- Net sales of $1.70 billion,
decrease of 2.4%; organic decline of 2.0%
- Net income of $93 million;
Adjusted EBITDA of $306 million
- Diluted GAAP EPS of $0.14;
adjusted EPS of $0.25
- Operating cash flow of $281
million; free cash flow of $235
million
RADNOR,
Pa., July 26, 2024 /PRNewswire/ -- Avantor,
Inc. (NYSE: AVTR), a leading global provider of mission-critical
products and services to customers in the life sciences and
advanced technology industries, today reported financial results
for its second fiscal quarter ended June 30,
2024.
"Our teams delivered another solid quarter with sequential
improvements to all key financial metrics. Improved mix from
increased bioprocessing revenue together with the accelerated
impact of our cost transformation initiative drove more than 100
basis points of sequential Adjusted EBITDA margin expansion, while
disciplined working capital management led to free cash flow
conversion above 100%," said Michael
Stubblefield, President and Chief Executive Officer.
"We are reaffirming our fiscal year 2024 guidance and remain
focused on executing our long-term growth strategy and delivering
value to our customers and shareholders," Stubblefield
concluded.
Second Quarter 2024
For the three months ended June 30,
2024, net sales were $1,702.8
million, a decrease of 2.4% compared to the second quarter
of 2023. Foreign currency translation had a negative impact of
0.4%, resulting in a sales decline of 2.0% on an organic basis.
Net income increased to $92.9
million from ($7.3) million in
the second quarter of 2023, and adjusted net income was
$168.0 million as compared to
$186.4 million in the comparable
prior period. Net Income margin was 5.5%. Adjusted EBITDA was
$305.6 million and Adjusted EBITDA
margin was 17.9%. Adjusted Operating Income was $277.2 million and Adjusted Operating Income
margin was 16.3%.
Diluted earnings per share on a GAAP basis was $0.14, while adjusted EPS was $0.25.
Operating cash flow was $281.1
million, while free cash flow was $235.3 million. Adjusted net leverage was 3.9x as
of June 30, 2024.
Second Quarter 2024 – Segment Results
Laboratory Solutions
- Net sales were $1,155.7 million,
a reported decrease of 3.2%, as compared to $1,193.8 million in the second quarter of 2023.
Sales declined 2.7% on an organic basis.
- Adjusted Operating Income was $150.9
million as compared to $179.7
million in the comparable prior period. Adjusted Operating
Income margin was 13.1%.
Bioscience Production
- Net sales were $547.1 million, a
reported decrease of 0.5%, as compared to $550.1 million in the second quarter of 2023.
Sales declined 0.3% on an organic basis.
- Adjusted Operating Income was $144.0
million, as compared to $154.2
million in the comparable prior period. Adjusted Operating
Income margin was 26.3%.
Adjusted Operating Income is Avantor's segment reporting
profitability measure under generally accepted accounting
principles and is used by management to measure and evaluate the
performance of our Company's business segments.
Conference Call
We will host a conference call to
discuss our results today, July 26,
2024, at 8:00 a.m. Eastern
Time. The live webcast and presentation, as well as a
replay, will be available on the investor section of Avantor's
website.
About Avantor
Avantor® is a leading life
science tools company and global provider of mission-critical
products and services to the life sciences and advanced technology
industries. We work side-by-side with customers at every step of
the scientific journey to enable breakthroughs in medicine,
healthcare, and technology. Our portfolio is used in virtually
every stage of the most important research, development and
production activities at more than 300,000 customer locations in
180 countries. For more information,
visit avantorsciences.com and find us
on LinkedIn, X (Twitter) and Facebook.
