The multinational blood products Grifols earned 21 million euros in the first quarter, a reversal of the losses of 108 million it recorded the previous year due to restructuring costs, as announced to the National Securities Market Commission. The group, which suffered this morning the fourth attack by the bearish fund Gotham City Research, has explained that the results allow it to “maintain its commitment to profitable and sustainable growth, focused on the generation of free cash flow and the reduction Of the debt”.
The fact that the operation was already known has meant that Gotham’s fourth report has had little impact on the Catalan pharmaceutical company’s price, which after initially dropping 5% closed with an increase of 0.45%.
The Grifols family group, now led by Thomas Glanzmann as executive president, announced that revenues reached 1,626 million euros, a figure that was 5.5% higher than last year at constant exchange rates (without taking into account mainly takes into account the changes in the exchange rate of the euro with respect to the dollar).
In monetary terms, revenue growth would have been 6.8%. The main division of the group, called Biopharma, related to the manufacturing and marketing of medicines derived from plasma, earned 1,395 million euros, 9.4% more at constant exchange rates. , driven by strong demand and supply for plasma, with particularly high growth in the European Union (EU). The diagnostics division reduced its revenues by 8.3% and that of BioSupplies by 24.8%.
Plasma supply increased by 8% in the first quarter and the cost per liter decreased again, 2% compared to the end of last year.
In the quarter, the company had an operating profit or adjusted ebitda of 350 million euros, which represents 21.6% of revenues and increased 17% compared to last year.
All in all, the company has consumed cash in the quarter, a period in which it has had a negative free cash flow of 253 million euros, 74% higher than the same period last year.
Grifols justifies this deterioration because it has increased its inventories to meet the expected increase in sales this year; to the increase in debtors, by 154 million, due to the delay of a payment from a Chinese client who entered in April; faster payment to your suppliers; the investment in its subsidiary in Egypt and the 36% increase in interest payments due to the rate increase, to which it allocated 106 million euros in the period.
The CEO, Nacho Abia, reiterated in a meeting with analysts that his first objective is to improve cash generation, to close the year with a cash flow of more than 5 million euros, which could be increased with operational improvements.
Glanzmann explained in the conference with analysts that the net financial debt reached 9,811 million euros – to which 1,137 million euros are added for its rental commitments for its plasma centers. Glanzmann explained that “our main objective is to continue strengthening the company’s financial position” and recalled that the firm has taken “significant steps” to achieve this with the placement of a bond of 1,000 million euros and obtaining authorizations to sell its Chinese subsidiary Shanghai Rass for 1.6 billion euros, which plans to close in June.
The firm, Abia reiterated, plans to reduce its weight, and leave it at 4.5 times the EBITDA at the end of the year, due to the improvement in profit and to amortize part of it with the income from the sale of its subsidiary.
