Siegfried (SFZN) CMD 2024 summary

Strategy and Future Growth

• EVOLVE+ strategy focuses on expanding technological capabilities, operational excellence, and broadening offerings in both drug substance and drug product segments, including cell & gene therapy and advanced injectables.

• M&A remains a key growth catalyst, with disciplined, value-accretive acquisitions in early-stage manufacturing, new modalities, and geographies.

• Investments target network expansion, advanced production technologies, and new facilities in Barcelona, Evionnaz, Minden, and Schlieren, with the DINAMIQS platform for cell & gene therapy and a new GMP facility operational by late 2025.

• Commercial excellence initiatives adapt go-to-market strategies and segmentation to widen the customer base, especially among small and mid-cap pharma.

• Early-stage development capabilities enhanced by acquisitions, enabling end-to-end service from preclinical to commercialization.

Financial Performance and Guidance

• Net sales grew at an 11.1% CAGR from 2019 to 2023, reaching CHF 1,272m, with core EBITDA up 18.1% CAGR and operating cash flow increasing at a 33.5% CAGR.

• Achieved double-digit top-line growth, strong margin expansion, and resilient shareholder return over the past five years.

• 2024 guidance: low single-digit sales growth in local currencies, core EBITDA margin at or above 2023 levels, and positive midterm outlook for continued profitable growth above market.

• Leverage reduced to 1.3x by H1 2024, providing up to CHF 600m debt capacity for further acquisitions.

• CapEx to normalize to low teens as a percentage of revenue from 2025, with high return on invested capital targeted for new projects.

Market Positioning and Business Model

• Leading global CDMO with 13 sites in 7 countries, serving over 500 customers and offering end-to-end services for drug substances and products.

• Diversified customer base (64% small/mid pharma, 36% large pharma) and product portfolio enhance resilience and growth.

• End-to-end service offering from early development to commercialization, especially attractive to small and mid-cap pharma lacking in-house capabilities.

• Strategic flexibility to enter large-scale biologics if attractive opportunities arise, but disciplined approach to M&A remains.

• CDMO market seen as highly attractive, offering significant growth opportunities.