Use of Non-GAAP Financial Measures
To evaluate our
performance, we monitor a number of key indicators. As appropriate,
we supplement our results of operations determined in accordance
with U.S. generally accepted accounting principles ("GAAP") with
certain non-GAAP financial measures that we believe are useful to
investors, creditors and others in assessing our performance. These
measures should not be considered in isolation or as a substitute
for reported GAAP results because they may include or exclude
certain items as compared to similar GAAP-based measures, and such
measures may not be comparable to similarly titled measures
reported by other companies. Rather, these measures should be
considered as an additional way of viewing aspects of our
operations that provide a more complete understanding of our
business. We strongly encourage investors to review our
consolidated financial statements included in reports filed with
the SEC in their entirety and not rely solely on any one single
financial measure or communication.
The non-GAAP financial measures used in this press release are
sales growth (decline) on an organic basis, Adjusted Operating
Income, Adjusted Operating Income margin, Adjusted EBITDA, Adjusted
EBITDA margin, adjusted net income, adjusted EPS, adjusted net
leverage, free cash flow, and free cash flow conversion.
- Sales growth (decline) on an organic basis eliminates
from our reported net sales growth (decline) the impacts of
revenues from any acquired businesses that have been owned for less
than one year and changes in foreign currency exchange rates. We
believe that this measure is useful to investors as a way to
measure and evaluate our underlying commercial operating
performance consistently across our segments and the periods
presented. This measure is used by our management for the same
reason.
- Adjusted Operating Income is our net income or loss
adjusted for the following items: (i) interest expense, (ii) income
tax expense, (iii) amortization of acquired intangible assets, (iv)
losses on extinguishment of debt, (v) charges associated with the
impairment of certain assets, (vi) and certain other adjustments.
Adjusted Operating Income margin is Adjusted Operating
Income divided by net sales as determined under GAAP. We believe
that these measures are useful to investors as ways to analyze the
underlying trends in our business consistently across the periods
presented. These measures are used by our management for the same
reason. Additionally, Adjusted Operating Income is our segment
reporting profitability measure under GAAP.
- Adjusted EBITDA is our net income or loss adjusted for
the following items: (i) interest expense, (ii) income tax expense,
(iii) amortization of acquired intangible assets, (iv) depreciation
expense, (v) losses on extinguishment of debt, (vi) charges
associated with the impairment of certain assets, (vii) and certain
other adjustments. Adjusted EBITDA margin is Adjusted EBITDA
divided by net sales as determined under GAAP. We believe that
these measures are useful to investors as ways to analyze the
underlying trends in our business consistently across the periods
presented. These measures are used by our management for the same
reason.
- Adjusted net income is our net income or loss first
adjusted for the following items: (i) amortization of acquired
intangible assets, (ii) losses on extinguishment of debt, (iii)
charges associated with the impairment of certain assets, (iv) and
certain other adjustments. From this amount, we then add or
subtract an assumed incremental income tax impact on the
above-noted pre-tax adjustments, using estimated tax rates, to
arrive at Adjusted Net Income. We believe that this measure is
useful to investors as a way to analyze the business consistently
across the periods presented. This measure is used by our
management for the same reason.
- Adjusted EPS is our adjusted net income divided by our
diluted GAAP weighted average share count adjusted for
anti-dilutive instruments. We believe that this measure is useful
to investors as an additional way to analyze the underlying trends
in our business consistently across the periods presented. This
measure is used by our management for the same reason.
- Adjusted net leverage is equal to our gross debt,
reduced by our cash and cash equivalents, divided by our trailing
12-month Adjusted EBITDA (excluding stock-based compensation
expense and including the expected run-rate effect of cost
synergies and the incremental results of completed acquisitions as
if those acquisitions had occurred on the first day of the trailing
12-month period). We believe that this measure is useful to
investors as a way to evaluate and measure the Company's capital
allocation strategies and the underlying trends in the business.
This measure is used by our management for the same reason.
- Free cash flow is equal to our cash flow from operating
activities, plus acquisition-related costs paid in the period, less
capital expenditures. Free cash flow conversion is free cash
flow divided by adjusted net income. We believe that these measures
are useful to investors as they provide a view on the Company's
ability to generate cash for use in financing or investment
activities. These measures are used by our management for the same
reason.
Reconciliations of these non-GAAP financial measures to the most
directly comparable GAAP financial measures are included in the
tables accompanying this release.
