Sartorius AG shares surge 11% after Q3 beat, full-year guidance raised

Investing.com -- Shares of Sartorius AG rose more than 11% on Thursday following the company’s third-quarter results, which came in above expectations and led management to raise full-year guidance. 

The company’s unit, Sartorius Stedim Biotech, also posted stronger-than-expected growth, supporting the group’s outlook.

Sartorius Stedim reported 12% growth at constant exchange rates (CER), 1.8 percentage points above consensus and in line with RBC Capital Markets estimates. 

Recurring revenue contributed to growth across all regions, and the company described its equipment business as stabilizing. 

EBITDA margin reached 31.3%, 0.9 percentage points above consensus and 1.3 points above RBC estimates, attributed to volume, product mix, and scale effects. 

Management raised full-year guidance to the top of its prior range, now expecting 9% CER revenue growth and a 31% EBITDA margin. 

Prior guidance had forecast 7% ±2% revenue growth at CER and an EBITDA margin of 30-31%.

Sartorius AG reported sales growth of 10.6% at CER, 2 percentage points above consensus and 0.8 points on a reported basis. Growth was broad-based across all regions. 

The Bioprocess Solutions (BPS) division grew 12.1% at CER compared with a 10.5% consensus, while Lab Products and Services (LPS) grew 4.4% versus a 1.5% consensus. 

The group’s EBITDA margin increased to 29.3%, up 2.2 points year-on-year and in line with consensus and RBC estimates. 

BPS delivered a margin of 31.3%, slightly above the 31.0% consensus, while LPS recorded 20.6%, below the 21.6% consensus.

Management raised Sartorius AG’s full-year guidance to the mid-to-upper part of the prior range. CER revenue growth is now expected at 7%, with BPS at 9% and LPS at 0% organically, including 1% from acquisitions. 

The group margin is projected slightly above 29.5%, with BPS above 31.5% and LPS around 21.5%.

Prior guidance had projected 6% ±2% revenue growth at CER and an EBITDA margin of 29-30%, with BPS at 7% ±2% growth at 31–32% margin and LPS at 1% ±2% growth at 22–23% margin.

RBC Capital Markets maintained its “outperform” rating on both Sartorius Stedim and Sartorius AG, noting slightly more implied upside for Sartorius Stedim at €230 (+26%) versus Sartorius AG at €250 (+19%).