Galenica (GALE) H1 2024 earnings summary

Executive summary

• Achieved solid sales growth of 2.6% in H1 2024, outperforming the pharmaceutical market and gaining market share despite challenging conditions, with ongoing transformation and digitalization initiatives.

• Expanded pharmacy network, launched new health services including "Consultation plus" and telemedicine, and enhanced customer focus through management team expansion.

• Confirmed 2024 guidance, expecting stronger growth in H2 and maintaining strategic focus on omni-channel and home care expansion.

• Leadership transition announced, with CFO Felix Burkhard to be succeeded by Julien Fiessinger at year-end.

Financial highlights

• Net sales rose 2.6% year-over-year to CHF 1,900 million in H1 2024, with group sales ahead of the pharmaceutical market (+1.7%) and consumer healthcare market (-0.2%).

• Adjusted EBIT at CHF 99 million, down 0.9% year-over-year, impacted by one-off items; net profit reached CHF 79.3 million (+6.4%).

• Products and care segment EBIT rose 3.9% to CHF 75.9 million; logistics and IT segment EBIT CHF 25.4 million.

• Gross margin improved to 27.9% of net sales, driven by strong products and brands growth and higher low-price medicine share.

• Cash flow from operations before working capital changes increased to CHF 97.8 million; free cash flow after acquisitions improved to -CHF 45.3 million.

Outlook and guidance

• Full-year 2024 guidance confirmed: net sales growth of 3–5%, adjusted EBIT growth of 8–11%, and dividend at least at prior year’s level.

• Expects significantly stronger growth in H2 2024 due to favorable sales day constellation and seasonal factors.

• Midterm guidance remains valid despite ERP project extension to 2026.