Merck KGaA, a leading science and technology company, delivered profitable growth despite challenges in fiscal 2022. Group net sales increased by 12.9% (organically: 6.4%) to € 22,232 million compared with the previous year. Sales growth was driven by all regions and business sectors, particularly Life Science. The Big 3 businesses – Process Solutions and Life Science Services, new Healthcare products as well as Semiconductor Solutions – accounted for almost 90% of the organic growth in sales. EBITDA pre rose by 12.2% (organically: 6.1%) to € 6,849 million. The EBITDA pre margin was 30.8%.

 

Earnings per share pre came in at € 10.05, an increase of 15.3% over the previous year. Based on this, the Executive Board and Supervisory Board will propose to the Annual General Meeting on April 28, 2023, a dividend of € 2.20 per share, equivalent to € 0.35 or 19% more than in the previous year.

 

“We delivered profitable growth in fiscal 2022 despite challenges,” said Belén Garijo, Chair of the Executive Board and CEO of Merck. “The strong development of the Life Science core business more than offset the expected decline in Covid-19-related demand. Other strategic growth engines, namely new Healthcare products and our Semiconductor Solutions business unit, also performed well in fiscal 2022.”

 

Organically, Merck generated a 6.4% increase in Group sales in fiscal 2022. Positive foreign exchange effects of 6.1% resulted mainly from the development of the U.S. dollar and Chinese renminbi. The acquisition of the biopharmaceutical contract development and manufacturing organization Exelead, Inc., USA (Exelead), increased sales by 0.4%. EBITDA pre showed organic growth of 6.1% amid a positive foreign exchange effect of 6.4% and a slightly negative portfolio effect of  0.3%.

 

In 2022, Merck continued with the global expansion of its capacities. The company is thus creating the basis for further organic growth, while at the same time diversifying and regionalizing its production and supply chains. The investments announced by Merck included the expansion of the Life Science sites in Cork, Ireland, Rockville, Maryland, USA, Molsheim, France, as well as Wuxi, China. Healthcare laid the cornerstones for the Translational Science Center and the Launch & Technology Center in Darmstadt, Germany. In February 2023, Electronics celebrated the groundbreaking of its integrated production facility for specialty gases and semiconductor materials in Kaohsiung, Taiwan.

 

Additionally, Merck invested in inorganic growth in 2022, successfully completing the acquisitions of the biopharmaceutical contract development and manufacturing organization Exelead, Inc., USA, as well as the chemical business of Mecaro Co. Ltd., a Korea-based supplier to the semiconductor industry.

 

In Healthcare, Merck presented strong data from its pipeline in 2022 with regard to Phase II studies for xevinapant (head and neck cancer) and evobrutinib (multiple sclerosis). In addition, the company announced in-licensing agreements for its Oncology franchise with Nerviano Medical Sciences S.r.l. as well as a collaboration agreement for antibody-drug conjugates with Mersana Therapeutics, Inc.

 

“Our innovative power and global diversification are key pillars of our resilience,” said Belén Garijo. “Thanks to our broad positioning, we are confident to achieve our mid-term financial target of € 25 billion in sales by 2025 based purely on organic growth – with the option of further accelerating our growth through potential acquisitions and in-licensing deals.”

 

Overall, Merck assumes that 2023 will be a challenging year. The slowing semiconductor market, decreasing Covid-19-related demand and persistently high inflation will contribute to this. Nevertheless, the company reaffirms its mid-term financial target of € 25 billion in net sales by 2025.

 

For fiscal 2023, Merck expects slight to solid organic growth in net sales. All business sectors will contribute to this, with the main growth drivers being Process Solutions and new Healthcare products. The core business – without Covid-19-related sales – is likely to deliver solid to strong organic net sales growth.

 

For EBITDA pre, which will be impacted by cost inflation, Merck assumes a moderate decline to an about stable development organically.