West Announces First-Quarter 2024 Results and Declares Third-Quarter 2024 Dividend
- Conference Call Scheduled for
First-Quarter 2024 Summary (comparisons to prior-year period)
- Net sales of
$695.4 million declined 3.0%; organic net sales also declined by 3.0%. - Reported-diluted EPS of
$1.55 declined by 16.2%. - Adjusted-diluted EPS of
$1.56 declined by 21.2%. - The Company is reaffirming full-year 2024 net sales guidance in a range of
$3.000 billion to$3.025 billion . - The Company is raising full-year 2024 adjusted-diluted EPS guidance to a new range of
$7.63 to$7.88 , compared to a prior range of$7.50 to$7.75 . - The Company also announced that its Board of Directors has approved a third-quarter 2024 dividend of
$0.20 per share. The dividend will be paid onAugust 7, 2024 , to shareholders of record as ofJuly 31, 2024 .
"Adjusted-diluted EPS" and "organic sales growth" are Non-
"We had a solid start to the year and our full-year 2024 financial outlook remains unchanged," said
Proprietary Products Segment
Net sales declined by 4.0% to
The Biologics market unit had low-single digit organic sales growth. The Pharma market unit had a high-single digit organic decline in sales, and the Generics market unit declined double digits. Proprietary Products segment growth was led by NovaPure®, self-injection device platforms and Daikyo Crystal Zenith® components, which were more than offset by declines in FluroTec®, Westar® and standard components.
Contract-Manufactured Products Segment
Net sales increased by 1.8% to
Financial Highlights
Operating cash flow was
During the quarter, the Company repurchased 729,679 shares for
Full-Year 2024 Financial Guidance
- The Company is reaffirming full-year 2024 financial guidance of net sales in a range of
$3.000 billion to$3.025 billion .- Organic net sales growth is expected to be approximately 2% to 3%.
- Net sales guidance includes an estimated full-year 2024 headwind of approximately
$8.0 million based on current foreign currency exchange rates.
- The Company is raising full-year 2024 financial guidance of adjusted-diluted EPS to a new range of
$7.63 to$7.88 , compared to a prior range of$7.50 to$7.75 .- Full-year adjusted-diluted EPS guidance range includes an estimated headwind of approximately
$0.04 based on current foreign currency exchange rates, which is an increase from prior guidance of$0.02 . - The updated guidance also includes EPS of
$0.15 associated with first-quarter 2024 tax benefits from stock-based compensation. - For the remaining quarters of the year, our EPS guidance range assumes a tax rate of 22.5% and does not include potential tax benefits from stock-based compensation. Any tax benefits associated with stock-based compensation beyond those recorded in the first-quarter 2024 would provide a positive adjustment to our full-year adjusted-diluted EPS guidance.
- Full-year adjusted-diluted EPS guidance range includes an estimated headwind of approximately
- Full-year 2024 capital spending guidance is unchanged and is expected to be
$350 million .
First-Quarter 2024 Conference Call
The Company will host a conference call to discuss the results and business expectations at
To participate and ask questions during the conference call, you must register in advance at https://register.vevent.com/register/BIe5bc0234730940b7b2482d1727cc668b. Upon registration, all telephone participants will receive the dial-in number along with a unique PIN number that will be used to access the call.
Management will refer to a slide presentation during the call, which will be made available on the day of the call. To view the presentation, select "Presentations" in the "Investors" section of the Company's website.
A replay of the conference call and webcast will be available on the Company's website for 30 days.
Forward-Looking Statements
This release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may include such words as "outlook," "trends," "are," "future," "expected," "estimate," "estimated," "assumes," "potential," "would provide," "will," and other similar terminology. These statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this release. There is no certainty that actual results will be achieved in-line with current expectations. These forward-looking statements involve a number of risks and uncertainties. The following are some of the factors that could cause our actual results to differ materially from those expressed in or underlying our forward-looking statements: prevailing economic conditions and general uncertainties relating thereto that may be unknown and unforeseeable; customers' changing inventory requirements and manufacturing plans and customer decisions to move forward with our new products and product categories; interruptions or weaknesses in our supply chain, illness in our workforce and access to transport for our products; disruptions or limitations in the Company's manufacturing capacity; average profitability, or mix, of the products we sell; dependence on third-party suppliers and partners; increased raw material, energy and labor costs; fluctuations in currency exchange; the ability to meet development milestones with key customers; and the consequences of other geopolitical events, including natural disasters, acts of war, and global health crises. This list of important factors is not all inclusive. For a description of certain additional factors that could cause the Company's future results to differ from those expressed in any such forward-looking statements, see Part I Item 1A, entitled "Risk Factors," in the Company's Annual Report on Form 10-K for the year ended
Except as required by law or regulation, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, therefore you should not rely on these forward-looking statements as representing our views as of any date other than today.
