Ad hoc announcement pursuant to Article 53 of the SIX Exchange Regulation Listing Rules

Financial results for the first half of 2021 


   -- Order entry increased to CHF 449.6 million (H1 2020: CHF 374.0 million) 
 
          -- Increase of 20.9% in local currencies or 20.2% in Swiss francs 
   -- Sales of CHF 454.0 million (H1 2020: CHF 310.0 million) 
 
          -- Growth of 47.5% in local currencies or 46.5% in Swiss francs 
 
          -- Both business segments with similar growth rates 
   -- Reported operating profit before depreciation and amortization (EBITDA) 
      of CHF 115.0 million (H1 2020: CHF 60.2 million) 
 
          -- Reported EBITDA margin of 25.3% (H1 2020: 19.4%) 
 
   -- Reported net profit of CHF 82.6 million (H1 2020: CHF 36.0 million) 
 
          -- Reported earnings per share increased by 127.8% to CHF 6.88 (H1 
             2020: CHF 3.02) 
 
   -- Outlook for organic full-year sales and reported EBITDA margin raised

Operating highlights in the first half of 2021 


   -- Launch of new variants of the Fluent(R) Automation Workstation to solve 
      specific needs in key research and diagnostic applications 
 
   -- Introduced important new reagent and digital offerings 
 
   -- Tecan one of the first companies to meet the new requirements of the 
      European Union's In Vitro Diagnostic Regulation (IVDR), successfully 
      completing first product certification 
 
   -- Tecan ranked among Switzerland's Best Large Workplaces(TM) by Great Place 
      to Work(R) Switzerland 
 
   -- Tecan expands its commercial reach, its capabilities and its US and Asia 
      presence with the acquisition of Paramit Corporation (completed on August 
      2, 2021)

Männedorf, Switzerland, August 18, 2021 -- The Tecan Group (SIX Swiss Exchange: TECN) posted a substantial double-digit increase in sales and more than a doubling in net profit in the first half of 2021. This builds on an already strong performance in the prior-year period.

Tecan CEO Dr. Achim von Leoprechting commented: "Tecan achieved outstanding sales and profit growth in the first half of the year, and I am incredibly proud of our employees, who support our customers with great commitment and passion. We still saw a strong sales contribution from product lines helping with the global response to COVID-19. However, in terms of order entry, this was outpaced by demand for products for other research and clinical applications. In particular, we are seeing strong momentum in automation systems as customers -- in a reaction to the pandemic -- seem to be placing more emphasis on keeping labs operational also in a hybrid working model with fewer personnel. This new aspect complements productivity and reproducibility, the traditional main advantages and value propositions of automation.

With the acquisition of Paramit Corporation successfully closed early August 2021, we look forward to working alongside our new colleagues at Paramit to scale innovation from research and diagnostics now all the way to the clinic."

Financial results for the first half of 2021

Order entry increased by 20.9% in local currencies or 20.2% in Swiss francs to CHF 449.6 million in the first six months of the year (H1 2020: CHF 374.0 million). The company continued to see strong order entry for consumables to support the global fight against the coronavirus pandemic and, as expected, to a lesser extent for new instruments used for COVID-19 testing. In contrast to the two previous 6-month reporting periods, orders for products for other research and clinical applications were at a significantly higher level and exceeded pandemic-related orders.

Sales climbed by 47.5% in local currencies or 46.5% in Swiss francs to CHF 454.0 million in the first half of the year (H1 2020: CHF 310.0 million). Based on the high order backlog at year-end 2020 and new orders, Tecan continued to book significant pandemic-related sales for instruments, components and consumables. As with order entry, sales in the first half of 2021 also benefited significantly from a recovery and a more positive market environment in areas that were negatively impacted by the pandemic, such as life science research, pharma and non-COVID-19 diagnostic testing. Both business segments contributed almost equally to the overall sales growth in the first six months of the year.

Recurring sales of services, consumables and reagents increased in the first half of 2021 by 37.6% in local currencies and 35.4% in Swiss francs. With even higher growth rates for instruments, recurring sales accounted for 43.1% of total sales compared to 46.6% in the same period last year.

