PARSIPPANY, N.J., Feb. 06, 2025 (GLOBE NEWSWIRE) -- Embecta Corp. ("embecta” or the "Company") (Nasdaq: EMBC), a global diabetes care company, today reported financial results for the three month period ended December 31, 2024.
"Building on our momentum from 2024, embecta began the year with solid performance," said Devdatt (Dev) Kurdikar, Chief Executive Officer of embecta. "We remain on track to complete the restructuring plan associated with the discontinuation of the insulin patch pump program by the end of the first half of the fiscal year and are preparing to launch our brand transition plan in the second half, beginning in the U.S. and Canada. Additionally, we continue to make progress on our GLP-1 initiatives targeted to make it easier for patients to access our pen needles for use with GLP-1 pen injectors."
"Given our first-quarter performance and outlook for the remainder of the year, we are updating our guidance - adjusting our revenue outlook solely due to changes in foreign exchange assumptions but still raising expectations for certain key financial metrics. Looking ahead, we are excited to share our long-term strategy for the business, as well as a multi-year financial outlook, at our Investor and Analyst Day in late May 2025."
First Quarter Fiscal Year 2025 Financial Highlights:
- Revenues of $261.9 million, down 5.6% on a reported basis; down 4.8% on an adjusted constant currency basis
- U.S. revenues decreased 4.6% on both a reported and adjusted constant currency basis
- International revenues decreased 6.6% on a reported basis, and 5.1% on an adjusted constant currency basis
- Gross profit and margin of $157.1 million and 60.0%, compared to $185.9 million and 67.0% in the prior year period
- Adjusted gross profit and margin of $164.2 million and 62.7%, compared to $186.3 million and 67.2% in the prior year period
- Operating income and margin of $28.7 million and 11.0%, compared to $45.5 million and 16.4% in the prior year period
- Adjusted operating income and margin of $80.5 million and 30.7%, compared to $77.5 million and 27.9% in the prior year period
- Net income and earnings per diluted share of $0.0 million and $0.00, compared to $20.1 million and $0.35 in the prior year period
- Adjusted net income and adjusted earnings per diluted share of $38.3 million and $0.65, compared to $35.3 million and $0.61 in the prior year period
- Adjusted EBITDA and margin of $97.3 million and 37.2%, compared to $90.4 million and 32.6% in the prior year period
- Announced a dividend of $0.15 per share
- Strengthen core business
- Brand transition program progressing as planned, with U.S. and Canada expected to transition in the second half of fiscal year 2025
- Expand product portfolio
- Progressed in our initiatives targeted to make our pen needles available as co-packaged with potential generic GLP-1 drugs and in retail packaging
- Increase financial flexibility
- Restructuring plan related to the discontinuation of the insulin patch pump program remains on track, expected to be complete by the end of the first half of fiscal year 2025
- During the fiscal year 2025 first quarter, the Company paid an aggregate principal amount of approximately $32.4 million outstanding under its term loan B facility that had an interest rate of 300 basis points over the secured overnight financing rate ("SOFR”), with a 0.50% SOFR floor
First Quarter Fiscal Year 2025 Results:
Revenues by geographic region are as follows:
| Three months ended December 31, | |||||||||||||||||||||||||||||
| Dollars in millions | % Increase/(decrease) | ||||||||||||||||||||||||||||
| 2024 | 2023 | Reported Revenue Growth | Currency Impact | Adjustment Impact | Adjusted Constant Currency Revenue Growth | ||||||||||||||||||||||||
