Performance for the period (unaudited)
(Comparative figures for 2015 are shown in brackets. Revenue growth is measured as organic growth in local currencies. Revenue from ALK's base business is defined as total revenue excluding income from the SLIT-tablet partnerships in North America and International markets).
ALK continued to record double-digit sales growth in Europe in Q3. European sales and order intake exceeded expectations, driven by strong double-digit growth for SLIT-tablets and SLIT-drops. Overall margins softened following an expected decline of DKK 108 million in one-off milestone payments.
- Q3 total revenue, including partner income, amounted to DKK 630 million (667). Revenue in Q3 2015 included a DKK 112 million one-off milestone payment.
- Q3 revenue in the base business grew organically by 17% to DKK 614 million (534).
- ALK’s base business saw strong sales growth for SLIT-tablets and SLIT-drops, while SCIT sales declined due to upgrade work on SCIT production in Europe, which has temporarily reduced SCIT production capacity.
- To meet demand during the forthcoming peak season, ALK will hire additional employees, primarily at the SLIT-drops production site in France. At the same time, ALK is expanding its North American organisation in support of the ongoing repatriation of the SLIT-tablets from MSD (known as Merck in the USA and Canada).
- ACARIZAX® is performing well during its introductory phase, consolidating its position in Denmark and Germany as the most prescribed product for new AIT initiations in adult patients with house dust mite allergy. ACARIZAX® was also recently launched in Slovakia, Sweden and Finland.
- Q3 operating profit (EBITDA) was DKK 121 million before special items (171). The EBITDA margin was 19% before special items (26%) as improved underlying profitability was offset by lower milestone payments.
- 9M total revenue was DKK 2,251 million (1,882) reflecting 30% growth in the base business. EBITDA before special items was DKK 584 million (329) and free cash flow was an inflow of DKK 198 million (an outflow of 149).
Updated 2016 financial guidance
ALK is updating its full-year guidance to reflect continued high orders in France which, from a revenue perspective, outweigh the impact of the upgrade work on SCIT production.
- Total full-year revenue is still projected to exceed DKK 2.9 billion including income from partnerships.
- Full-year revenue in the base business is now expected to grow organically by more than 20% versus previous guidance of ~20% growth.
- The new revenue guidance assumes that growth in the base business will be constrained by the ongoing upgrade of SCIT production which is estimated to reduce revenue by DKK 100-125 million, impacting the last four months of the year. Hence, the new guidance assumes low organic growth in the base business in Q4 2016 and a minor contribution from partnerships. Comparison with Q4 2015 is further affected by last year’s significant sales growth resulting from a competitor’s supply issues.
- Full-year EBITDA is now expected to exceed DKK 650 million before special items. Previous guidance stated >DKK 600 million.
- Free cash flow is now expected at DKK 100-150 million versus previous guidance of DKK 50-100 million.
Hørsholm, 10 November 2016
For further information, contact:
Investor Relations: Per Plotnikof, tel. +45 4574 7527, mobile +45 2261 2525
Media: Jeppe Ilkjær, tel. +45 7877 4532, mobile +45 3050 2014
Today, ALK is hosting a conference call for analysts and investors at 12.00 p.m. (CET) at which Management will review the financial results and the outlook. The conference call will be audio cast on www.alk-abello.com/investor. Participants in the audio cast are kindly requested to call in before 11.55 a.m. (CET). Danish participants should call in on tel. +45 7022 3500 and international participants should call in on tel. +44 (0) 20 7572 1187 or +1 646 722 4972. Please use the Participant Pin Code: 38708515#. The conference call will also be webcast live on our website, where the related presentation will be made available shortly before the call begins.