Q: Can you provide more color on order patterns and inventory levels, particularly in the pharma segment? A: Stephan Tanda, CEO, noted that after a slow Q4 and Q1, there is a re-acceleration into Q2 across various segments. The pharma segment, particularly injectables, is seeing strong demand, although the cold and cough segment still has inventory issues outside the US. The US inventory levels are normalizing due to a strong cold and flu season.
Q: How is the potential for an oral GLP-1 pill affecting your injectables business? A: Stephan Tanda, CEO, explained that the shift to oral GLP-1 is not expected in the short term. Current investments in auto injectors and consumer adaptation are significant, and any transition to oral forms would likely be sequential, with injectables remaining strong in the near future.
Q: What is the impact of tariffs on your business, and how are you managing it? A: Vanessa Kanu, CFO, stated that the net effect of tariffs is expected to be limited. The companys regional supply chain setup helps mitigate tariff impacts, and any increases are passed on to customers. The situation also presents opportunities, as there is increased demand for local production.
Q: Can you discuss the divergence in sales between mass and prestige fragrances? A: Stephan Tanda, CEO, noted that the divergence is due to customer launch decisions and market conditions. Prestige fragrances saw initial growth post-COVID, while mass fragrances are gaining traction now. The company feels confident about its market share and expects prestige fragrance sales to improve, especially in Europe.
Q: How are regulatory changes affecting your long-term growth targets in pharma? A: Stephan Tanda, CEO, mentioned that while regulatory processes can be slow, the long-term growth prospects remain strong. The companys pipeline is robust, and pharma R&D budgets are increasing. The focus remains on chronic disease treatments, which are less affected by short-term regulatory delays.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
