Olivier Calvet

Olivier Calvet of UBS Group AG inquired about Q1 volume development in the Drug Containment Solutions (DCS) segment, the expected duration of foreign exchange impacts, regional growth trends for vials, and the timeline for the U.S. expansion for GLP-1 production.

Answer

CFO Dr. Almuth Steinkuhler clarified that Q1 DCS growth was driven by a small price impact with the remainder from volume, and that the significant FX impact from the Argentinian peso is now largely digested and not expected to repeat. CEO Andreas Reisse added that vial order intake is recovering strongly in EMEA and North America. He also stated the U.S. expansion decision is not urgent due to existing capacity and confirmed some benefit from GLP-1 compounding via sterile vial sales.

Olivier Calvet of UBS inquired about the potential impact of the U.S. administration on the injectable market, the acceleration in vial destocking order intake, the FY25 growth outlook for the DCS versus DDS segments, the quantification of FY25 ramp-up costs, and the financial support from take-or-pay contracts. He also followed up on the timing of new multi-million dollar contracts, the absolute EBITDA decline in the DDS segment, FX losses, and maintenance CapEx.

Answer

CEO Andreas Reisse stated that the impact from a new U.S. administration is not expected to be significant in FY25 and noted positive vial order intake for several months, particularly in India and a recovering U.S. CFO Dr. Almuth Steinkuhler clarified that for FY25, DCS growth will be stronger than DDS due to sterile cartridges and vial recovery, while DDS growth will be back-end loaded from new capacity in Hungary, offset by lower polymer syringe demand. She confirmed ramp-up costs would be at a similar level to FY24. Reisse added that new multi-million dollar contracts, largely for GLP-1, were signed in Q4 with long-term timelines. Steinkuhler also confirmed the slight absolute EBITDA decline for the DDS segment.

Asked about the potential impact of the U.S. administration on the injectable market, details on vial destocking and order intake, clarification on the FY25 guidance for DCS vs. DDS segments, quantification of 2025 ramp-up costs, the financial impact of take-or-pay contracts, timing of new multi-million dollar contracts, FX impacts, maintenance CapEx, and the main shareholder's intentions.

Answer

The company does not expect a big impact from the U.S. administration in 2025. Vial order intake is recovering, led by India. For FY25, DCS growth will be stronger than DDS, which is impacted by a negative product mix (less polymer syringes). Ramp-up costs will be similar to 2024. New large, long-term contracts, mainly for GLP-1, were signed in Q4. A slight absolute EBITDA decline is expected for the DDS segment. Maintenance CapEx remains 2-3% of revenue, and they are unaware of any changes regarding the main shareholder.