Merck has a good third quarter

Strong organic sales growth impacted by negative exchange rate effects

14-Nov-2018 - Germany

Merck generated very strong organic sales growth in the third quarter of 2018. However, this was impacted by negative exchange rate effects. Despite organic growth, EBITDA pre of the Group also declined in comparison with the year-earlier quarter owing to strong negative foreign exchange effects. Merck confirmed its forecast for the development of organic EBITDA pre for the full year 2018.

“2018 was a challenging year for Merck. We made future-oriented decisions that will lead to profitable growth as of 2019,” said Stefan Oschmann, Chairman of the Executive Board and CEO of Merck. “In the third quarter, we generated strong organic sales growth across all three business sectors. In particular, Healthcare and Life Science performed well, delivering strong organic growth of nearly 10 percent.”

Group sales rose in the third quarter by 6.6% to € 3.7 billion (Q3 2017: € 3.5 billion). Organically, sales grew very strongly by 8.8%. The negative foreign exchange impact of –2.1% was primarily attributable to Latin American currencies such as the Argentinean peso and the Brazilian real.

EBITDA pre, the key financial indicator used to steer operating business, grew organically by 3.7%, thanks mainly to Healthcare and Life Science. However, significant negative foreign exchange effects of –9.5% caused EBITDA pre to decrease by –5.9% to € 963 million (Q3 2017: € 1,023 million). Group EBIT decreased by –43.1% to € 491 million (Q3 2017: € 862 million). Net income of the Merck Group fell in the third quarter by –47.2% to € 340 million (Q3 2017: € 644 million). The considerable declines in EBIT and Group net income are attributable to the gain of € 321 million on the divestment of the Biosimilars business reported in the previous year. Earnings per share pre declined by –7.7% to € 1.32 (Q3 2017: € 1.43)

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