The reported operating profit before depreciation and amortization (earnings before interest, taxes, depreciation and amortization; EBITDA) rose to CHF 115.0 million in the reporting period (H1 2020: CHF 60.2 million). With an increase of 91.1%, reported EBITDA grew significantly faster than sales, mainly driven by benefits of scale due to the significantly increased volumes and a favorable product mix of instruments as well as a higher contribution from consumables and spare parts. The results development was also helped by a one-time positive effect from an adjustment of the Swiss pension plan (CHF 7.0 million). However, the company is assessing alternative pension schemes that could require a reversal of this gain in the second half of the year.

The reported EBITDA margin grew correspondingly by 590 basis points to 25.3% of sales (H1 2020: 19.4%).

Reported net profit in the first half of 2021 more than doubled to CHF 82.6 million (H1 2020: CHF 36.0 million). Reported net profit increased in line with operating profit (earnings before interest and taxes; EBIT). The reported net profit margin amounted to 18.2% of sales (H1 2020: 11.6%), while basic earnings per share rose to CHF 6.88 (H1 2020: CHF 3.02).

Cash flow from operating activities increased by 34.5% to CHF 111.4 million in the first half of 2021 (H1 2020: CHF 82.8 million), corresponding to 24.5% of sales (H1 2020: 26.7%).

Information by business segment

Life Sciences Business (end-customer business)

Sales in the Life Sciences Business increased by 47.8% to CHF 250.4 million (H1 2020: CHF 169.4 million) in the first half of the year and were 49.5% above the prior-year period in local currencies. Based on the high order backlog at year-end 2020, the Life Sciences Business continued to see a strong revenue contribution from products supporting the COVID-19 response, mainly liquid handling and automation workstations and associated disposable pipette tips. Segment sales in the first half of 2021 also benefited significantly from a recovery in areas that were negatively impacted by the pandemic, including liquid handling and automation workstations for various life science research applications, detection instruments and research reagents for next-generation sequencing (NGS).

Order entry in the Life Sciences Business grew with a strong double-digit rate in the first half of the year. The increase in order entry was mainly driven by strong momentum in automation systems for a wide variety of applications, detection instruments as well as continued substantial demand for consumables used for COVID-19 testing.

Reported operating profit in this segment (earnings before interest and taxes; EBIT) rose by 180.9% to CHF 63.1 million (H1 2020: CHF 22.5 million). The operating profit margin increased to 22.8% of sales (H1 2020: 12.6%). This positive performance is primarily a result of sales growth as well as a strong margin contribution from the consumables business.

Partnering Business (OEM business)

The Partnering Business generated sales of CHF 203.7 million in the period under review (H1 2020: CHF 140.6 million), which corresponds to an increase of 44.8% in Swiss francs and 45.1% in local currencies. Similar patterns to the Life Sciences Business were observed in the Partnering Business, with automation platforms, OEM components and disposable pipette tips supporting COVID-19 testing contributing strongly to sales as orders were converted from the high backlog into sales. Sales to customers in other areas of in-vitro diagnostics, which were negatively affected during the pandemic, also showed positive momentum again.

With the shift in order entry from COVID-driven applications to non-infectious disease customers, order entry in the Partnering Business also grew at a strong double-digit rate.

Operating profit in this segment (earnings before interest and taxes; EBIT) increased by 86.9% to CHF 49.2 million (H1 2020: CHF 26.3 million), while the operating profit margin grew to 24.0% of sales (H1 2020: 18.6%). Main drivers for the increase in profitability were benefits of scale due to the significantly higher volumes and a favorable product mix.

Additional information

Regional development

In Europe, Tecan's sales in the first six months of 2021 increased by 36.1% in local currencies and by 38.3% in Swiss francs. Both business segments grew with a double-digit rate, the Partnering Business with 13.4% in local currencies and the Life Sciences Business with 59.0%.

In North America, sales rose by 69.4% in local currencies and by 62.0% in Swiss francs. The Life Sciences Business increased sales in the first six months of 2021 by 61.1% in local currencies. In the Partnering Business sales rose by 80.8%, despite the high comparative basis from the prior-year period.

In Asia, Tecan generated an increase in sales of 30.9% in local currencies and 33.7% in Swiss francs. Both segments contributed to the sales growth in the region with double-digit rates, the Life Sciences Business with growth in local currencies of 8.6% and the Partnering Business with 59.7%. In the first half of this year, the Chinese market environment returned to normal levels. Business in China had already benefited significantly from pandemic-related sales growth in the prior-year period. Tecan continued to record solid sales growth in the first half of 2021, although this was lower than in the Asia region as a whole due to the high comparison base.

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August 18, 2021 00:30 ET (04:30 GMT)