Forward-Looking and Cautionary Statements
This press
release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, and are subject to the safe harbor
created thereby under the Private Securities Litigation Reform Act
of 1995. All statements other than statements of historical fact
included in this press release are forward-looking statements.
Forward-looking statements discuss our current expectations and
projections relating to our financial condition, results of
operations, plans, including our cost transformation initiative,
objectives, future performance and business. These statements may
be preceded by, followed by or include the words "aim,"
"anticipate," "assumption," "believe," "continue," "estimate,"
"expect," "forecast," "goal," "guidance," "intend," "likely,"
"long-term," "near-term," "objective," "opportunity," "outlook,"
"plan," "potential," "project," "projection," "prospects," "seek,"
"target," "trend," "can," "could," "may," "should," "would,"
"will," the negatives thereof and other words and terms of similar
meaning.
Forward-looking statements are inherently subject to risks,
uncertainties and assumptions; they are not guarantees of
performance. You should not place undue reliance on these
statements. We have based these forward-looking statements on our
current expectations and projections about future events. Although
we believe that our assumptions made in connection with the
forward-looking statements are reasonable, we cannot assure you
that the assumptions and expectations will prove to be correct.
Factors that could contribute to these risks, uncertainties and
assumptions include, but are not limited to, the factors described
in "Risk Factors" in our most recent Annual Report on Form 10-K,
and subsequent quarterly reports on Form 10-Q, as such risk factors
may be updated from time to time in our periodic filings with the
SEC.
All forward-looking statements attributable to us or persons
acting on our behalf are expressly qualified in their entirety by
the foregoing cautionary statements. In addition, all
forward-looking statements speak only as of the date of this press
release. We undertake no obligations to update or revise publicly
any forward-looking statements, whether as a result of new
information, future events or otherwise other than as required
under the federal securities laws.
Investor Relations Contact
Christina Jones
Vice President, Investor Relations
Avantor
+1 805-617-5297
Christina.Jones@avantorsciences.com
Media Contact
Emily
Collins
Vice President, External Communications
Avantor
+1 332-239-3910
Emily.Collins@avantorsciences.com
|
Avantor, Inc. and
subsidiaries
|
|
Unaudited condensed
consolidated statements of operations
|
|
|
(in millions, except
per share data)
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net sales
|
$
1,702.8
|
|
$
