Assessment of the Economic Position

Sartorius in Fiscal 2014

Sartorius performed very successfully in fiscal 2015, substantially exceeding its sales and earnings targets communicated at the beginning of the year. With the sale of the Industrial Technologies Division at the start of the reporting year, the company further sharpened the focus of its portfolio in line with the Sartorius 2020 strategic plan. In addition, the product offering of the Bioprocess Solutions Division was considerably expanded by the acquisition of the companies BioOutsource and Cella in the area of bioprocess development.

Consolidated sales revenue thus grew more strongly than forecasted at the outset of the year, by 16.0% in constant currencies. In view of dynamic sales development, the Group’s margin based on underlying EBITDA also exceeded the target projected in January 2015 – due to economies of scale. This margin, which includes a positive currency effect of about 0.5 of a percentage point, increased in the reporting year to 23.6%.

The Bioprocess Solutions Division was again the major growth engine. In light of the stronger-than-expected expansion of the global biopharmaceutical market and of the division's additional market share gains, it grew significantly by double digits, thus exeeding our expectations. The Lab Products & Services Division performed in the reporting year in line with our expectations.

The ratio of net debt to underlying EBITDA for the last twelve months stood at 1.3 as of December 31, 2015, relative to 1.7 a year ago, and therefore developed as anticipated at the beginning of the year. As a result, the Sartorius Group continues to have significant financing flexibility to implement its strategy.

In the reporting year, Sartorius further invested in the expansion of several manufacturing sites, its IT systems and in the consolidation and expansion of its Group headquarters in Goettingen, Germany. The Group's capex ratio was 10.1%, the level projected at the beginning of the year.

Projected | Actual Comparison for the year 2015

Guidance Guidance Guidance Guidance Actual
January 2015 April 2015 July 2015 October 2015 2015
Sartorius Group
Sales growth1) ~4 % – 7 % ~6 % – 9 % ~12 % ~15 % 16.0 %
Underlying EBITDA margin2) ~21.5 %1) ~22.0 %1) ~22.5 %1) ~23.0 %1) 23.6 %
Gearing (underlying) < 1.7 < 1.7 < 1.7 < 1.7 1.3
CAPEX ratio ~10 % ~10 % ~10 % ~10 % 10.1 %
  
Sartorius Sparten
Bioprocess Solutions
Sales growth1)
~5 % – 8 % ~8 % – 11 % ~15 % ~20 % 20.9 %
Underlying EBITDA margin2)
~24.5 %1) ~25.0 %1) ~25.5 %1) ~26.0 %1) 26.5 %
Lab Products & Services
Sales growth1)
~2 % – 5 % ~2 % – 5 % ~5 % ~5 % 5.0 %
Underlying EBITDA margin2)
~15.51) ~15.51) ~15.5 %1) ~15.5 %1) 16.0 %
 

1) In constant currencies

2) underlying