Demand for life science ingredients products improved compared with 2009. Increasing margin pressure in some areas was more than offset by volume growth.
Visibility improved thanks to firmly placed orders and new contracts signed in custom manufacturing. Overall, new contracts and orders were at a considerably higher level than a year ago, driving stronger business growth in the second half of the year and through 2011.
Increased capacity utilisation in large-scale biological manufacturing is a consequence of firm order placements since March 2010. However, de-stocking in custom manufacturing continued in the first half, and volatility is expected to continue, especially for the small-scale business.
Bioscience overall is on track; the decline in sales is due to the expected under-utilisation in therapeutic cell solutions. Demand from academia and industry has improved but isn’t yet fully recovered, with companies still reducing R&D budgets.
In an environment of ongoing market volatility and macro-economic uncertainties, the company is able to stabilise the business. Lonza’s life science strategy will continue to deliver long-term growth through an increased project pipeline, new signed contracts and an intact outsourcing trend, and investments in plants and technologies.
Lonza will continue to generate new business which will improve the profitability of our assets and strengthens our cash flow generation.
Source: Lonza
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