Acquisition of Bormioli Pharma; Higher
Profitability Expected; Strategic Review of
New Moulded Glass
Dietmar Siemssen, CEO
Dr. Bernd Metzner, CFO
Düsseldorf, May 23, 2024
Disclaimer
This publication can contain forward-looking statements relating to key issues as strategy, future financial results, events, competitive positions and product developments of the Company, the Gerresheimer group or the industry in which the Gerresheimer group operates. Such forward-looking statements are - like any entrepreneurial activity in a global environment - subject to a number of risks and uncertainties. They are subject to a large number of risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should underlying expectations not occur or assumptions prove incorrect, actual results, performances or achievements of the Gerresheimer group may vary materially from those described in the relevant forward-looking statements. These forward-looking statements may be identified by words such as "expect," "want," "anticipate," "intend," "plan," "believe," "seek," "estimate," "will," "project" or words of similar meaning. Gerresheimer AG neither intends, nor assumes any obligation, to update or revise its forward-looking statements regularly in light of developments which differ from those anticipated.
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Acquisition of Bormioli Pharma Strengthening Our Systems Integration - Strategic Review of New Moulded Glass - Accelerating our Transformation
- Bormioli Pharma highly strategic and complementary with our existing portfolio and footprint
- Profitable growth track record, attractive margins and cash generation - accretive to our margins and EPS trajectory
- Substantial synergies accelerating value creation for shareholders
- Initiating Strategic Review to explore options for Our New Moulded Glass Powerhouse
- Delivering on our vision - Strengthening breadth of our platform - Accelerating our transformation journey
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Transaction Summary
Bormioli | ▪ | Italy based manufacturer of plastic and moulded glass solutions for pharma markets | |
▪ | Revenues of ~€370m with adj EBITDA margin of ~21%, per FY24E | ||
Pharma | |||
▪ | 60-70% normalized cash conversion1 | ||
Key Transaction Terms
- Acquiring 100% of Bormioli Pharma Group from Triton Group
- Transaction value of approximately €800m
- Adj EBITDA multiple of c. 10x pre synergies, per FY24E
- Attractive synergies reducing acquisition multiple
- All cash acquisition
- Funded by acquisition bridge
- Closing expect in Q4 2024, subject to customary closing conditions and approvals
Key Financials
- Outlook for Bormioli Pharma:
- Mid single digit organic revenue CAGR
- On track to achieve adj EBITDA margins of ~25% near to mid term
- In addition attractive synergies of 3-5% of Bormioli Pharma revenues
- Impact on Gx:
- Adj EBITDA margin accretion of 50 - 100 bps near term
- Adj EPS accretion of >10% already in first year after closing
- Strong cash contributor
- Leverage temporarily higher - mid to high 3s x adj EBITDA on closing
- Quick deleveraging towards our target leverage of ≤3.0x within one year from closing
- Strategic review of our new Moulded Glass Powerhouse
4 Note: (1) Normalized cash conversion defined as 3yr average of adj EBITDA - Capex as % of adj EBITDA
Key Acquisition Highlights - Strong Strategic Fit Across Portfolio
Highly
Complementary Portfolio
Extending Integrated
Systems Offering and
Creating a One-Stop-Shop
Platform
Highly Attractive Financial Trajectory
Significant Synergies
- Complementary offering of primary pharma plastic and moulded glass containment solutions
- Enhancing Gx's Primary Plastics portfolio with full range of smart closures, rubber stoppers, accessories for containers and dual chamber solutions
- Exposure to attractive parental pharma Type 1 and Type 2 markets in moulded glass
- Southern European footprint complementing our Northern and Central European presence
- Enabling integrated systems offering within containment solutions supporting High Value Solutions pipeline
- Integrated primary pharma plastics container + smart closures supporting Container Closure Integrity (CCI)
- Integrated vial + rubber stopper solutions offering for injectable customers
- Creation of a one-stop-shop for PharmaCos globally by delivering the breadth of the Gx platform
- Highly profitable with adj EBITDA margin of ~21%, per FY24E with ~25% near to mid term before synergies
- Mid single digit organic revenue CAGR
- Attractive cash generation with 60-70% normalized cash conversion1
- Substantial synergies across portfolio given strategic fit and complementarity of our portfolio
- Expected synergies of c. 3-5% of Bormioli Pharma revenues
- Significant portion of synergies achieved within first 2 years after closing
5 Note: (1) Normalized cash conversion defined as 3yr average of adj EBITDA - Capex as % of adj EBITDA
Accelerating the Transformation of Gerresheimer
Accretive to Our Stated Financial Ambitions
New Moulded Glass Powerhouse - Strategic Review Initiated
Revenue
Growth
Profile
Adj EBITDA
Margin
Profile
Adj EPS
Profile
Deleveraging Profile
Mid-term Guidance
≥ 10% CAGR
23-25% adj EBITDA
margin
≥ 10% CAGR
<3x Net Debt/
adj EBITDA
Acquisition Impact
Unchanged
50 to 100 bps margin accretion near-term
