Merck KGaA 4Q Net Profit Fell, Warns of Coronavirus Hit
05 March 2020 - 5:57PM
Dow Jones News
By Cristina Roca
Merck KGaA said Thursday that its fourth-quarter net profit
fell, and warned that it expects its 2020 sales to be hit by the
coronavirus.
The German pharmaceuticals and chemicals company made a net
profit of 318 million euros ($354.4 million) in the final quarter
of 2019, down from EUR2.45 billion during the same period a year
earlier.
Net sales for the quarter rose 13% to EUR4.38 billion, slightly
higher than analysts' expectations of EUR4.33 billion, according to
a consensus estimate provided by FactSet. Sales growth was driven
by the health-care and life science business sectors, Merck
said.
Sales for the year rose to EUR16.15 billion, growing organically
by 5.3%. Merck had guided for organic revenue growth of 3%-5%.
The closely watched company metric Ebitda pre--or earnings
before interest, taxes, depreciation and amortization before
one-time items--was EUR1.21 billion for the quarter, up from EUR950
million during the same period a year ago.
Merck said it is difficult to determine the effect the
coronavirus epidemic will have on its business, but that it is
currently working with the assumption that the epidemic will peak
during the first quarter of the year and subside over the course of
the second. Based on this, the virus should deal a 1% hit on
Merck's 2020 sales, the company said.
"Yet, should the crisis grow or trigger a global recession, the
company would adapt its business forecast," Merck said.
For 2020, the company guided for strong organic growth in sales
and Ebitda pre. It proposed a dividend of EUR1.30 a share, up from
EUR1.25 a share the year prior.
Write to Cristina Roca at cristina.roca@dowjones.com
(END) Dow Jones Newswires
March 05, 2020 01:42 ET (06:42 GMT)
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