Sandoz Group (SDZ) Q4 2025 earnings summary

Executive summary

• Net sales reached $11.1 billion in FY 2025, up 5% at constant currencies and 7% in USD, with biosimilars now 30% of total sales and 17 consecutive quarters of growth.

• Core EBITDA margin expanded to 21.7%, with core EBITDA rising 14–16% to $2.4 billion, and return on invested capital up to 14.5%.

• Core diluted EPS grew 33–34% to $3.64, driven by higher operating profit, lower financial expenses, and a reduced tax rate.

• Major biosimilar launches included Pyzchiva, Afqlir, Wyost, Jubbonti, and Tyruko in key markets, with a record number of launches in Europe.

• Expanded biosimilar capabilities through acquisition of Just-Evotec Biologics EU SAS and new facilities in Slovenia.

Financial highlights

• Net sales surpassed $11 billion, with biosimilars growing 13–15% at constant currency and generics up 2%.

• Core EBITDA increased to $2.4 billion, margin at 21.7%, and free cash flow rose to $1.5–1.55 billion.

• Core ROIC improved to 14.5%, and core EPS rose 33–34%.

• Net debt to core EBITDA ratio improved to 1.5x, with liquidity up to $1.8 billion.

• Dividend per share proposed to increase by one-third to CHF 0.80.

Outlook and guidance

• 2026 net sales expected to grow mid to high single digits at constant currencies, with core EBITDA margin targeted to increase by ~100 basis points.

• Price erosion anticipated at low to mid single digits; adverse penicillin B2B dynamics and US tariffs to persist in H1 2026.

• CapEx for 2026 projected at $1.1 billion, focused on biosimilar capabilities.

• Midterm outlook for 2028 remains unchanged, with strong momentum from recent launches and dividend payout ratio targeted at 30–40%.

• 2026 guidance excludes potential generic semaglutide launch and new US tariffs.