MANNEDORF, SWITZERLAND--(Marketwire - Aug 16, 2012) -
Tecan Group AG /
Moderate increase in sales and solid profitability for Tecan in the first
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* Sales of CHF 182.2 million (H1 2011: CHF 181.9 million);
moderate increase of 0.2% in Swiss francs and 0.3% in local currencies
* Business segment sales performance in local currencies:
Life Sciences Business -1.1%, Partnering Business +2.1%
* Order entry of CHF 179.6 million (H1 2011: CHF 196.0 million);
down by 8.4%, mainly due to advance orders received in December 2011
* Operating profit (EBIT) increased by 6.3% to CHF 22.1 million (H1 2011:
CHF 20.8 million); operating profit margin at 12.2% (H1 2011: 11.5%)
* Net profit of CHF 17.5 million (H1 2011: CHF 23.3 million);
net profit margin of 9.6% (H1 2011: 12.8%)
* Earnings per share of CHF 1.62 (H1 2011: CHF 2.17)
* Cash flow from operating activities of CHF -8.0 million due to
of an OEM development project
* Forecast of low- to mid-single-digit sales growth in local currency
and profitability target confirmed for full-year 2012
* Significant progress in major development programs
The Tecan Group (SIX: TECN) closed the first half of 2012 with a moderate increase in sales and a
solid operating result. Sales increased by 0.2% to CHF 182.2 million in the
first six months (H1 2011: CHF 181.9 million) and were up by 0.3% in local
currency terms. Order entry decreased by 8.4% to CHF 179.6 million in the
half of 2012, mainly due to advance orders from Partnering Business
already received in December 2011 instead of the first quarter of 2012 (H1
2011: CHF 196.0 million).
In the first six months of 2012, the operating profit margin increased to
(H1 2011: 11.5%) and the operating profit (EBIT) of CHF 22.1 million was
above the prior-year period (H1 2011: CHF 20.8 million). Net profit
CHF 17.5 million (H1 2011: CHF 23.3 million). Net profit in the first half
2011 benefited from a significantly better financial result, which was
attributable to gains from currency hedging, and was to a large extent
out again over the full year 2011. The net profit margin in the first half
2012 reached 9.6% of sales (H1 2011: 12.8%). Earnings per share were CHF
(H1 2011: CHF 2.17).
Due to the pre-financing of an OEM development project amounting to
CHF 23.0 million, Tecan posted a negative cash flow from operating
CHF -8.0 million (H1 2011: CHF 18.0 million) in the first six months.
Gerard Vaillant, acting CEO of Tecan, commented: "We are pleased with the
results in the first half of the year and the fact that we were able to
moderately grow sales above the high level we reached last year, despite
challenging economic environment. Based on our order backlog, the project
pipeline and contributions from the launch of an exciting alternative
technology in the third quarter, we anticipate an acceleration in growth in
second half of the year and therefore confirm our guidance for the full
"We have achieved significant progress in the three major development
currently underway, although important milestones still lie ahead of us.
Successfully completing these programs is of the highest priority for
at Tecan," Vaillant continued.
In Europe, sales in Swiss francs were 13.4% below the prior-year period and
decreased by 11.6% in local currencies. This decrease is primarily due to
sales to Partnering Business customers in Europe and lower Life Sciences
Business sales in Switzerland compared to the high baseline of the
period. Life Sciences Business sales in other European countries were only
slightly below the prior-year period.
In North America, Tecan achieved sales growth of 11.5% in Swiss francs and
in local currencies. The growth in this region was predominantly achieved
to the strong performance of the Partnering Business. Life Sciences
sales to end-customers were moderately below the prior-year level in North
Sales in Asia were strong, growing by 33.0% in Swiss francs and by 29.9% in
local currencies. Investments in the market organizations in China and
are starting to pay off, with Life Sciences Business sales in those two
countries driving significant growth for the region.
Recurring sales of services and consumables
Recurring sales of services and consumables increased by 1.4% in local
terms and accounted for 32.5% of total sales (H1 2011: 32.2%). As part of
figure, sales of consumables in local currencies grew by 18.4% compared
prior-year period, to a share of 9.6% of total sales (H1 2011: 8.2%).
Research and development
In the first half of 2012, research and development spending was at 12.4%
sales (H1 2011: 12.8%), or CHF 22.5 million (H1 2011: CHF 23.2 million).
told, research and development activities amounted to CHF 55.3 million
2011: CHF 42.4 million). This figure also includes the development costs
capitalized in the balance sheet (CHF 1.9 million gross) and development
for OEM partners (CHF 32.0 million). As previously announced, Tecan expects
research and development spending of around 13.5% of sales in 2012.
Tecan has three major development programs currently underway. For the two
OEM programs under development, P14 and P16, Tecan continues to expect the
of commercial supply of instruments to its partners in 2013. As
before, the launch of the next generation of liquid handling platforms is
anticipated no later than 2014.
Tecan continues to enhance and broaden the functionalities of the market
Freedom EVO® liquid handling platform with new modules and
the upcoming launch of the Air Liquid Handling Arm(™) Tecan is
alternative pipetting technology to better address its customers' specific
preferences and expand its target market. By uniquely offering a choice of
pipetting technologies on the same platform, or even combining both
on a single workstation, Tecan provides unrivalled flexibility to suit the
of every application and laboratory workflow.