1,743.9
|
|
$
3,382.6
|
|
$
3,524.2
|
|
Cost of
sales
|
1,121.3
|
|
1,153.9
|
|
2,230.6
|
|
2,309.4
|
|
Gross
profit
|
581.5
|
|
590.0
|
|
1,152.0
|
|
1,214.8
|
|
Selling, general and
administrative expenses
|
405.7
|
|
357.5
|
|
829.9
|
|
751.1
|
|
Impairment
charges
|
—
|
|
160.8
|
|
—
|
|
160.8
|
|
Operating
income
|
175.8
|
|
71.7
|
|
322.1
|
|
302.9
|
|
Interest expense,
net
|
(60.9)
|
|
(73.4)
|
|
(125.2)
|
|
(147.1)
|
|
Loss on extinguishment
of debt
|
(1.9)
|
|
(1.6)
|
|
(4.4)
|
|
(3.9)
|
|
Other income,
net
|
1.6
|
|
2.0
|
|
2.7
|
|
2.6
|
|
Income (loss) before
income taxes
|
114.6
|
|
(1.3)
|
|
195.2
|
|
154.5
|
|
Income tax
expense
|
(21.7)
|
|
(6.0)
|
|
(41.9)
|
|
(40.3)
|
|
Net income
(loss)
|
$ 92.9
|
|
$
(7.3)
|
|
153.3
|
|
114.2
|
|
|
|
|
|
|
|
|
|
Earnings (Loss) per
share:
|
|
|
|
|
|
|
|
|
Basic
|
$ 0.14
|
|
$ (0.01)
|
|
$ 0.23
|
|
$ 0.17
|
|
Diluted
|
$ 0.14
|
|
$ (0.01)
|
|
$ 0.22
|
|
$ 0.17
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
679.4
|
|
675.3
|
|
678.7
|
|
675.0
|
|
Diluted
|
682.6
|
|
675.3
|
|
681.9
|
|
677.9
|
|
Avantor, Inc. and
subsidiaries
|
|
Unaudited condensed
consolidated balance sheets
|
|
|
(in
millions)
|
June 30,
2024
|
|
December 31,
2023
|
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
272.6
|
|
$
262.9
|
|
Accounts receivable,
net
|
1,129.0
|
|
1,150.2
|
|
Inventory
|
795.6
|
|
828.1
|
|
Other current
assets
|
132.0
|
|
143.7
|
|
Total current
assets
|
2,329.2
|
|
2,384.9
|
|
Property, plant and
equipment, net
|
753.8
|
|
737.5
|
|
Other intangible
assets, net
|
3,582.8
|
|
3,775.3
|
|
Goodwill,
net
|
5,659.6
|
|
5,716.7
|
|
Other assets
|
368.1
|
|
358.3
|
|
Total
assets
|
$
12,693.5
|
|
$
12,972.7
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Current portion of
debt
|
$
258.4
|
|
$
259.9
|
|
Accounts
payable
|
657.4
|
|
625.9
|
|
Employee-related
liabilities
|
146.1
|
|
133.1
|
|
Accrued
interest
|
49.9
|
|
50.2
|
|
Other current
liabilities
|
352.8
|
|
411.2
|
|
Total current
liabilities
|
1,464.6
|
|
1,480.3
|
|
Debt, net of current
portion
|
4,856.6
|
|
5,276.7
|
|
Deferred income tax
liabilities
|
575.4
|
|
612.8
|
|
Other
liabilities
|
361.9
|
|
350.3
|
|
Total
liabilities
|
7,258.5
|
|
7,720.1
|
|
Stockholders'
equity:
|
|
|
|
|
Common stock including
paid-in capital
|
3,897.5
|
|
3,830.1
|
|
Accumulated
earnings
|
1,644.8
|
|
1,491.5
|
|
Accumulated other
comprehensive loss
|
(107.3)
|
|
(69.0)
|
|
Total stockholders'
equity
|
5,435.0
|
|
5,252.6
|
|
Total liabilities and
stockholders' equity
|
$
12,693.5
|
|
$
12,972.7
|
|
Avantor, Inc. and
subsidiaries
|
|
Unaudited condensed
consolidated statements of cash flows
|
|
|
(in
millions)
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$ 92.9
|
|
$ (7.3)
|
|
$
153.3
|
|
$
114.2
|
|
Reconciling
adjustments:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