Non-
This release contains certain non-GAAP financial measures, including organic net sales and adjusted-diluted EPS. For the purpose of aiding the comparison of our year-over-year results, we may refer to net sales and other financial results excluding the effects of changes in foreign currency exchange rates. Organic net sales exclude the impact from acquisitions and/or divestitures and translate the current-period reported sales of subsidiaries whose functional currency is other than the
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (in millions, except per share data) |
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Three Months Ended
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2024 |
2023 |
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Net sales |
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100 % |
716.6 |
100 % |
Cost of goods and services sold |
465.2 |
67 |
445.3 |
62 |
Gross profit |
230.2 |
33 |
271.3 |
38 |
Research and development |
17.6 |
2 |
17.1 |
2 |
Selling, general and administrative expenses |
86.7 |
13 |
86.0 |
12 |
Other expense (income) |
3.1 |
- |
12.9 |
2 |
Operating profit |
122.8 |
18 |
155.3 |
22 |
Interest (income) expense, net |
(4.6) |
- |
(2.6) |
- |
Income before income taxes and equity in net income of affiliated companies |
127.4 |
18 |
157.9 |
22 |
Income tax expense |
16.4 |
2 |
23.6 |
3 |
Equity in net income of affiliated companies |
(4.3) |
(1) |
(5.7) |
(1) |
Net income |
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17 % |
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20 % |
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Net income per share: |
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Basic |
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Diluted |
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Average common shares outstanding |
73.5 |
|
74.5 |
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Average shares assuming dilution |
74.3 |
|
75.7 |
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REPORTING SEGMENT INFORMATION (UNAUDITED) (in millions) |
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Three Months Ended |
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2024 |
2023 |
Proprietary Products |
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Contract-Manufactured Products |
135.9 |
133.5 |
Eliminations |
- |
- |
Consolidated Total |
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Gross Profit: |
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Proprietary Products |
|
|
Contract-Manufactured Products |
23.1 |
23.5 |
Gross Profit |
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Gross Profit Margin |
33.1 % |
37.9 % |
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Operating Profit (Loss): |
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Proprietary Products |
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|
Contract-Manufactured Products |
17.1 |
17.4 |
Stock-based compensation expense |
(5.0) |
(8.5) |
General corporate costs |
(15.6) |
(24.3) |
Reported Operating Profit |
|
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Reported Operating Profit Margin |
17.7 % |
21.7 % |
Unallocated items |
0.2 |
9.6 |
Adjusted Operating Profit |
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Adjusted Operating Profit Margin |
17.7 % |
23.0 % |
RECONCILIATION OF NON-GAAP MEASURES (UNAUDITED)
Please refer to "Non- (in millions, except per share data)
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Reconciliation of Reported and Adjusted Operating Profit, Net Income and Diluted EPS |
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Three months ended |
Operating |
Income tax |
Net |
Diluted |
Reported ( |
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Unallocated items: |
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Amortization of acquisition-related intangible assets (1) |
0.2 |
- |
0.7 |
0.01 |
Adjusted (Non- |
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Three months ended |
Operating |
Income tax |
Net |
Diluted |
Reported ( |
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Unallocated items: |
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Amortization of acquisition-related intangible assets (1) |
0.2 |
- |
0.7 |
0.01 |
Loss on disposal of plant (2) |
9.4 |
- |
9.4 |
0.12 |
Adjusted (Non- |
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(1) |
During the three months ended |
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(2) |
During the three months ended |
RECONCILIATION OF NON-GAAP MEASURES (UNAUDITED)
Please refer to "Non- (in millions, except per share data)
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Reconciliation of |
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Three months ended |
Proprietary |
CM |
Eliminations |
Total |
Reported net sales ( |
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|
$ - |
|
Effect of changes in currency translation rates |
(2.8) |
(0.6) |
- |
(3.4) |
Organic net sales (Non- |
|
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$ - |
|
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Three months ended |
Proprietary |
CM |
Eliminations |
Total |
Reported net sales ( |
|
|
$ - |
|
Effect of divestitures and/or acquisitions |
(3.2) |
- |
- |
(3.2) |
Net sales excluding divestiture (Non- |
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$ - |
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(3) |
Organic net sales exclude the impact from acquisitions and/or divestitures and translate the current-period reported sales of subsidiaries whose functional currency is other than the |
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(4) |
Net sales excluding divestitures represents the 2023 comparative sales figure used in our organic sales growth calculation to eliminate the impact of our 2023 divestiture. |
RECONCILIATION OF NON-GAAP MEASURES (UNAUDITED)
Please refer to "Non- (in millions, except per share data) |
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Reconciliation of Reported-Diluted EPS Guidance to Adjusted-Diluted EPS Guidance |
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2023 Actual |
2024 Guidance |
% Change |
Reported-diluted EPS ( |
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(3.7%) to (0.5%) |
Loss of disposal on plant |
0.16 |
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Cost investment activity |
0.06 |
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Restructuring and other charges |
(0.02) |
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Amortization of acquisition-related intangible assets |
0.04 |
0.04 |
|
Legal settlement |
(0.04) |
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Adjusted-diluted EPS (Non- |
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(5.6%) to (2.5%) |
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Notes: |
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See "Full-year 2024 Financial Guidance" and "Non- |
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(5) |
We have opted not to forecast 2024 tax benefits from stock-based compensation in upcoming quarters, as they are out of the Company's control. Instead, we recognize the benefits as they occur. In the first-quarter 2024, tax benefits associated with stock-based compensation increased adjusted-diluted EPS by |
CASH FLOW ITEMS (UNAUDITED) (in millions) |
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Three Months Ended |
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2024 |
2023 |
Depreciation and amortization |
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Operating cash flow |
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Capital expenditures |
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Free cash flow |
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FINANCIAL CONDITION (UNAUDITED) (in millions) |
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As of
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As of
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Cash and cash equivalents |
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Accounts receivable, net |
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Inventories |
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Accounts payable |
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Debt |
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Equity |
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Working capital |
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Trademark Notices
Trademarks and registered trademarks are the property of
Daikyo Crystal Zenith
®
and Daikyo CZ
®
are registered trademarks of
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