Eurofins’ 2016 Budget process highlights Q4 2015 growth close to 50% and strong outlook for 2016
Tuesday, November 24, 2015
Over the past 3 weeks, Eurofins' leadership conducted its 2016 Budget exercise. Meetings with management of the main Eurofins companies around the world were very encouraging. After a good month of October, with growth trends in line with Q3 2015, and positive outlook by management of most group companies, it appears that reported revenue growth for Q4 2015 could be close to 50% compared to Q4 2014. This would mean that the revenue objective of EUR 1.9bn for 2015, raised for the second time as recently as October 26th may be exceeded. Should current trends continue, Group revenues could come in close to EUR 1.94 bn in 2015. This would represent 7% more revenues in Q4 2015 than the EUR 553m corresponding to the EUR 1.9bn objective set recently.
Outlook for 2016 appears positive across businesses and geographies so that the annual organic growth objective of 5% set for the next 5 years as communicated in the press release of October 19th could well prove to be conservative, at least in 2016.
The Group has, or will complete the vast majority of its laboratory infrastructure investments by the end of 2016 so that it will be equipped with very effective platforms to compete in its markets and provide clients with an unequalled level of service. This, combined with the 35 startup laboratories coming on stream by the of end 2016, and a number of new exclusive tests out of its R&D, as well as significant strengthening of Eurofins' top leadership team with strong experienced leaders, bode well for continued strong organic growth beyond 2016.
Eurofins' M&A pipeline also appears to be very large at the moment so that at least for 2016, the objective to add EUR 200m revenues per year through acquisitions could be easily achievable with targets of high quality and mostly strong profitability. It could even be exceeded as several large bolt-on assets within Eurofins' areas of focus are, or are likely to become available in the next few quarters, which could contribute to strengthening Eurofins' leading global positions in its markets, as well as provide future growth opportunities and returns well above its cost of capital. Of course, Eurofins intends to continue to follow a very disciplined approach to acquisitions, and to only carry out such if the Group's management is convinced that they will provide very good returns on the invested capital, and not stretch its balance sheet to inappropriate levels.
For more information, please visit www.eurofins.com or contact:
Eurofins Investor Relations
Phone: +32 2 766 1620
Notes for the editor:
Eurofins - a global leader in bio-analysis
Eurofins Scientific is the world leader in food, environment and pharmaceutical products testing. It is also one of the global market leaders in agroscience, genomics, discovery pharmacology and central laboratory services. In addition, Eurofins is one of the key emerging players in specialty clinical diagnostic testing in Europe and the USA.
With 20,000 staff in around 200 laboratories across 38 countries, Eurofins offers a portfolio of over 130,000 reliable analytical methods for evaluating the safety, identity, composition, authenticity, origin and purity of biological substances and products, as well as for innovative clinical diagnostic. The Group provides its customers with high-quality services, accurate results on time and expert advice by its highly qualified staff.
Eurofins is committed to pursuing its dynamic growth strategy by expanding both its technology portfolio and its geographic reach. Through R&D and acquisitions, the Group draws on the latest developments in the field of biotechnology and analytical chemistry to offer its clients unique analytical solutions and the most comprehensive range of testing methods.
As one of the most innovative and quality oriented international players in its industry, Eurofins is ideally positioned to support its clients' increasingly stringent quality and safety standards and the expanding demands of regulatory authorities around the world.
The shares of Eurofins Scientific are listed on the Euronext Paris Stock Exchange (ISIN FR0000038259, Reuters EUFI.PA, Bloomberg ERF FP).
This press release contains forward-looking statements and estimates that involve risks and uncertainties. The forward-looking statements and estimates contained herein represent the judgement of Eurofins Scientific’ management as of the date of this release. These forward-looking statements are not guarantees for future performance, and the forward-looking events discussed in this release may not occur. Eurofins Scientific disclaims any intent or obligation to update any of these forward-looking statements and estimates. All statements and estimates are made based on the information available to the Company’s management as of the date of publication, but no guarantee can be made as to their validity.