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Merck KGaA FY20 Profit Up, Lifts Dividend; Sees Organic Growth In FY21

merckkgaa nov14 04mar21 lt

German drug major Merck KgaA reported Thursday significantly higher profit in its fiscal 2020 with strong sales growth in Life Science and Electronics business sectors. The company also announced a higher dividend.

Looking ahead for fiscal 2021, Merck expects to deliver strong organic net sales growth, driven mainly by the Healthcare and Life Science business sectors.

Merck forecasts organic growth of EBITDA pre in a high single-digit to low teens percentage range - excluding the release of the provision in 2020. Including the income from the release of the provision in autumn 2020, the company expects to see slight to moderate organic growth of EBITDA pre.

The Executive Board and the Supervisory Board will propose a dividend of 1.40 euros per share, an increase of 0.10 euro over the previous year.

For fiscal 2020, profit after tax climbed 50.6 percent to 1.99 billion euros from last year's 1.32 billion euros. Earnings per share were 4.57 euros, up from 3.04 euros a year ago.

Earnings per share pre were 6.70 euros, compared to prior year's 5.56 euros.

The operating result EBIT grew 40.8 percent over the previous year to 3.0 billion euros. EBITDA pre, the most important financial indicator to steer operating business, jumped 18.6 percent to 5.2 billion euros, and EBITDA pre margin grew to 29.7 percent from 27.1 percent last year.

Net sales increased 8.6 percent to 17.53 billion euros from 16.15 billion euros a year ago. Organically, sales increased 6 percent.

Healthcare business sector sales declined 1.1 percent, while Life Science business sales grew 9.5 percent and sales of the Electronics business sector, which previously operated under the name
Performance Materials, rose 31.3 percent.

In the fourth quarter, earnings per share pre were 1.57 euros. EBITDA pre rose 3.3 percent to 1.2 billion euros. Group sales increased 5 percent on a reported basis and 11 percent organically with sales growth in all three business sectors.

In Germany, Merck KgaA shares were trading at 133.20 euros, up 0.26 percent.

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