– Conference Call Scheduled for 9 a.m. EDT Today –

EXTON, Pa., April 25, 2024 /PRNewswire/ — West Pharmaceutical Services, Inc. (NYSE: WST) today announced its financial results for the first-quarter 2024 and updated full-year 2024 financial guidance.

First-Quarter 2024 Summary (comparisons to prior-year period)

• Net sales of $695.4 million declined 3.0%; organic net sales also declined by 3.0%.
• Reported-diluted EPS of $1.55 declined by 16.2%.
• Adjusted-diluted EPS of $1.56 declined by 21.2%.
• The Company is reaffirming full-year 2024 net sales guidance in a range of $3.000 billion to $3.025 billion.  
• The Company is raising full-year 2024 adjusted-diluted EPS guidance to a new range of $7.63 to $7.88, compared to a prior range of $7.50 to $7.75.
• The Company also announced that its Board of Directors has approved a third-quarter 2024 dividend of $0.20 per share. The dividend will be paid on August 7, 2024, to shareholders of record as of July 31, 2024.

“Adjusted-diluted EPS” and “organic sales growth” are Non-U.S. GAAP measurements.  See discussion under the heading “Non-U.S. GAAP Financial Measures” in this release. 

“We had a solid start to the year and our full-year 2024 financial outlook remains unchanged,” said Eric M. Green, President, Chief Executive Officer and Chair of the Board of Directors. “We are actively managing the timing of inventory decisions by some of our customers, and our recent order trends reinforce our prior outlook for stronger organic sales growth in the second half of the year. As we navigate the near-term headwinds, we are controlling our costs while making strategic investments in new manufacturing capacity in both our Contract Manufacturing segment and our Proprietary Products segment, which positions us well for future organic sales growth.”

Proprietary Products Segment

Net sales declined by 4.0% to $559.5 million. Organic sales declined by 4.0% with currency translation positively impacting sales growth by 50 basis points.  High-value products (components and devices) represented 72% of segment sales and an organic sales decline of low-single digits.

The Biologics market unit had low-single digit organic sales growth.  The Pharma market unit had a high-single digit organic decline in sales, and the Generics market unit declined double digits.  Proprietary Products segment growth was led by NovaPure®, self-injection device platforms and Daikyo Crystal Zenith® components, which were more than offset by declines in FluroTec®, Westar® and standard components. 

Contract-Manufactured Products Segment

Net sales increased by 1.8% to $135.9 million.  Organic sales growth was 1.3% with currency translation positively impacting sales growth by 50 basis points.  Segment performance was led by growth in sales of components associated with diagnostic devices.

Financial Highlights

Operating cash flow was $118.2 million, a decrease of 14.4%.  Capital expenditures in the quarter were $90.6 million.  Free cash flow (operating cash flow minus capital expenditures) was $27.6 million, a decrease of 50.7%.

During the quarter, the Company repurchased 729,679 shares for $267.0 million at an average share price of $365.87 under its share repurchase program.

Full-Year 2024 Financial Guidance

• The Company is reaffirming full-year 2024 financial guidance of net sales in a range of $3.000 billion to $3.025 billion.
  • Organic net sales growth is expected to be approximately 2% to 3%.
  • Net sales guidance includes an estimated full-year 2024 headwind of approximately $8.0 million based on current foreign currency exchange rates.
• The Company is raising full-year 2024 financial guidance of adjusted-diluted EPS to a new range of $7.63 to $7.88, compared to a prior range of $7.50 to $7.75.
  • Full-year adjusted-diluted EPS guidance range includes an estimated headwind of approximately $0.04 based on current foreign currency exchange rates, which is an increase from prior guidance of $0.02.
  • The updated guidance also includes EPS of $0.15 associated with first-quarter 2024 tax benefits from stock-based compensation.
  • For the remaining quarters of the year, our EPS guidance range assumes a tax rate of 22.5% and does not include potential tax benefits from stock-based compensation.  Any tax benefits associated with stock-based compensation beyond those recorded in the first-quarter 2024 would provide a positive adjustment to our full-year adjusted-diluted EPS guidance.
• Full-year 2024 capital spending guidance is unchanged and is expected to be $350 million.

