Galderma Delivers Record Net Sales of 2.2 Billion USD and 10.8% Year-on-Year Growth at Constant Currency for the First Half of 2024--中企资讯网

	9		(569)
Gross profit		1,549		-	89	9	1,647	74.8%
Research and development		(135)		-	-	1	(134)	6.1%
Sales and marketing		(701)		-	-	5	(695)	31.6%
General and administrative		(287)		57	22	15	(194)	8.8%
Medical and regulatory		(45)		-	-	-	(45)	2.0%
Distribution		(65)		-	-	1	(65)	2.9%
Other income / (expenses)		(2)		2	-	-	-	-
Operating profit as reported		313
Total adjustments				59	112	30
Core EBITDA							514	23.4%

Reconciliation of H1 2024 of Core EBITDA to IFRS Net Income

In million USD	H1 2023	H1 2024
Core EBITDA	450	514
% margin	22.5%	23.4%
Exceptional and transformation related adjustments	(23)	(57)
Other income / (expenses)	(18)	(2)
Total EBITDA adjustments5	(40)	(59)
EBITDA	410	455
% margin	20.5%	20.7%
Depreciation	(25)	(30)
Amortization	(107)	(112)
Operating profit	278	313
Net interest expenses incl. VCB revaluation	(278)	(206)
Foreign exchange loss on financing activities	(18)	(30)
Income / (loss) before tax	(17)	77
Income taxes	21	(30)
Net income	4	47

Reconciliation of H1 2024 from IFRS Net Income to Core Net Income6

In million USD	H1 2023	H1 2024
Net income	4	47
Total EBITDA adjustments5	40	59
VCB financing revaluation	(19)	(28)
Amortization	107	112
Foreign exchange loss on financing activities	18	30
Income taxes on above items	(18)	(10)
Core Net Income	131	210

H1 2024 Total Net Indebtedness

In million USD	Dec 31 2023	June 30 2024
Total Indebtedness7	5,001	2,974
Cash and Cash Equivalents	(368)	(385)
Total Net Indebtedness	4,633	2,589

Latest additional modeling metrics for full year 2024

	Modelling metrics at IPO	Latest modelling metrics
Transformation costs8	~30 million USD	Slightly below 30 million USD
Milestone and earnouts9	~175 million USD	~175 million USD
Core CAPEX10	3-4% of net sales	3-4% of net sales
Effective tax rate	~27%	~30%, with the 2024 tax rate impacted by one-off IPO items
Leverage	2.25 – 2.50x11	Towards the lower end of 2.25 – 2.50x11
Interest (post IPO expected Run Rate)	~8.5%12 average interest rate; ~250 M USD interest expense	~120 M USD in interest cash expenses in H2, corresponding to ~50 bps improvement of the yearly interest run-rate13 on gross debt as of H2