102.6
|
|
102.6
|
|
202.2
|
|
203.7
|
|
Impairment
charges
|
—
|
|
160.8
|
|
—
|
|
160.8
|
|
Stock-based
compensation expense
|
11.1
|
|
9.2
|
|
23.8
|
|
21.9
|
|
Provision for accounts
receivable and inventory
|
15.5
|
|
30.6
|
|
39.5
|
|
43.1
|
|
Deferred income tax
benefit
|
(34.8)
|
|
(38.3)
|
|
(52.7)
|
|
(64.7)
|
|
Amortization of
deferred financing costs
|
2.8
|
|
3.3
|
|
5.8
|
|
6.7
|
|
Loss on extinguishment
of debt
|
1.9
|
|
1.6
|
|
4.4
|
|
3.9
|
|
Foreign currency
remeasurement (gain) loss
|
(2.2)
|
|
(1.9)
|
|
3.1
|
|
(0.1)
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
(2.7)
|
|
60.1
|
|
—
|
|
7.9
|
|
Inventory
|
(3.2)
|
|
(8.8)
|
|
(14.2)
|
|
(1.7)
|
|
Accounts
payable
|
89.5
|
|
(75.0)
|
|
45.9
|
|
(74.4)
|
|
Accrued
interest
|
9.2
|
|
9.9
|
|
(0.3)
|
|
(0.6)
|
|
Other assets and
liabilities
|
(2.9)
|
|
(78.4)
|
|
6.4
|
|
(34.3)
|
|
Other
|
1.4
|
|
(0.2)
|
|
5.5
|
|
1.3
|
|
Net cash provided by
operating activities
|
281.1
|
|
168.2
|
|
422.7
|
|
387.7
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
(45.8)
|
|
(30.1)
|
|
(80.5)
|
|
(58.1)
|
|
Other
|
0.9
|
|
0.7
|
|
1.4
|
|
1.4
|
|
Net cash used in
investing activities
|
(44.9)
|
|
(29.4)
|
|
(79.1)
|
|
(56.7)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Debt
borrowings
|
(28.9)
|
|
—
|
|
12.3
|
|
—
|
|
Debt
repayments
|
(172.7)
|
|
(190.8)
|
|
(383.0)
|
|
(460.3)
|
|
Payments of debt
refinancing fees and premiums
|
—
|
|
(2.3)
|
|
—
|
|
(2.3)
|
|
Proceeds received from
exercise of stock options
|
5.3
|
|
2.1
|
|
50.8
|
|
4.7
|
|
Shares repurchased to
satisfy employee tax
obligations for vested stock-based
awards
|
(0.8)
|
|
(5.2)
|
|
(7.4)
|
|
(13.3)
|
|
Net cash used in
financing activities
|
(197.1)
|
|
(196.2)
|
|
(327.3)
|
|
(471.2)
|
|
Effect of currency rate
changes on cash and cash equivalents
|
(1.6)
|
|
(0.7)
|
|
(7.3)
|
|
4.1
|
|
Net change in cash,
cash equivalents and restricted cash
|
37.5
|
|
(58.1)
|
|
9.0
|
|
(136.1)
|
|
Cash, cash equivalents
and restricted cash, beginning of period
|
259.2
|
|
318.9
|
|
287.7
|
|
396.9
|
|
Cash, cash equivalents
and restricted cash, end of period
|
$
296.7
|
|
$
260.8
|
|
$
296.7
|
|
$
260.8
|
|
Avantor, Inc. and
subsidiaries
|
|
Reconciliations of non-GAAP
measures
|
|
|
Adjusted EBITDA
and Adjusted EBITDA Margin
|
|
|
(dollars in
millions)
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
$
|
|
%
|
|
$
|
|
%
|
|
$
|
|
%
|
|
$
|
|
%
|
|
Net income
(loss)
|
$ 92.9
|
|
5.5 %
|
|
$
(7.3)
|
|
(0.4) %
|
|
$
153.3
|
|
4.5 %
|
|
$
114.2
|
|
3.2 %
|
|
Amortization
|
74.9
|
|
4.4 %
|
|
78.9
|
|
4.5 %
|
|
150.2
|
|
4.4 %
|
|
157.3
|
|
4.5 %
|
|
Loss on extinguishment
of debt
|
1.9
|
|
— %
|
|
1.6
|
|
0.1 %
|
|
4.4
|
|
0.1 %
|
|
3.9
|
|
0.1 %
|
|
Integration-related
expenses1
|
—
|
|
— %
|
|
(0.6)
|
|
— %
|
|
—
|
|
— %
|
|
8.1
|
|
0.2 %
|
|
Restructuring and