First-Quarter 2024 Conference Call

The Company will host a conference call to discuss the results and business expectations at 9:00 a.m. Eastern Time today.  The live audio-only webcast will be made available via the Company’s Investor Relations website at www.westpharma.com

To participate and ask questions during the conference call, you must register in advance at https://register.vevent.com/register/BIe5bc0234730940b7b2482d1727cc668b. Upon registration, all telephone participants will receive the dial-in number along with a unique PIN number that will be used to access the call.

Management will refer to a slide presentation during the call, which will be made available on the day of the call. To view the presentation, select “Presentations” in the “Investors” section of the Company’s website. 

A replay of the conference call and webcast will be available on the Company’s website for 30 days.

Forward-Looking Statements

This release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These statements may include such words as “outlook,” “trends,” “are,” “future,” “expected,” “estimate,” “estimated,” “assumes,” “potential,” “would provide,” “will,” and other similar terminology.  These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this release.  There is no certainty that actual results will be achieved in-line with current expectations.  These forward-looking statements involve a number of risks and uncertainties.  The following are some of the factors that could cause our actual results to differ materially from those expressed in or underlying our forward-looking statements: prevailing economic conditions and general uncertainties relating thereto that may be unknown and unforeseeable; customers’ changing inventory requirements and manufacturing plans and customer decisions to move forward with our new products and product categories; interruptions or weaknesses in our supply chain, illness in our workforce and access to transport for our products; disruptions or limitations in the Company’s manufacturing capacity; average profitability, or mix, of the products we sell; dependence on third-party suppliers and partners; increased raw material, energy and labor costs; fluctuations in currency exchange; the ability to meet development milestones with key customers; and the consequences of other geopolitical events, including natural disasters, acts of war, and global health crises.  This list of important factors is not all inclusive. For a description of certain additional factors that could cause the Company’s future results to differ from those expressed in any such forward-looking statements, see Part I Item 1A, entitled “Risk Factors,” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, and other filings with the United States Securities and Exchange Commission, including the Company’s quarterly reports on Form 10-Q and current reports on Form 8-K.

Except as required by law or regulation, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, therefore you should not rely on these forward-looking statements as representing our views as of any date other than today.

Non-U.S. GAAP Financial Measures

This release contains certain non-GAAP financial measures, including organic net sales and adjusted-diluted EPS.  For the purpose of aiding the comparison of our year-over-year results, we may refer to net sales and other financial results excluding the effects of changes in foreign currency exchange rates.  Organic net sales exclude the impact from acquisitions and/or divestitures and translate the current-period reported sales of subsidiaries whose functional currency is other than the U.S. Dollar at the applicable foreign currency exchange rates in effect during the comparable prior-year period.  We may also refer to financial results excluding the effects of unallocated items.  The re-measured results excluding effects from currency translation and excluding the effects of unallocated items are not in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) and should not be used as a substitute for the comparable U.S. GAAP financial measures.  The non-U.S. GAAP financial measures are incorporated into our discussion and analysis as management uses them in evaluating our results of operations and believes that this information provides users a valuable insight into our overall performance and financial position.  A reconciliation of these adjusted non-U.S. GAAP measures to the comparable U.S. GAAP financial measures is included in the accompanying tables.

 

 

 

 

 

 

 

Trademark Notices

Trademarks and registered trademarks are the property of West Pharmaceutical Services, Inc., in the United States and other jurisdictions, unless noted otherwise.

Daikyo Crystal Zenith® and Daikyo CZ® are registered trademarks of Daikyo Seiko, Ltd. Daikyo Crystal Zenith technologies are licensed from Daikyo Seiko, Ltd.

View original content to download multimedia:https://www.prnewswire.com/news-releases/west-announces-first-quarter-2024-results-and-declares-third-quarter-2024-dividend-302126854.html

SOURCE West Pharmaceutical Services, Inc.

Featured image: Depositphotos © stokkete

Disclaimer