Biotest shares rise after FDA approval, sales rise 6% in 2024

Investing.com -- Biotest AG (ETR:BIOG_p) reported a 6% rise in sales for 2024, reaching €726.2 million, driven by strong demand for its immunoglobulin products, particularly Yimmugo, which received U.S. FDA approval in June, sending its shares up by over 2% on Monday. 

The approval also certified Biotest’s production facility, setting the stage for expansion into the U.S. market in 2025. 

EBIT stood at €94.5 million, hitting the upper end of the forecast range but down from €143.5 million in the previous year. 

The decline was due to lower revenue from technology disclosure and development services for Grifols (BME:GRLS), S.A. Adjusted EBIT, which excludes one-time effects, improved from €9.8 million in 2023 to €64.5 million in 2024. 

This was due to the absence of special effects that had impacted the previous year’s results, including the capital gain from the sale of five subsidiaries and a one-time earnings boost from services provided to Grifols.

Earnings before taxes dropped to €46.5 million from €106.3 million the prior year. Net profit followed a similar trend, decreasing from €127 million in 2023 to €26.4 million in 2024. 

Despite the lower earnings, cash flow from operating activities improved, rising to €60.9 million from a negative €2.7 million the previous year. The increase was attributed to better working capital management.

The approval of Yimmugo by the U.S. FDA in June marked a major step for Biotest. The company has since ramped up production to prepare for the U.S. market launch in 2025. 

A long-term agreement with Kedrion Biopharma for the exclusive marketing and distribution of Yimmugo® in the U.S. is expected to generate over $1 billion in revenue over the next seven years.

Biotest also made progress in clinical development, completing its AdFirst Phase III trial for its new fibrinogen product, which is produced in Dreieich. The company has submitted regulatory approval applications in key European markets and the U.S., targeting the treatment of acquired and congenital fibrinogen deficiencies. A decision on these applications is expected by the end of 2025.

Biotest expects a mid-single-digit percentage decline in revenue for 2025. The drop will largely be due to a significant reduction in earnings from technology disclosure and development services for Grifols, which had contributed €123.1 million to revenue in 2024. 

The company anticipates an operating loss, with EBIT forecast to range between -€55 million and -€75 million. 

This projected decline will weigh on return on capital employed, which is expected to fall between -3% and -7%.

Cash flow from operating activities is likely to turn negative, with projections indicating a deficit in the low triple-digit million range.