Laboratorios Farmaceuticos Rovi (ROVI) Q3 2024 earnings summary

Executive summary

• Operating revenue for the first nine months of 2024 was €564.6 million, down 5% year-over-year, mainly due to lower CDMO revenues from COVID-19 vaccine manufacturing and plant preparation activities for Moderna.

• Okedi® sales surged 126% to €20.3 million, while Neparvis® sales rose 13% to €38.1 million; bemiparin sales increased 6% and international sales represented 63% of revenue.

• Net profit declined by 4% to €113.5 million in the first nine months of 2024.

• Gross margin improved by 4.7 percentage points to 63.6%, driven by higher-margin products and reduced low-margin CDMO activities.

• Strategic review of the CDMO business concluded with a decision to continue under the current group structure; share capital reduction executed, increasing shareholder percentage interest.

Financial highlights

• Gross profit increased 2% to €359.0 million; gross margin: 63.6% (+4.7 pp year-over-year).

• EBITDA was €167.2 million, down 2% year-over-year; EBITDA margin rose 0.8 points to 29.6%.

• EBIT was €146.6 million, down 4% year-over-year; EBIT margin: 26.0% (+0.2 pp).

• CapEx totaled €33.8 million, mainly for facility expansion, ISM industrialization, and new filling lines.

• Net debt rose to €108.8 million as of September 30, 2024 (up from €38.6 million at 2023 year-end).

Outlook and guidance

• Operating revenue expected to decrease by a mid-single-digit percentage in both 2024 and 2025 compared to prior years.

• Guidance reflects lower CDMO adaptation revenues and conservative assumptions for new client contributions.

• SG&A expected to grow at a low single-digit rate in 2025, with continued investment in R&D and Okedi launches.

• Okedi® global sales potential estimated at €100–200 million in coming years.

• Q4 2024 and Q3 2024 anticipated to be the strongest quarters for enoxaparin and CDMO sales, respectively.