| Reported Revenues | Adjustment | Adjusted Revenues | Reported Revenues | Adjustment | Adjusted Revenues | % | |||||||||||||||||||||||
| United States | $ | 141.7 | $ | - | $ | 141.7 | $ | 148.6 | $ | - | $ | 148.6 | (4.6 | )% | - | % | - | % | (4.6 | )% | |||||||||
| International | 120.2 | - | 120.2 | 128.7 | - | 128.7 | (6.6 | ) | (1.5 | ) | - | (5.1 | ) | ||||||||||||||||
| Total | $ | 261.9 | $ | - | $ | 261.9 | $ | 277.3 | $ | - | $ | 277.3 | (5.6 | )% | (0.8 | )% | - | % | (4.8 | )% | |||||||||
| Three months ended December 31, | |||||||||||||||||||||||||||||
| Dollars in millions | % Increase/(Decrease) | ||||||||||||||||||||||||||||
| 2024 | 2023 | Reported Revenue Growth | Currency Impact | Adjustment Impact | Adjusted Constant Currency Revenue Growth | ||||||||||||||||||||||||
| Reported Revenues | Adjustment | Adjusted Revenues | Reported Revenues | Adjustment | Adjusted Revenues | % | |||||||||||||||||||||||
| Pen Needles | $ | 191.1 | $ | - | $ | 191.1 | $ | 209.8 | $ | - | $ | 209.8 | (8.9 | )% | (0.4 | )% | - | % | (8.5 | )% | |||||||||
| Syringes | 28.4 | - | 28.4 | 30.8 | - | 30.8 | (7.8 | ) | (3.6 | ) | - | (4.2 | ) | ||||||||||||||||
| Safety | 34.2 | - | 34.2 | 30.8 | - | 30.8 | 11.0 | (0.3 | ) | - | 11.3 | ||||||||||||||||||
| Other1 | 3.4 | - | 3.4 | 4.0 | - | 4.0 | (15.0 | ) | (2.5 | ) | - | (12.5 | ) | ||||||||||||||||
| Contract Manufacturing | 4.8 | - | 4.8 | 1.9 | - | 1.9 | 152.6 | - | - | 152.6 | |||||||||||||||||||
| Total | $ | 261.9 | $ | - | $ | 261.9 | $ | 277.3 | $ | - | $ | 277.3 | (5.6 | )% | (0.8 | )% | - | % | (4.8 | )% | |||||||||
The Company's revenues decreased by $15.4 million, or 5.6%, to $261.9 million for the three months ended December 31, 2024 as compared to revenues of $277.3 million for the three months ended December 31, 2023. Changes in revenues are driven by the volume of goods that the Company sells, the prices it negotiates with customers, and changes in foreign exchange rates. The decrease in revenues was driven by $17.9 million of unfavorable changes in volume and $2.0 million associated with the negative impact of foreign currency translation primarily due to the strengthening of the U.S. dollar. This was partially offset by a $2.9 million increase in contract manufacturing revenues related to sales of non-diabetes products to Becton, Dickinson and Company ("BD") and $1.6 million of favorable changes in price.
Fiscal Year 2025 Updated Financial Guidance:
For fiscal year 2025, the Company now expects:
| Dollars in millions, except percentages and per share data | Current | Previous (1) | ||||
| Reported Revenues | $1,075 - $1,092 | $1,093 - $1,110 | ||||
| Reported Revenue Growth (%) | (4.3)% - (2.8)% | (2.7)% - (1.2)% | ||||
| Impact of F/X (%) | (2.2)% | (0.6)% | ||||
| Impact of Italian Payback Measure (2) (%) | 0.4% | 0.4% | ||||
| Adjusted Constant Currency Revenue Growth (%) | (2.5)% - (1.0)% | (2.5)% - (1.0)% | ||||
| Adjusted Gross Margin (%) | 63.25% - 64.25% | 63.25% - 64.25% | ||||
| Adjusted Operating Margin (%) | 29.50% - 30.50% | 29.00% - 30.00% | ||||
| Adjusted Earnings per Diluted Share | $2.70 - $2.90 | $2.70 - $2.90 | ||||
| Adjusted EBITDA Margin (%) | 36.00% - 37.00% | 35.50% - 36.50% | ||||
| (1) | Previous guidance was issued on November 26, 2024. |
| (2) | Reflects the recognition of incremental Italian payback accruals resulting from the two July 22, 2024 rulings by the Constitutional Court of Italy relating to certain prior years since 2015 recorded in Revenues. |
Balance sheet, Liquidity and Other Updates
As of December 31, 2024, the Company had approximately $216.7 million in cash and equivalents and restricted cash and $1.569 billion of debt principal outstanding, and no amount drawn on its $500 million Revolving Credit Facility.
