Fourth Quarter 2024
- Net sales of $1.69 billion, decrease of 2%; organic growth of 1%
- Net income of $500.4 million; Adjusted EBITDA of $307.7 million
- Diluted GAAP EPS of $0.73; adjusted EPS of $0.27
- Operating cash flow of $173.3 million; free cash flow of $222.1 million
Full Year 2024
- Net sales of $6.78 billion, decrease of 3%; organic decline of 2%
- Net income of $711.5 million; Adjusted EBITDA of $1,198.8 million
- Diluted GAAP EPS of $1.04; adjusted EPS of $0.99
- Operating cash flow of $840.8 million; free cash flow of $768.3 million
RADNOR, Pa., Feb. 7, 2025 -- Avantor, Inc. (NYSE: AVTR), a leading global provider of mission-critical products and services to customers in the life sciences and advanced technology industries, today reported financial results for its fourth fiscal quarter and year ended December 31, 2024.
"Our fourth quarter results highlight our team's commitment to commercial intensity, operational discipline, and enabling breakthrough therapies. As anticipated, we returned to growth in the fourth quarter and delivered sequential and year-over-year growth in adjusted EBITDA margin, adjusted EPS, and best-in-class free cash flow conversion. We grew our bioprocessing platform high-single-digits and expect continued strength driven by our focused execution and improving end market conditions," said Michael Stubblefield, President and Chief Executive Officer.
"Looking ahead, we're entering the year with strong momentum and a clear focus on innovation-driven revenue growth, margin expansion, and continued deleveraging. Our new operating model is driving greater efficiency, and our cost transformation program is ahead of schedule. With our industry-leading portfolio, resilient supply chain, and relentless efficiency, we are confident in achieving both our near-term and long-term financial goals," Stubblefield concluded.
Fourth Quarter 2024
For the three months ended December 31, 2024, net sales were $1,686.6 million, a decrease of 2% compared to the fourth quarter of 2023. Foreign currency translation and our Clinical Services divestiture had a negative impact, resulting in sales growth of 1% on an organic basis.
Net income increased to $500.4 million from $98.5 million in the fourth quarter of 2023, and adjusted net income was $183.9 million as compared to $166.7 million in the comparable prior period. Net Income margin was 29.7%. Adjusted EBITDA was $307.7 million and Adjusted EBITDA margin was 18.2%. Adjusted Operating Income was $279.4 million and Adjusted Operating Income margin was 16.6%.
Diluted earnings per share on a GAAP basis was $0.73, while adjusted EPS was $0.27.
Operating cash flow was $173.3 million, while free cash flow was $222.1 million.
Full Year 2024
For the full year ended December 31, 2024, net sales were $6,783.6 million, a decrease of 3% compared to 2023. Modest foreign currency translation benefit was offset by our Clinical Services divestiture, resulting in a sales decline of 2% on an organic basis.
Net income increased to $711.5 million from $321.1 million in 2023, and adjusted net income was $677.7 million as compared to $720.1 million in the comparable prior period. Net Income margin was 10.5%. Adjusted EBITDA was $1,198.8 million and Adjusted EBITDA margin was 17.7%. Adjusted Operating Income was $1,089.8 million and Adjusted Operating Income margin was 16.1%.
Diluted earnings per share on a GAAP basis was $1.04, while adjusted EPS was $0.99.
Operating cash flow was $840.8 million, while free cash flow was $768.3 million. Adjusted net leverage was 3.2x as of December 31, 2024.
Fourth Quarter 2024 – Segment Results
Laboratory Solutions
- Net sales were $1,125.8 million, a reported decrease of 5%, as compared to $1,182.4 million in the fourth quarter of 2023. Foreign currency translation and our Clinical Services divestiture had a negative impact resulting in sales decline of 1% on an organic basis.
- Adjusted Operating Income was $147.4 million as compared to $157.3 million in the comparable prior period. Adjusted Operating Income margin was 13.1%.
Bioscience Production
- Net sales were $560.8 million, a reported increase of 4%, as compared to $540.4 million in the fourth quarter of 2023. Sales also increased 4% on an organic basis.
- Adjusted Operating Income was $149.2 million, as compared to $132.0 million in the comparable prior period. Adjusted Operating Income margin was 26.6%.
Full Year 2024 – Segment Results
Laboratory Solutions
- Net sales were $4,610.1 million, a reported decrease of 3%, as compared to $4,738.3 million in 2023. Modest foreign currency translation benefit was offset by our Clinical Services divestiture resulting in sales declines of 2% on an organic basis.
- Adjusted Operating Income was $598.0 million as compared to $668.3 million in the comparable prior period. Adjusted Operating Income margin was 13.0%.
Bioscience Production
- Net sales were $2,173.5 million, a reported decrease of 3%, as compared to $2,228.9 million in 2023. Sales also declined 3% on an organic basis.
- Adjusted Operating Income was $558.2 million, as compared to $601.9 million in the comparable prior period. Adjusted Operating Income margin was 25.7%.
Adjusted Operating Income is Avantor's segment reporting profitability measure under generally accepted accounting principles and is used by management to measure and evaluate the performance of our Company's business segments.
Conference Call
We will host a conference call to discuss our results today, February 7, 2025, at 8:00 a.m. Eastern Time. The live webcast and presentation, as well as a replay, will be available on the investor section of Avantor's website.
About Avantor
Avantor® is a leading life science tools company and global provider of mission-critical products and services to the life sciences and advanced technology industries. We work side-by-side with customers at every step of the scientific journey to enable breakthroughs in medicine, healthcare, and technology. Our portfolio is used in virtually every stage of the most important research, development and production activities at more than 300,000 customer locations in 180 countries. For more information, visit avantorsciences.com and find us on LinkedIn, X (Twitter) and Facebook.
