BioMérieux Net Income Rises 23% in First Half 2020

The Tip Desk · June 30, 2020 · 2 min read

The diagnostic company saw a significant increase in free cash flow and operating results driven by molecular biology demand.

The diagnostic maker reported a net income attributable to the Group of 173 million euros for the first half of 2020, a 23% increase compared to 141 million euros in the same period of 2019. The company said the pandemic had a positive estimated impact of approximately 50 million euros on the current contributory operating result.

Operating performance was supported by a strong trajectory in syndromic testing and molecular biology. This growth helped offset lower sales in other ranges caused by reduced hospital attendance in several countries. The company estimated the favorable incidence of the pandemic on first-half revenue to be approximately 110 million euros.

Regional results were mixed. In Europe, Middle East, and Africa, sales reached 473 million euros for the semester, up 4% from the previous year. However, second-quarter revenue in that region fell 1.7% year-on-year to 225 million euros. In Asia Pacific, second-quarter sales reached 118 million euros, a decline of approximately 6% compared to the same period in 2019. The company attributed the slowdown in China to lower exposure to molecular biology ranges.

Financial efficiency improved as current contributory operating margin reached 17.1% of revenue. Commercial expenses and general overheads were 382 million euros, or 25.9% of revenue, compared to 27.8% in the first half of 2019. The company said this improvement resulted from a slowdown in commercial spending, including travel and congresses, due to lockdown measures. R&D expenses rose to 203 million euros, or 13.8% of revenue, from 179 million euros, or 14% of revenue, in the first half of 2019.

Cash generation accelerated significantly. Free cash flow reached 144.5 million euros in the first half of 2020, compared to 55.1 million euros in the first half of 2019. EBITDA reached 344.7 million euros, or 23.4% of revenue, up 21.9% from 283 million euros in the prior year period.

Debt levels decreased to 191.9 million euros as of June 30, 2020, down from 422 million euros on June 30, 2019. In June 2020, the company issued a 200 million euro private placement consisting of 145 million euros due in 7 years and 55 million euros due in 10 years.

Following the reporting period, the company announced the launch of the BIOFIRE MYCOPLASMA test for detecting mycoplasmas in biopharmaceutical products. The company said it will not communicate new annual objectives at this time due to uncertainties regarding the health crisis, though it expects the favorable impact on financial results to continue into the second half.