severance charges2
|
9.7
|
|
0.6 %
|
|
7.2
|
|
0.4 %
|
|
32.9
|
|
1.0 %
|
|
11.9
|
|
0.3 %
|
|
Transformation
expenses3
|
16.2
|
|
1.0 %
|
|
—
|
|
— %
|
|
29.5
|
|
0.9 %
|
|
—
|
|
— %
|
|
Other4
|
(0.3)
|
|
— %
|
|
(0.7)
|
|
— %
|
|
(0.8)
|
|
— %
|
|
(0.8)
|
|
— %
|
|
Impairment
charges5
|
—
|
|
— %
|
|
160.8
|
|
9.2 %
|
|
—
|
|
— %
|
|
160.8
|
|
4.6 %
|
|
Income tax benefit
applicable to
pretax adjustments
|
(27.3)
|
|
(1.6) %
|
|
(53.5)
|
|
(3.1) %
|
|
(50.9)
|
|
(1.5) %
|
|
(73.6)
|
|
(2.1) %
|
|
Adjusted net
income
|
168.0
|
|
9.9 %
|
|
186.4
|
|
10.7 %
|
|
318.6
|
|
9.4 %
|
|
381.8
|
|
10.8 %
|
|
Interest expense,
net
|
60.9
|
|
3.6 %
|
|
73.4
|
|
4.2 %
|
|
125.2
|
|
3.7 %
|
|
147.1
|
|
4.2 %
|
|
Depreciation
|
27.7
|
|
1.5 %
|
|
23.7
|
|
1.4 %
|
|
52.0
|
|
1.6 %
|
|
46.4
|
|
1.4 %
|
|
Income tax provision
applicable
to Adjusted Net income
|
49.0
|
|
2.9 %
|
|
59.5
|
|
3.4 %
|
|
92.8
|
|
2.7 %
|
|
113.9
|
|
3.2 %
|
|
Adjusted
EBITDA
|
$
305.6
|
|
17.9 %
|
|
$
343.0
|
|
19.7 %
|
|
$
588.6
|
|
17.4 %
|
|
$
689.2
|
|
19.6 %
|
|
━━━━━━━━━
|
|
1.
|
Represents direct costs
incurred with third parties and the accrual of a long-term
retention incentive to integrate acquired companies. These expenses
represent incremental costs and are unrelated to normal operations
of our business. Integration expenses are incurred over a
pre-defined integration period specific to each
acquisition.
|
|
2.
|
Reflects the
incremental expenses incurred in the period related to
restructuring initiatives to increase profitability and
productivity. Costs included in this caption are specific to
employee severance, site-related exit costs, and contract
termination costs. The expenses recognized in 2024 represent costs
incurred to achieve the Company's publicly-announced cost
transformation initiative.
|
|
3.
|
Represents incremental
expenses directly associated with the Company's publicly-announced
cost transformation initiative, primarily related to the cost of
external advisors.
|
|
4.
|
Represents net foreign
currency (gain) loss from financing activities, other stock-based
compensation expense (benefit) and charges and legal costs in
connection with certain litigation and other contingencies that are
unrelated to our core operations and not reflective of on-going
business and operating results.
|
|
5.
|
Related to impairment
of the Ritter asset group.
|
|
Avantor, Inc. and
subsidiaries
|
|
Reconciliations of non-GAAP measures
(continued)
|
|
|
Adjusted
Operating Income and Adjusted Operating Income
Margin
|
|
|
(dollars in
millions)
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
$
|
|
%
|
|
$
|
|
%
|
|
$
|
|
%
|
|
$
|
|
%
|
|
Net income
(loss)
|
$ 92.9
|
|
5.5 %
|
|
$
(7.3)
|
|
(0.4) %
|
|
$
153.3
|
|
4.5 %
|
|
$
114.2
|
|
3.2 %
|
|
Interest expense,
net
|
60.9
|
|
3.6 %
|
|
73.4
|
|
4.2 %
|
|
125.2
|
|
