New order intake increased by 29% to approximately €324 million, leading to a committed backlog of approximately €992 million, up from €665 million last year [13] Company Strategy and Development Direction - The company is focused on expanding its capacity for high-value solutions to meet robust customer demand, with significant investments in the U.S. and China [20][22] - Strategic partnerships, such as with Owen Mumford for auto-injectors, are aimed at enhancing integrated solutions across segments [17] - The company aims to increase the mix of high-value solutions to the mid-30% range by 2026 [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledges challenges from inflation and supply chain disruptions but remains optimistic about strong demand trends [23][24] - The company expects to maintain its full-year guidance despite lower-than-expected revenue from COVID-related products [38] - Management emphasizes a strong backlog and positive trends in various therapeutic areas, indicating confidence in future growth [47][51] Other Important Information - The Board has recommended a cash dividend of €13.5 million, subject to shareholder approval [9][10] - Capital expenditures for Q1 2022 were €53.8 million, reflecting ongoing investments in strategic growth initiatives [35] Q&A Session Summary Question: What is the embedded expectation for organic constant currency growth in the guidance? - Management expects double-digit organic growth without considering foreign exchange effects [44] Question: Are customers canceling orders or pushing them to 2023? - There have been changes in customer forecasts for COVID business, but overall demand remains strong in other therapeutic areas [50][51] Question: What is driving the strong demand for high-value solutions? - Strong demand is noted for syringes in Nexa and Alba configurations, with a focus on converting the market from glass vials to EZ-fill vials [54][55] Question: Can you provide insights on backlog growth and customer ordering patterns? - The backlog is driven by long-term demand rather than temporary spikes, with strong visibility for 2022 and beyond [78][80] Question: What updates are there on capital expansion in Italy? - The company continues to invest in Italy, with additional capacity being released regularly [92]