Accretive in adj EPS >10% from year-1
≤3.0x within 1 year after closing, supported by strong cash conversion and synergies
- Enables creation of a new global Pharma and Cosmetics Moulded Glass Powerhouse
- Bormioli Pharma's parental Pharma exposure complementing Gerresheimer's Pharma and cosmetic / food & beverage exposure
- Strong ~€750m revenue with adj EBITDA margin of ~21% pro forma per FY24E
- On track to achieve mid 20s % adj EBITDA margin mid term
- Mid single digit organic revenue growth profile
- Greater size and scale - more diversified end-market exposure - attractive financial trajectory
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The New Gerresheimer - Creation of Three Market Leading Platforms
~30% | Moulded Glass |
- Global Moulded Glass Powerhouse
- Includes Pharma Type I, II, III, Cosmetics and Food & Beverage solutions
- Mid single digit revenue growth
- Margin upside opportunity
~30% Delivery Systems
- Bring the drug into the patient
- Integrated delivery systems including syringes and medical devices
- Strong double digit organic growth profile
Strategic Review
Initiated
~40% Containment Solutions
- Bring the drug to the patient
-
Integrated containment solutions across plastics, tubular glass and
US prescription vials - High single digit organic growth
- Highly attractive margins and cash generation profile, further accelerated via High Value Solutions
- Profitability turbo-charging with High Value Solutions pipeline ramp-up
% Pro Forma 2024E Sales
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Bormioli Pharma - Business Overview
General Information
Established in 1825, Bormioli Pharma is a leading pharma primary packaging manufacturer
HQ: Italy
Product Overview
Leading Primary Pharma Solutions Provider with a Differentiated Offering
~1,500 employees
Markets
Global presence in over 100 countries
Well invested Southern European footprint, with 9 plants distributed across Italy (5), Germany (3) and France (1)
Serves a diversified blue-chip customer base
75% of top 20 customers with 20+ years relationship
Pharma Plastics
53%
Description | ||
Closures | − Solutions for oral solid and oral liquid | |
− Patented active dual chamber systems | ||
Containers | − Full range of containers and jars for oral drug | |
administration | ||
− Complete solutions for ophthalmic treatments | ||
− Products offered in multiple materials (PET, | ||
Accessories & | HDPE, LDPE, PP, PEN, etc.) and in sustainable | |
Dosing Systems | polymers (recycled and bio-based) | |
Type l | ||
Financials
FY24E (€m)
Outlook
~370
Sales
~25%
Near to mid term Adj
EBITDA margin1
~21%
Adj EBITDA Margin
60-70%
Normalized
Cash Conversion2
Moulded
Glass
45%
Converting
3%
− Full range of pharma-grade glass including type | ||
Type ll | I, II and III glass vials and containers | |
− Used for parenteral and oral formulations | ||
Type lll | ||
− Glass vials and containers produced by | ||
Vials | converting flint and amber glass tubing | |
− Used to store and dispense a wide range of | ||
injectables |
Mid Single Digit
Organic revenue CAGR
% 2023A Sales
8 Note: (1) Before synergies of 3-5% of Bormioli Pharma revenues (2) Normalized cash conversion defined as 3yr average of adj EBITDA - Capex as % of adj EBITDA
Truly Complementary Portfolio Completing Solutions Offering to Pharma Customers
PHARMA PLASTICS | GLASS | |||||||||||
Oral | Oral | Dual | Child Proof / | Rubber | Pharma | Food & | ||||||
Ophthalmic | Accessories | Stoppers / | Cosmetics | |||||||||
Solid | Liquid | Chamber | TE Closures | Beverage | ||||||||
Seals | Type I | Type II | Type III | |||||||||
(✓) (✓) | ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ | |
✓ ✓ | ✓ | (✓) ✓ ✓ ✓ |
In Europe
Bormioli Pharma strong in smaller | |
containers and Gerresheimer in | |
Bormioli Pharma strong presence - Gerresheimer limited presence | larger with higher volume |
Gerresheimer strong presence - Bormioli Pharma limited presence |
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Enabling Integrated Solutions Offering Supporting Differentiation and Value Add for Customers
A | |
Gx strong offering of | Bormioli Pharma offering |
EZ-fill Smart™ | in rubber stoppers |
Integrated Vial + Stopper | |
System for Injectables |
B | ||
Gx strong presence | Integrated Primary | Bormioli Pharma |
in bottles and | strong offering in | |
Pharma Plastics System | ||
containers | smart closures |
Primary Plastics Product Database
C | |
Gx strong presence in | Bormioli Pharma strong |
bottles and containers | offering in smart closures |
Integrated Primary Pharma | |
Plastics System |
One Source
- One supplier
- One supply chain
- One contact
- One technical documentation
Complete regulatory support for the integrated solutions
- as the only one
Smooth registration process with all relevant information - just a click away
Supports internal documentation, testing and approval - complete system integration
Full regulatory support with up-to-date information on any product
One Solution
- Qualified system with container closure integrity (CCI)
- Ensured functionality
- Regulatory support and knowledge transfer
- Customized solutions through co-development expertise
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Gerresheimer AG published this content on 23 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 May 2024 02:26:04 UTC.