Notes and references

Constant currency year-on-year growth is defined as the annual growth rate of net sales excluding the impact of exchange rates movements and excluding hyperinflation economies. The impact of changes in foreign exchange rates are excluded by translating all reported revenues during the two periods at average exchange rates in effect during the previous year.
Core EBITDA is defined as EBITDA excluding the following items that are deemed exceptional, including acquisition and disposal, integration and carve-out related income and expenses, onerous contracts, business disposal gains and losses, restructuring and reorganization related items, litigation related items, impairment of PPE and software, IPO related incentive plans as well as other income and expense items that management deems exceptional and that are expected to accumulate within the year to be over 1 M USD threshold. These include transformation, carve-out and build-up related project costs as well as post-acquisition related accounting impacts
Leverage is defined as Total Net Indebtedness divided by Core EBITDA on a twelve-months rolling basis
https://academic.oup.com/asj/advance-article/doi/10.1093/asj/sjae131/7697878?utm_source=advanceaccess&utm_campaign=asj&utm_medium=email&login=true
2023 EBITDA adjustments include 13 million USD for platform transformation costs, 10 million USD for VCB bonus, 11 million USD litigation and onerous items, 3 million USD for IPO, 1 million USD for operating FX, 3 million USD on Restructuring and Others. 2024 adjustments include 48 million USD for IPO related incentive plans, 5 million USD for platform transformation costs, 4 million USD for VCB bonus, 2 million USD for IPO
Core Net Income is defined as net income / (loss) from continuing operations adjusted for the same items that are treated as exceptional for purposes of defining Core EBITDA, as well as amortization of intangible assets, foreign exchange gains and losses on financing activities. Taxes on the adjustments between IFRS net income and Core Net Income take into account, for each individual item included in the adjustment, the tax rate that will finally be applicable to the item based on the jurisdiction where the adjustment will finally have a tax impact
Indebtedness includes financial debt and lease liabilities
In addition, assuming ~20 M ''other income & expenses'', e.g., litigation and onerous items, excluding 48 M USD costs in relation to the ‘IPO Incentive Plans’ and the ‘IPO Cash Bonus’ described in the Offering prospectus, recognized at fair value, 38 M of which were settled non-cash, in restricted existing shares funded and delivered by the Selling Shareholders upon completion of the offering. The ‘IPO Incentive Plans’ were inversely related to the final offer price, i.e., the higher the final offer price, the lower the amount of the awards under the ‘IPO Incentive Plans’. The purpose of the ‘IPO Incentive Plans’ was to align the interests of the members of the Board of Directors and the Executive Committee, management and selected employees of the Group with the interests of the new shareholders at the time of the offering by limiting the impact of the final offer price on the amount of the awards payable to the Board of Directors and the Executive Committee, management and selected employees of the Group as a result of the completion of the offering
Year-end metric, relates to nemolizumab, Alastin and other products
Core CAPEX is defined as the capital expenditures (Property, plant and equipment as well as Intangible assets) excluding transformation related investments and acquisitions of IP and operating rights
Based on 2024 expected Core EBITDA. Includes ~175 M USD milestones and earnouts
Based on 3M SOFR + 2.75% subject to hedging strategy
Based on 3M SOFR + 2.25% subject to hedging strategy

Forward-looking statements

Certain statements in this announcement are forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as "plans", "targets", "aims", " believes", "expects", "anticipates", "intends", "estimates", "will", "may", "continues", "should" and similar expressions. These forward-looking statements reflect, at the time, Galderma''s beliefs, intentions and current targets/ aims concerning, among other things, Galderma''s results of operations, financial condition, industry, liquidity, prospects, growth and strategies and are subject to change. The estimated financial information is based on management''s current expectations and is subject to change. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial consequences of the plans and events described herein. Actual results may differ from those set forth in the forward-looking statements as a result of various factors (including, but not limited to, future global economic conditions, changed market conditions, intense competition in the markets in which Galderma operates, costs of compliance with applicable laws, regulations and standards, diverse political, legal, economic and other conditions affecting Galderma’s markets, and other factors beyond the control of Galderma). Neither Galderma nor any of their respective shareholders (as applicable), directors, officers, employees, advisors, or any other person is under any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance on forward-looking statements, which speak of the date of this announcement. Statements contained in this announcement regarding past trends or events should not be taken as a representation that such trends or events will continue in the future. Some of the information presented herein is based on statements by third parties, and no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, reasonableness, accuracy, completeness or correctness of this information or any other information or opinions contained herein, for any purpose whatsoever. Except as required by applicable law, Galderma has no intention or obligation to update, keep updated or revise this announcement or any parts thereof.

About Galderma

Galderma (SIX: GALD) is the pure-play dermatology category leader, present in approximately 90 countries. We deliver an innovative, science-based portfolio of premium brands and services that span the full spectrum of the fast-growing dermatology market through Injectable Aesthetics, Dermatological Skincare and Therapeutic Dermatology. Since our foundation in 1981, we have dedicated our focus and passion to the human body’s largest organ – the skin – meeting individual consumer and patient needs with superior outcomes in partnership with healthcare professionals. Because we understand that the skin we are in shapes our lives, we are advancing dermatology for every skin story. Galderma’s portfolio of flagship brands includes Restylane, Dysport, Azzalure, Alluzience and Sculptra in Injectable Aesthetics; Cetaphil and Alastin in Dermatological Skincare; and Soolantra, Epiduo, Differin, Aklief, Epsolay, Twyneo, Oracea, Metvix, Benzac and Loceryl in Therapeutic Dermatology. For more information: www.galderma.com.

Contacts