Lonza Group AG

Lonza reported H1 2026 sales of CHF 3.4 billion, representing 16% CER sales growth versus H1 2025. CORE EBITDA was CHF 1.2 billion, with a CORE EBITDA margin of 34.8%, up 4.4 percentage points year over year; in actual exchange rates, sales grew 11.2%, with FX creating almost a five-point headwind. Free cash flow improved to CHF 426 million from CHF 116 million in H1 2025, CapEx totaled CHF 530 million (15.7% of sales), and ROIC increased to 13.2% from H1 2025. By segment, Integrated Biologics posted CHF 1.87 billion of sales and a 36% margin, Advanced Synthesis had CHF 834 million of sales and a 48.1% margin, and Specialized Modalities had CHF 553 million of sales and a 28% margin. For full-year 2026, management lifted CORE EBITDA margin guidance to 33%-34% from above 32% previously and reaffirmed 11%-12% CER sales growth; FX impact for the year is expected to be minus 2 to minus 3 percentage points.

Wolfgang Wienand emphasized that H1 performance was strong across all three platforms and broadly ahead of or in line with expectations, driven by robust customer demand, deep relationships, and disciplined execution. He framed the results as evidence that the One Lonza strategy is working, highlighting the shift to a pure-play CDMO, the end-to-end value of the company’s offering, and a clear line of sight to sustained low-teens organic CER growth over time. His tone was confident and focused on visibility, discipline, and long-term value creation.

Philippe explained that H1 sales and growth were entirely organic, unlike H1 2025, which included Vacaville acquisition contribution, and that FX was a meaningful headwind in the first half. He detailed the margin drivers as operational execution, maturing growth projects, operating leverage, favorable mix, and phasing, and said ROIC improved to 13.2%; free cash flow rose to CHF 426 million and CapEx fell to CHF 530 million, or 15.7% of sales, versus 21.2% last year. He also said working capital at 37.9% of sales was elevated by growth-related receivables and should be temporary, while CapEx intensity should remain in the mid-to-high teens of sales.

Analysts focused on CapEx phasing, the apparent H2 revenue slowdown, and whether the strong H1 growth and margins were partly timing-related. Management said CapEx is inherently lumpy, that investment should be viewed in a mid-to-high-teens-of-sales corridor, and that the Stein scope change only adds small extra CapEx but delays startup. On revenue and margins, they said visibility is very good, H2 growth will normalize against tougher comps and phasing, and the full-year outlook still fits the company’s organic growth model; they also clarified that SPM’s improvement reflects Microbial and Cell & Gene recovery, while 483 observations have not affected operations or revenue.