3.7 %
|
|
147.1
|
|
4.2 %
|
|
Income tax
expense
|
21.7
|
|
1.3 %
|
|
6.0
|
|
0.3 %
|
|
41.9
|
|
1.2 %
|
|
40.3
|
|
1.1 %
|
|
Loss on extinguishment
of debt
|
1.9
|
|
— %
|
|
1.6
|
|
0.1 %
|
|
4.4
|
|
0.1 %
|
|
3.9
|
|
0.1 %
|
|
Other income,
net
|
(1.6)
|
|
(0.1) %
|
|
(2.0)
|
|
(0.1) %
|
|
(2.7)
|
|
— %
|
|
(2.6)
|
|
— %
|
|
Operating
income
|
175.8
|
|
10.3 %
|
|
71.7
|
|
4.1 %
|
|
322.1
|
|
9.5 %
|
|
302.9
|
|
8.6 %
|
|
Amortization
|
74.9
|
|
4.4 %
|
|
78.9
|
|
4.5 %
|
|
150.2
|
|
4.4 %
|
|
157.3
|
|
4.5 %
|
|
Integration-related
expenses1
|
—
|
|
— %
|
|
(0.6)
|
|
— %
|
|
—
|
|
— %
|
|
8.1
|
|
0.2 %
|
|
Restructuring and
severance charges2
|
9.7
|
|
0.6 %
|
|
7.2
|
|
0.4 %
|
|
32.9
|
|
1.0 %
|
|
11.9
|
|
0.3 %
|
|
Transformation
expenses3
|
16.2
|
|
1.0 %
|
|
—
|
|
— %
|
|
29.5
|
|
0.9 %
|
|
—
|
|
— %
|
|
Other4
|
0.6
|
|
— %
|
|
0.9
|
|
0.1 %
|
|
0.9
|
|
— %
|
|
1.0
|
|
— %
|
|
Impairment
charges5
|
—
|
|
— %
|
|
160.8
|
|
9.2 %
|
|
—
|
|
— %
|
|
160.8
|
|
4.6 %
|
|
Adjusted Operating
Income
|
$
277.2
|
|
16.3 %
|
|
$
318.9
|
|
18.3 %
|
|
$
535.6
|
|
15.8 %
|
|
$
642.0
|
|
18.2 %
|
|
━━━━━━━━━
|
|
1.
|
Represents direct costs
incurred with third parties and the accrual of a long-term
retention incentive to integrate acquired companies. These expenses
represent incremental costs and are unrelated to normal operations
of our business. Integration expenses are incurred over a
pre-defined integration period specific to each
acquisition.
|
|
2.
|
Reflects the
incremental expenses incurred in the period related to
restructuring initiatives to increase profitability and
productivity. Costs included in this caption are specific to
employee severance, site-related exit costs, and contract
termination costs. The expenses recognized in 2024 represent costs
incurred to achieve the Company's publicly-announced cost
transformation initiative.
|
|
3.
|
Represents incremental
expenses directly associated with the Company's publicly-announced
cost transformation initiative, primarily related to the cost of
external advisors.
|
|
4.
|
Represents other
stock-based compensation expense (benefit) and charges and legal
costs in connection with certain litigation and other contingencies
that are unrelated to our core operations and not reflective of
on-going business and operating results.
|
|
5.
|
Related to impairment
of the Ritter asset group.
|
|
Avantor, Inc. and
subsidiaries
|
|
Reconciliations of non-GAAP measures
(continued)
|
|
|
Earnings per
share
|
|
|
(shares in
millions)
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Diluted earnings (loss)
per share (GAAP)
|
$ 0.14
|
|
$ (0.01)
|
|
$ 0.22
|
|
$ 0.17
|
|
Dilutive impact of
convertible instruments
|
—
|
|
—
|
|
—
|
|
—
|
|
Fully diluted earnings
(loss) per share (non-GAAP)
|
0.14
|
|
(0.01)
|
|
0.22
|
|
0.17
|
|
Amortization
|
0.11
|
|