Use of Non-GAAP Financial Measures
To evaluate our performance, we monitor a number of key indicators. As appropriate, we supplement our results of operations determined in accordance with U.S. generally accepted accounting principles ("GAAP") with certain non-GAAP financial measures that we believe are useful to investors, creditors and others in assessing our performance. These measures should not be considered in isolation or as a substitute for reported GAAP results because they may include or exclude certain items as compared to similar GAAP-based measures, and such measures may not be comparable to similarly titled measures reported by other companies. Rather, these measures should be considered as an additional way of viewing aspects of our operations that provide a more complete understanding of our business. We strongly encourage investors to review our consolidated financial statements included in reports filed with the SEC in their entirety and not rely solely on any one single financial measure or communication.
The non-GAAP financial measures used in this press release are sales growth (decline) on an organic basis, Adjusted Operating Income, Adjusted Operating Income margin, Adjusted EBITDA, Adjusted EBITDA margin, adjusted net income, adjusted EPS, adjusted net leverage, free cash flow and free cash flow conversion.
- Organic net sales growth (decline) eliminates from our reported net sales change the impacts of revenues from acquisitions and divestitures that occurred in the last year and changes in foreign currency exchange rates. We believe that this measurement is useful to investors as a way to measure and evaluate our underlying commercial operating performance consistently across our segments and the periods presented. This measure is used by our management for the same reason.
- Adjusted Operating Income is our net income or loss adjusted for the following items: (i) interest expense, (ii) income tax expense, (iii) amortization of acquired intangible assets, (iv) losses on extinguishment of debt, (v) charges associated with the impairment of certain assets, (vi) gain on sale of business, (vii) and certain other adjustments. Adjusted Operating Income margin is Adjusted Operating Income divided by net sales as determined under GAAP. We believe that these measures are useful to investors as ways to analyze the underlying trends in our business consistently across the periods presented. These measures are used by our management for the same reason. Additionally, Adjusted Operating Income is our segment reporting profitability measure under GAAP.
- Adjusted EBITDA is our net income or loss adjusted for the following items: (i) interest expense, (ii) income tax expense, (iii) amortization of acquired intangible assets, (iv) depreciation expense, (v) losses on extinguishment of debt, (vi) charges associated with the impairment of certain assets, (vii) gain on sale of business, (viii) and certain other adjustments. Adjusted EBITDA margin is Adjusted EBITDA divided by net sales as determined under GAAP. We believe that these measures are useful to investors as ways to analyze the underlying trends in our business consistently across the periods presented. These measures are used by our management for the same reason.
- Adjusted net income is our net income or loss first adjusted for the following items: (i) amortization of acquired intangible assets, (ii) losses on extinguishment of debt, (iii) charges associated with the impairment of certain assets, (iv) gain on sale of business, (v) and certain other adjustments. From this amount, we then add or subtract an assumed incremental income tax impact on the above-noted pre-tax adjustments, using estimated tax rates, to arrive at Adjusted Net Income. We believe that this measure is useful to investors as a way to analyze the business consistently across the periods presented. This measure is used by our management for the same reason.
- Adjusted EPS is our adjusted net income divided by our diluted GAAP weighted average share count adjusted for anti-dilutive instruments. We believe that this measure is useful to investors as an additional way to analyze the underlying trends in our business consistently across the periods presented. This measure is used by our management for the same reason.
- Adjusted net leverage is equal to our gross debt, reduced by our cash and cash equivalents, divided by our trailing 12-month Adjusted EBITDA (excluding stock-based compensation expense and including the expected run-rate effect of cost synergies and the incremental results of completed acquisitions and divestitures as if those acquisitions and divestitures had occurred on the first day of the trailing 12-month period). We believe that this measure is useful to investors as a way to evaluate and measure the Company's capital allocation strategies and the underlying trends in the business. This measure is used by our management for the same reason.
- Free cash flow is equal to our cash flows from operating activities, less capital expenditures, plus direct transaction costs and income taxes paid related to acquisitions and divestitures (as applicable) in the period. Free cash flow conversion is free cash flow divided by adjusted net income. We believe that these measures are useful to investors as they provide a view on the Company's ability to generate cash for use in financing or investing activities. These measures are used by our management for the same reason.
Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the tables accompanying this release.
Forward-Looking and Cautionary Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and are subject to the safe harbor created thereby under the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this press release are forward-looking statements. Forward-looking statements discuss our current expectations and projections relating to our financial condition, results of operations, plans, including our cost transformation initiative, objectives, future performance and business. These statements may be preceded by, followed by or include the words "aim," "anticipate," "assumption," "believe," "continue," "estimate," "expect," "forecast," "goal," "guidance," "intend," "likely," "long-term," "near-term," "objective," "opportunity," "outlook," "plan," "potential," "project," "projection," "prospects," "seek," "target," "trend," "can," "could," "may," "should," "would," "will," the negatives thereof and other words and terms of similar meaning.
Forward-looking statements are inherently subject to risks, uncertainties and assumptions; they are not guarantees of performance. You should not place undue reliance on these statements. We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that our assumptions made in connection with the forward-looking statements are reasonable, we cannot assure you that the assumptions and expectations will prove to be correct. Factors that could contribute to these risks, uncertainties and assumptions include, but are not limited to, the factors described in "Risk Factors" in our most recent Annual Report on Form 10-K, and subsequent quarterly reports on Form 10-Q, as such risk factors may be updated from time to time in our periodic filings with the SEC.
All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements. In addition, all forward-looking statements speak only as of the date of this press release. We undertake no obligations to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise other than as required under the federal securities laws.
Investor Relations Contact
Allison Hosak
Senior Vice President, Global Communications
Avantor
908.329.7281
Allison.Hosak@avantorsciences.com
Global
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