Grifols Accelerates Performance in Q2 and Reaffirms Full Year Guidance

Barcelona, Spain – July 30, 2024 – Grifols (MCE:GRF, MCE:GRF.P, NASDAQ:GRFS), a global healthcare company and leading manufacturer of plasma-derived medicines, today reported solid financial results for the first half of 2024 on the back of a strong second quarter.

Thomas Glanzmann, Executive Chairman, remarked, “We are pleased to have delivered strong quarterly performance and to reaffirm our guidance for the full year 2024. We remain focused on strengthening our governance and executing our strategy, including debt management. The successful closing of the SRAAS deal, as part of the strategic alliance with Haier, serves as a testament to this, and we expect it will also drive opportunities in China’s fast-growing plasma and diagnostics market.”

Nacho Abia, Chief Executive Officer, added, “Thanks to the hard work of the Grifols team, I’m pleased to report that in the second quarter we achieved positive free cash flow, significant sequential EBITDA expansion and near double-digit revenue growth. As we move into the second half of the year, we remain laser-focused on implementing our disciplined approach to operational excellence and cost management to further improve free cash flow generation and deliver sustainable profitability.”

Business Segment Performance

In the first half of 2024, total revenue reached EUR 3,444 million, a year-over-year increase of 7.5% cc, on the back of an accelerated growth in the second quarter of +9.3% cc spread across all Business Units.

Biopharma delivered 8.9% cc growth in the first half of 2024 with an 8.4% growth in the second quarter. The immunoglobulin franchise grew by 13.1% cc in the first six months of the year (+13.7% cc in the quarter), supported by increasing demand in key regions and continued strong adoption of our subcutaneous immunoglobulin, Xembify^®, which surged almost 60% cc in the first half, driven by its performance in the U.S. and its successful commercialization in European countries.

Additionally, albumin revenues grew by 9.6% cc (+11.9% in the quarter) driven by increased demand in China. Alpha-1 and Specialty proteins were flat including the strategic switch of specialty pharma partner in the U.S. during Q2’24 to strengthen the value proposition for Alpha-1 patients for the future.

Diagnostic sales amounted to EUR 322 million in the first half of the year, increasing by 1.9% cc like-for-like² (-3.7% cc reported) and driven by a 1.2% cc uptick in the second quarter on the back of strong Blood Typing Solutions (+14.0% cc) and Immunoassay Donor Screening (+7.6% cc).

Bio Supplies’ revenue increase by 32.6% cc resulting in EUR 110 million for the first half of 2024.

Plasma supply continued to increase in the first half of 2024, while cost per liter (CPL) stabilized in the second quarter following a 2% decline in March 2024 compared to December 2023, which added up to the 22% drop since the peak of July 2022. Overall, outlook for plasma remains positive, with significant opportunities for further cost reductions triggered by current initiatives focused on increasing efficiencies, streamlining operations and digitization.

Financial Performance and Leverage

Adjusted EBITDA for the second quarter of 2024 amounted to EUR 441 million, with a 24.2% margin and a 27.9% growth at constant currency. For the first half of the year, it reached EUR 791 million, achieving a 23.0% margin and a 24.1% growth at constant currency. This performance reflects strong operational execution, cost-per-liter reduction in the second half of 2023, and higher fixed-cost absorption in the first half of 2024.

Reported EBITDA for the second quarter reached EUR 414 million and EUR 724 million in the first half, with margins of 22.8% and 21.0%, respectively. Reported EBITDA for the first half mainly included EUR 44 million of non-recurring transaction and restructuring costs and EUR 22 million from the Biotest Next Level (BNL) project³.

Reported net profit turned positive to EUR 36 million in the first half of 2024 from negative EUR (70) million in the same period last year. Net income excl. one-offs amounted to EUR 152 million.

Free cash flow generation continues to be Grifols’ top priority. Positive free cash flow of EUR 57 million in the second quarter is indicative of the significant sequential improvement expected throughout the year. Working capital improvements, driven by optimized inventory levels, were the largest contributors to the strong free cash flows in the quarter.

Deleveraging remains a key priority for Grifols, and the company made significant progress in the second quarter using the proceeds from the successfully completed SRAAS transaction to lower the company’s leverage ratio to 5.5x.

Net financial debt as per the Credit Facility stood at EUR 8,262 million. This amount does not include the impact of the financial obligations related to leasing, primarily of plasma centers (IFRS 16) – the related impact is EUR 1,134 million as of June 30, 2024. Therefore, net financial debt as per Balance Sheet was EUR 9,396 million.

As of June 30, 2024, and excluding the EUR 1.6 billion net proceeds from the SRAAS transaction, Grifols had a liquidity position of EUR 915 million, with a cash position of EUR 568 million.

FY24 Guidance

Financial Metrics

Note: All figures are consolidated, including Biotest. Leverage ratio definitions as per Credit Facility

Alternative Performance Measures (APMs)

This document contains the following Alternative Performance Measures (APMs): Consolidated EBITDA Reported, Consolidated EBITDA Adjusted, Leverage Ratio as per the Credit Facility, Net Debt as per the Credit Facility, Free Cash Flow, Working Capital, and non-recurring items. For further details on the definition, explanation on the use, and reconciliation of APMs, please see the Appendix of the Presentation as well as the “Alternative Performance Measures” document from our website www.grifols.com/en/investors.