0.12
|
|
0.22
|
|
0.23
|
|
Loss on extinguishment
of debt
|
—
|
|
—
|
|
0.01
|
|
0.01
|
|
Integration-related
expenses
|
—
|
|
—
|
|
—
|
|
0.01
|
|
Restructuring and
severance charges
|
0.02
|
|
0.01
|
|
0.05
|
|
0.02
|
|
Transformation
expenses
|
0.02
|
|
—
|
|
0.04
|
|
—
|
|
Other
|
—
|
|
—
|
|
—
|
|
—
|
|
Impairment
charges
|
—
|
|
0.24
|
|
—
|
|
0.24
|
|
Income tax benefit
applicable to pretax adjustments
|
(0.04)
|
|
(0.08)
|
|
(0.07)
|
|
(0.12)
|
|
Adjusted EPS
(non-GAAP)
|
$ 0.25
|
|
$ 0.28
|
|
$ 0.47
|
|
$ 0.56
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
|
Diluted
(GAAP)
|
682.6
|
|
675.3
|
|
681.9
|
|
677.9
|
|
Incremental shares
excluded for GAAP
|
—
|
|
2.4
|
|
—
|
|
—
|
|
Share count for
Adjusted EPS (non-GAAP)
|
682.6
|
|
677.7
|
|
681.9
|
|
677.9
|
|
Free cash
flow
|
|
|
(in
millions)
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net cash provided by
operating activities
|
$
281.1
|
|
$
168.2
|
|
$
422.7
|
|
$
387.7
|
|
Capital
expenditures
|
(45.8)
|
|
(30.1)
|
|
(80.5)
|
|
(58.1)
|
|
Free cash flow
(non-GAAP)
|
$
235.3
|
|
$
138.1
|
|
$
342.2
|
|
$
329.6
|
|
Adjusted net
leverage
|
|
|
(dollars in
millions)
|
June 30,
2024
|
|
Total debt,
gross
|
$ 5,148.3
|
|
Less cash and cash
equivalents
|
(272.6)
|
|
$ 4,875.7
|
|
|
|
Trailing twelve months
Adjusted EBITDA
|
$ 1,208.5
|
|
Trailing twelve months
ongoing stock-based compensation expense
|
42.3
|
|
$ 1,250.8
|
|
|
|
Adjusted net leverage
(non-GAAP)
|
3.9 x
|
|
Avantor, Inc. and
subsidiaries
|
|
Reconciliations of non-GAAP measures
(continued)
|
|
|
Net sales by
segment
|
|
|
(in
millions)
|
June 30,
|
|
Reconciliation of
net sales growth
(decline) to organic net sales growth
(decline)
|
|
|
Net sales
growth
(decline)
|
|
Foreign
currency
impact
|
|
Organic
net sales
growth
(decline)
|
|
|
2024
|
|
2023
|
|
|
Three months
ended:
|
|
|
|
|
|
|
|
|
|
|
|
Laboratory
Solutions
|
$
1,155.7
|
|
$
1,193.8
|
|
$ (38.1)
|
|
$
(5.4)
|
|
$ (32.7)
|
|
|
Bioscience
Production
|
547.1
|
|
550.1
|
|
(3.0)
|
|
(1.3)
|
|
(1.7)
|
|
|
Total
|
$
1,702.8
|
|
$
1,743.9
|
|
$ (41.1)
|
|
$
(6.7)
|
|
$ (34.4)
|
|
|
Six months
ended:
|
|
|
|
|
|
|
|
|
|
|
|
Laboratory
Solutions
|
$
2,312.8
|
|
$
2,396.8
|
|
$ (84.0)
|
|
$
3.6
|
|
$ (87.6)
|
|
|
Bioscience
Production
|
1,069.8
|
|
1,127.4
|
|
(57.6)
|
|
1.7
|
|
(59.3)
|
|
|
Total
|
$
3,382.6
|
|
$
3,524.2
|
|
$
(141.6)
|
|
$
5.3
|
|
$
(146.9)
|
|
|
Adjusted
Operating Income by segment
|
|
|
(in
millions)
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Laboratory
Solutions
|
$ 150.9
|
|
$ 179.7
|
|
$ 299.1
|
|
$ 351.9
|
|
Bioscience
Production
|
144.0
|
|
154.2
|
|
270.9
|
|
321.7
|
|
Corporate
|
(17.7)
|
|
(15.0)
|
|
(34.4)
|
|
(31.6)
|
|
Total
|
$ 277.2
|
|
$ 318.9
|
|
$ 535.6
|
|
$ 642.0
|
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SOURCE Avantor and Financial News