The Company's Board of Directors declared a quarterly cash dividend of $0.15 for each issued and outstanding share of the Company's common stock. The dividend is payable on March 14, 2025 to stockholders of record at the close of business on February 28, 2025.
First Quarter Fiscal Year 2025 Earnings Conference Call:
Management will host a conference call at 8:00 a.m. Eastern Time (ET) on February 6, 2025 to discuss the results of the quarter, provide an update on its business, and host a question and answer session. Those who would like to participate may access the live webcast here, or access the teleconference here. The live webcast can also be accessed via the company's website at investors.embecta.com.
A webcast replay of the call will be available beginning at 11:00 a.m. ET on February 6, 2025, via the embecta investor relations website and archived on the website for one year.
| Condensed Consolidated Statements of Income Embecta Corp. (Unaudited, in millions, except per share data) | |||||||
| Three Months Ended December 31, | |||||||
| 2024 | 2023 | ||||||
| Revenues | $ | 261.9 | $ | 277.3 | |||
| Cost of products sold | 104.8 | 91.4 | |||||
| Gross Profit | $ | ()[\]\\.,;:\s@\"]+)*)|(\".+\"))@((\[[0-9]{1,3}\.[0-9]{1,3}\.[0-9]{1,3}\.[0-9]{1,3}\])|(([a-zA-Z\-0-9]+\.)+[a-zA-Z]{2,}))$/;return b.test(a)}$(document).ready(function(){if(performance.navigation.type==2){location.reload(true)}$("iframe[data-lazy-src]").each(function(b){$(this).attr("src",$(this).attr("data-lazy-src"))});if($(".owl-article-body-images").length){$(".owl-article-body-images").owlCarousel({items:1,loop:true,center:false,dots:false,autoPlay:true,mouseDrag:false,touchDrag:false,pullDrag:false,nav:true})}var a=$("#display_full_text").val();if(a==0){$.ajax({url:"/ajax/set-article-cookie",type:"POST",data:{cmsArticleId:$("#cms_article_id").val()},dataType:"json",success:function(b){},error:function(b,d,c){}})}$(".read-full-article").on("click",function(d){d.preventDefault();var b=$(this).attr("data-cmsArticleId");var c=$(this).attr("data-productId");var f=$(this).attr("data-href");dataLayer.push({event:"paywall_click",paywall_name:"the_manila_times_premium",paywall_id:"paywall_article_"+b});$.ajax({url:"/ajax/set-article-cookie",type:"POST",data:{cmsArticleId:b,productId:c},dataType:"json",success:function(e){window.location.href=$("#BASE_URL").val()+f},error:function(e,h,g){}})});$(".article-embedded-newsletter-form .close-btn").on("click",function(){$(".article-embedded-newsletter-form").fadeOut(1000)})});$(document).on("click",".article-embedded-newsletter-form .newsletter-button",function(){var b=$(".article-embedded-newsletter-form .newsletter_email").val();var d=$("#ga_user_id").val();var c=$("#ga_user_yob").val();var a=$("#ga_user_gender").val();var e=$("#ga_user_country").val();if(validateEmail(b)){$.ajax({url:"/ajax/sendynewsletter",type:"POST",data:{email:b},success:function(f){$(".article-embedded-newsletter-form .nf-message").html(f);$(".article-embedded-newsletter-form .nf-message").addClass("show");setTimeout(function(){$(".article-embedded-newsletter-form .nf-message").removeClass("show");$(".article-embedded-newsletter-form .nf-message").html("")},6000);dataLayer.push({event:"newsletter_sub",user_id:d,product_name:"newsletter",gender:a,yob:c,country:e})},error:function(f,h,g){}})}else{$(".article-embedded-newsletter-form .nf-message").html("Please enter a valid email address.");$(".article-embedded-newsletter-form .nf-message").addClass("show");setTimeout(function(){$(".article-embedded-newsletter-form .nf-message").removeClass("show");$(".article-embedded-newsletter-form .nf-message").html("")},6000)}});$(document).on("click",".article-embedded-newsletter-form .nf-message",function(){$(this).removeClass("show");$(this).html("")});
| |||||