BERLIN:German healthcare and chemicals company Merck on Thursday lifted its full-year outlook after the $17 billion purchase in November of Sigma-Aldrich buoyed second-quarter earnings.
The company said second-quarter earnings before exceptional items climbed by almost 29% to just under €1.16 million ($1.29 billion) as sales rose by 18.2% to €3.8 billion.
Profit at Merck’s life science unit, which houses most of the Sigma-Aldrich operations, more than doubled, whereas healthcare earnings rose 16.1%. Overall sales rose 18.2% to €3.8 billion.
Just as peer Bayer (BAYRY) announced last week, healthcare, where products include top-selling multiple sclerosis drug Rebif, outshone Merck’s chemicals businesses. Both sales and earnings fell in Merck’s chemicals, or performance materials, division, where products include liquid crystals for LCD televisions.
“We again achieved everything we aimed for in the second quarter. That applies to both the Sigma-Aldrich integration and the development of new medicines,” said chairman and CEO Stefan Oschmann. “Strong demand for our products and dynamic market developments gave our healthcare and life science businesses additional tailwinds. Since particularly in Healthcare our performance in the second quarter was so good, we have decided to lift our forecast for the full year.”
The company is now expecting Ebitda before exceptional items of between €4.25 billion and €4.4 million in 2016, up from a previous forecast of €4.1 billion to € 4.3 billion, and compared with just under €3.63 billion last year.
Merck expects 2016 revenue of between €14.9 billion and €15.1 billion, up from a previous forecast of €14.8 billion to € 15.0 billion, and after Merck posted revenue of €12.84 billion last year. Merck now expects a “moderate” rather than “slight” increase in organic sales.
