New Grifols CEO sets long-term plans for group’s business ahead of Brookfield | Companies
Grifols presented its financials for the first nine months of the year this Thursday. Results eagerly awaited by the market after a stock market meltdown caused by embarrassment allegations from bearish firm Gotham City Research and anticipation of a possible takeover bid from Brookfield and other members of the founding family. The pharmaceutical company saw revenue increase by more than 9% in the January-September period, making 88 million euros in profit after red 2023 figures and reducing debt. But beyond that, CEO Nacho Abia, who took over full group executive powers after Thomas Glanzmann became non-executive chairman of the board, defended the good development of the business and told investors and analysts the company was “setting the course for long-term success.”
IN conference call Following the earnings presentation, Abia highlighted Grifols’ “solid fundamentals”, strong underlying demand in the US and European Union (EU) plasma industry, the company’s acceleration in R&D projects aimed at strengthening product offerings, launching new indications and products to market, strengthening executive management with the arrival of new CFO Rahul Srinivasan, as well as a reaffirmation of “a strong commitment to cash flow generation and deleveraging priorities.”
The manager said the company is accelerating performance and executing on strategy, citing third-quarter revenue growth of 12.4%, with “significant progress across all business units and core markets,” with higher margins driven by product mix, lower cost-of-book and operational multiplier effect.
At the same time, Abia outlined the evolution of the various business lines, noting Biopharma’s 12% growth to €1.532 million (85% of the group), with immunoglobin sales up 16.6% in the third quarter driven by strong demand in the US and EU. as well as recent launches. Albumin grew 11.7% with stronger demand in China and competitive dynamics across markets, and Alpha-1 and specialty proteins grew 3.8% with Alpha-1 accelerating its recovery following the pharmaceutical specialty distributor’s move to the U.S. and increased demand for hyperimmune anti-rabies drugs on the US market.
In addition, he pointed to the operational and efficiency improvements achieved at Biopharma during this period. On the one hand, he defended the commercial momentum, strengthening the product offering (he most notably cited Xembify’s acceleration with eight launches in the EU in 2024), the US momentum and the EU’s robust growth, as well as management life. cycle and development of new products. In terms of improving operational efficiency, Abia stressed that investments will continue to grow, opening 405 plasma therapy centers in the United States, Europe, Canada and Egypt; leveraging new technologies and process efficiencies to further expand market share, and maximizing IG productivity through the implementation of nomograms and manufacturing processes.
Abia said the company is on track to achieve biopharma innovation goals by 2024, highlighting the good evolution of the GigaGen platform in the US. The manager recalled a contract to develop recombinant polyclonal therapy for two target proteins worth $1,000. 135 million dollars (about 122 million euros) over six years.
Regarding the diagnostic business, Abiy assured that Grifols is strengthening its leadership in transfusion medicine. Regarding blood typing solutions, where the group is registering double-digit growth in key countries, he spoke of a growing business where the company aims to become a leader, where it will execute on the commercial plan, presence in key markets will be strengthened and profitability will continue to improve.
In terms of donor valuation, he said it is a stabilized business poised for continued growth and in which it has near-term leverage, including maintaining strategic accounts and developing a new molecular platform for blood and plasma screening. U.S. blood donation volume remained stable in the third quarter, driven by progress in the tissue and organ testing market and securing tenders in expanding markets, the manager said.
The publication of the reports, together with the expectation of a takeover offer, contributed to the recovery of Grifols shares on the stock market this Friday, which closed up 4.36% to 11.13 euros. The company, whose shares have fallen 27% since the start of the year due to the Gotham affair, is currently capitalized at €7.087 million.