The pharmaceutical and chemical company is navigating the pandemic fairly unscathed. Demand for laboratory equipment is booming and acquisitions in the United States are paying off. Merck is now setting higher goals.
Darmstadt (dpa) – The pharmaceutical and chemical company Merck is gaining speed despite the corona pandemic and is becoming even more optimistic for the current year.
The burgeoning lab division gave the DAX company more tailwind in the third quarter, but the semiconductor business also took off. Group-wide sales rose 9.7 percent year-on-year to € 4.4 billion between July and September, as Merck KGaA announced on Thursday in Darmstadt. CEO Stefan Oschmann spoke of an “excellent business result”. The consequences of the crisis of the crown would have diminished.
Due to a special income, adjusted operating profit (Ebitda) grew disproportionately by 53 percent to 1.7 billion euros. Following a patent dispute with the US company Biogen, Merck had released provisions for 365 million euros. The end result was that the profit was doubled to more than 800 million euros. Merck is navigating the pandemic fairly unscathed. However, the consequences of this will be felt by the inhabitants of southern Hesse when there is weak demand in the business of pigments for automotive paints and cosmetics.
Merck is now further polishing the annual targets that were previously lowered during the Corona crisis: For 2020, the Executive Board is targeting a sales increase of up to € 17.5 billion (previous year: € 16.2 billion). Adjusted operating profit should also increase significantly. The forecasts do not take into account the economic consequences of the corona pandemic and possible new blockades.
In the third quarter, the laboratory division was rock solid with sales increasing over eleven percent. It benefited from good business in products and services for pharmaceutical production. In addition, Merck was able to secure new orders. The division supplies laboratory supplies to more than 50 corona vaccine projects, as well as diagnostic reagents and products. The lawsuit will last longer here, Oschman said. Merck also caught up in collaboration with academic labs after many had to close in the summer due to Corona.
The specialty materials division increased sales by around 43 percent thanks to acquisitions. The semiconductor business was the biggest workhorse. Merck wants to align the division more closely with the electronics industry. Last year, the group took over US semiconductor supplier Versum Materials and Californian materials specialist Intermolecular. Acquisitions pay off with high contributions.
In contrast, Merck faced additional losses in the display solutions business. Apart from the corona crisis, the area has long struggled with Asian competition in liquid crystals, which are used, for example, for screens and smartphones.
In the pharmaceuticals division, sales were slightly below the previous year. Currency effects had a negative impact here and revenue was lost from the sale of the allergy business at the beginning of the year. Sales rose dramatically with Merck’s top hopes, the Mavenclad multiple sclerosis tablet and the Bavencio cancer drug. The fertility products business also got back on track, having seen many clinics closed in the first half of the year.