In This Article:
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Organic Sales Growth (Q4 2024): 4% for the group.
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Healthcare Organic Sales Growth (Q4 2024): 7%.
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Life Science Organic Sales Growth (Q4 2024): 2%.
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Electronics Organic Sales Growth (Q4 2024): 2%.
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EBITDA Pre Growth (Q4 2024): 20% organically.
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Proposed Dividend: EUR2.20 per share.
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Full Year 2024 Net Sales: EUR21.16 billion.
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Full Year 2024 EBITDA Pre: EUR6.07 billion.
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Full Year 2024 EPS Pre: EUR8.63 per share.
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Operating Cash Flow (Full Year 2024): EUR4.59 billion.
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Net Debt (End of 2024): EUR7.16 billion.
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Life Science EBITDA Pre Margin (Q4 2024): 29.4%.
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Healthcare EBITDA Pre Margin (Q4 2024): 35.4%.
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Electronics EBITDA Pre Margin (Q4 2024): 25.6%.
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Guidance for 2025 Sales: EUR21.5 billion to EUR22.9 billion.
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Guidance for 2025 EBITDA Pre: EUR6.1 billion to EUR6.6 billion.
Release Date: March 06, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Merck KGaA (MKGAF) delivered on its guidance and returned to profitable growth in 2024, with all three sectors contributing to the strong performance.
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Healthcare sector showed strong organic sales growth of 7%, driven by oncology portfolio and CM&E portfolio.
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Life Science sector returned to organic growth with a 2% increase in Q4, supported by strong order intake in Process Solutions.
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Electronics sector experienced organic sales growth of 2% in Q4, driven by AI-related demand in Semiconductor Solutions.
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The company improved its net leverage despite significant investments in CapEx and M&A during 2024, demonstrating strong cash generation.
Negative Points
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Non-repeat COVID-19-related sales fell to negligible levels, resulting in a 3% organic sales decline in Life Science for 2024.
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The Display Solutions segment in Electronics saw a 3% organic sales decline due to a decrease in general liquid crystals applications.
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FX represented a headwind of minus 0.5% on sales, particularly impacting the Healthcare sector.
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The NIH funding exposure and potential cuts could impact the Life Science segment, particularly the SLS segment.
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The broader semiconductor market has not yet fully recovered, with timing for a general market inflection remaining challenging to predict.
Q & A Highlights
Q: Can you discuss the impact of NIH funding on Life Science and the effect of tariffs on your supply chain? A: Matthias Heinzel, CEO of Life Science, explained that NIH funding impacts about 5% of total Life Science sales. While potential cuts could affect buying behaviors, it's too early to predict the exact impact. Regarding tariffs, Merck has adopted an in-region, for-region strategy, with a strong US footprint and over 20 plants, allowing flexibility in production to mitigate tariff impacts.