Information by business segment
Life Sciences Business (end-customer business)
Sales in the Life Sciences Business segment decreased by 1.4% to
CHF 100.8 million in the first half of 2012 (H1 2011: CHF 102.3 million).
local currencies, sales were 1.1% below the prior-year period. The Life
Business constituted 55.3% of total Group sales in the first half of the
(H1 2011: 56.3%). Sales of detection instruments increased in the first six
months of the year. Sales of liquid handling platforms overall were
below the prior-year level with good growth in Asia Pacific. Order entry
Life Sciences Business segment was slightly below the prior-year period.
The Life Sciences Business is, to a certain degree, subject to seasonality
therefore generates the majority of the segment operating profit in the
half of the year. The Life Sciences Business segment achieved an operating
profit of CHF 4.6 million in the first half of 2012 (H1 2011: CHF 2.4
The operating profit margin doubled to 4.2% of sales in the first six
2012 (H1 2011: 2.1%) and was achieved with an elevated research and
spending level of 17.5% of sales.
Partnering Business (OEM business)
The Partnering Business segment generated sales of CHF 81.4 million during
reporting period (H1 2011: CHF 79.5 million). Sales increased by 2.3% in
francs and by 2.1% in local currencies. The Partnering Business accounted
44.7% of total Group sales (H1 2011: 43.7%). In the first half of 2012,
OEM instruments were slightly above the prior-year period, while components
well as services and consumables saw good growth.
Due to advance orders from Partnering Business customers already received
December 2011 instead of the first quarter of 2012, order entry in the
half-year was below the prior-year period.
The Partnering Business segment achieved an operating profit margin of
sales in the first six months of 2012 (H1 2011: 28.6%). At CHF 21.3 million,
operating profit was below the prior-year period (H1 2011: CHF 23.4
Strong balance sheet - high equity ratio
Tecan's equity ratio increased slightly during the reporting period and
70.6% at June 30, 2012 (December 31, 2011: 69.1%). Net liquidity (cash and
equivalents minus bank liabilities and loans) amounted to CHF 136.7 million
includes cash outflows for increased investments in development programs
dividend payments in the first half of the year (December 31, 2011: CHF
million; June 30, 2011: CHF 137.4 million). The Company's share capital
CHF 1,144,458 at the reporting date (June 30, 2012), consisting of
registered shares with a nominal value of CHF 0.10 each.
At the Tecan Group Annual General Meeting on April 18, 2012, shareholders
approved a 25% increase in the dividend from CHF 1.00 to CHF 1.25 per share.
dividends of CHF 13.5 million in total were once again paid out from the
available capital contribution reserve and are therefore not subject to
withholding tax. The payout took place on April 25, 2012.
The Life Sciences Business segment achieved double-digit sales growth in
currencies in 2011, setting a high baseline for 2012. Based on order
the project pipeline and contributions from the launch of an alternative
pipetting technology in the third quarter of 2012, Tecan is predicting
growth in local currencies for the Life Sciences Business segment in 2012.
Based on confirmed forecasts of its existing customers, Tecan continues to
expect good sales growth in local currencies for the Partnering Business
in fiscal year 2012.
For the Tecan Group, the Company is anticipating an acceleration in growth
the second half of the year and maintains its guidance of low- to
mid-single-digit sales growth in local currency terms for the full year
Tecan continues to forecast an operating profit margin of 12.2% to 13.2% of
sales for full-year 2012. As communicated in March 2012, this expectation
based on an average exchange rate forecast for the full year 2012 of one
equaling CHF 1.20 and one US dollar equaling CHF 0.90. Current exchange
are more favorable for the Company than these assumptions. Should actual
exchange rates be higher, the reported operating profit margin for 2012
Interim Report and webcast
The full 2012 Interim Report can be accessed on the company website
www.tecan.com under Investor Relations. An iPad app for Financial Reports
Tecan Group is also available from the App Store.
A conference call discussing the results for the first half of 2012 will
place today at 10 a.m. (CET). The presentation will also be relayed by live
audio webcast, which interested parties can access at www.tecan.com. A link
the webcast will be provided immediately prior to the event.
The dial-in numbers for the conference call are as follows:
For participants from Europe: +41 91 610 5600 or +44 203 059 5862 (UK)
Participants from the US: +1 (1) 866 291 4166
Participants should if possible dial in 15 minutes before the start of the
Key upcoming dates
* The financial results 2012 will be published on March 7, 2013.
* The Annual General Meeting of Tecan's shareholders will take place in
on April 17, 2013.
Tecan (www.tecan.com) is a leading global provider of laboratory
solutions in biopharmaceuticals, forensics and clinical diagnostics. The
specializes in the development, production and distribution of automated
workflow solutions for laboratories in the life sciences sector. Its
include pharmaceutical and biotechnology companies, university research
departments, and forensic and diagnostic laboratories. As an original
manufacturer (OEM), Tecan is also a leader in developing and manufacturing
instruments and components that are then distributed by partner companies.
Founded in Switzerland in 1980, the company has manufacturing, research and
development sites in both Europe and North America and maintains a sales
service network in 52 countries. In 2011, Tecan generated sales of
CHF 377 million (USD 424 million; EUR 306 million). Registered shares of
Group are traded on the SIX Swiss Exchange (TK: TECN/Reuters: TECZn.S/
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