Gerresheimer sees record revenue growth in Q3 2021, customers to bear the brunt of raw material, energy price hikes
Management described the quarter as one of the strongest in Gerresheimer’s history.
The biological solutions division outperformed again with more than 30% revenue growth year over year, said Dr Bernd Metzner, the company’s chief financial officer.
“We achieved an organic adjusted EBITDA increase of 3.5% despite headwinds from higher prices for raw materials and energy. This shows that we are quite resilient against the inflationary pressure and demonstrates that our strong market positive provides significant pricing power,” he said on a call with analysts.
Raw material, energy prices
As costs for raw materials such as plastic resin, electricity and gas have risen sharply over the past few months, the company said it is taking “suitable and short-term effective measures” to counteract those price hikes.
“These headwinds are only temporary in nature and we will be able to pass the prices increases onto customers,” continued Dr Metzner.
Historically, Gerresheimer has not been aggressive on prices, certainly in the past 10 years, said an analyst on the call, who wondered what the attitude of customers was to those price increases.
In response, management acknowledged the sensitive nature of the topic but said they were managing the process in “a fair and very effective way.”
Demand for ready-to-fill vials is increasing, commented the executives when pressed for details on the syringes market potential. Indeed, the company expects to see solid double-digit growth in syringes in 2022.
Management also reiterated a statement from last August that the company plans to upgrade the capacity it added in response to the COVID-19 crisis to support the production of high-value products such as ready-to-fill vials when the pandemic ends.