Lonza Reports Record First Quarter

April 26,2016

•  Business performance above target – positive start to 2016 with a good momentum continuing into the second quarter

•  Double-digit CORE EBIT growth expected for first half of 2016

•  Pharma&Biotech with further uptake in demand and strong operational performance

•  Specialty Ingredients with strong results through ongoing progress in portfolio management

•  Continued progress in deleveraging the company

Basel, Switzerland, 26 April 2016 – During the first quarter of 2016, Lonza recorded its strongest first quarter in history in terms of sales and earnings. The healthy overall company performance resulted from good results in both the Specialty Ingredients and the Pharma&Biotech segments.

“These record-level results in the first quarter show that the strict market focus of our organization is producing results. The ongoing improvement projects that emphasize organic growth, stringent portfolio management and operational excellence are proving to be successful,” said Richard Ridinger, CEO of Lonza. “We will use this positive start to the year to drive further our transformation initiatives with the goal of further strengthening our position as a leading supplier to the pharmaceutical, biotech and our different specialty ingredients markets.”

Pharma&Biotech Segment

The Pharma&Biotech segment’s sales growth was driven by robust demand in Mammalian Manufacturing, Clinical Development and Emerging Technologies. The higher-than-expected growth in Emerging Technologies came specifically through contributions from cell and viral therapy applications. The significant earnings improvement was a result of the strong operational performance and ongoing cost discipline.

The strong momentum in Biologics translates into a promising pipeline going forward. Lonza plans further “brown-field expansion” projects to meet high demand.  

Our healthy Bioscience Solutions business showed further improvement compared with the previous year, driven by product introductions and sound demand in all sub-segments.

Specialty Ingredients Segment

Lonza’s Specialty Ingredients segment delivered robust results throughout all markets in the first quarter through ongoing progress in portfolio management to focus on higher-value activities.

Consumer Care growth was driven by ongoing demand in the Hygiene business. Integration of innovative solutions such as L-Carnitine applications in Nutrition and vitamin B3 solutions for cosmetic applications are further accelerating demand.

In Agro Ingredients Lonza experienced better sales than expected in the first quarter while softer demand is anticipated for the remainder of the year.

Coatings & Composites reported stable demand and good performance across all relevant markets.

Water Treatment’s business in the first quarter was on track for the residential business while Industrial, Commercial, Municipal and Surface Water delivered a good performance overall.

Outlook 2016

With this positive start into 2016 and the good momentum already continuing into the second quarter, we expect double-digit CORE EBIT growth for first half of 2016. The record-setting performance of the company led to a healthy balance sheet in the first quarter and will support the continued deleveraging of the company.

The full-year guidance 2016 will be reviewed as part of the H1 2016 results reporting on 20 July 2016.

A Capital Markets Day for investors and analysts will be held in Portsmouth, NH (USA) on 27 October 2016.

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