CTLT - Earnings call transcript Q4 2022

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Operator

Good morning. Thank you for attending today's Catalent, Inc. Fourth Quarter Fiscal Year 2022 Earnings Call. My name is Forum, and I will be your moderator for today's call. All lines will remain muted during the presentation portion of the call with an opportunity for public and private questions and answers at the end. now host, to of Paul is over the Investor It our to Surdez, Instructions] my pass pleasure conference Relations. [Operator Vice President Mr. proceed. please Surdez,

Paul Surdez

Good financial results. today joining quarter morning you full review and XXXX Catalent's fourth everyone us year fiscal thank and to for

and the Officer. Officer; is Please on agenda today's Castellano, me see Chief on Maselli, Slide and and Investor Relations our investor.catalent.com. call our on which today our available call Joining Senior supplemental X Alessandro VP are President at Executive Tom Financial presentation, of Chief for website

our reconciliations on statements today refer release It We results today, non-GAAP statements. X Form and to most just-issued forward-looking that differ During SEC the performance use will provides is call refer comparable our measures. on condition. expectations. detail that the management on and management's you may refer XX-K to and will Slides non-GAAP X also bear measures. to operating could forward-looking Catalent's financial and financial our Catalent's results measures risks GAAP for information the uncertainties from and discuss additional with make Slide possible Please X of filed actual that more financial earnings directly be to for

turn Maselli, call begin Alessandro the Now will I would like to opening whose of the presentation. remarks over to on X Slide

Alessandro Maselli

the XXXX another was to Fiscal extraordinary Catalent. call. welcome, everyone, for Thanks, Paul, and year

live deliver healthier our financially that results develop operationally, better people our to a strong During also we community impact lives. both and global mission the the and products delivering achieved year, and help on positive while by making

for delivering accelerating growth environment challenges. broad was prior rebound of for the demand related products the servicing our our to for both our that infrastructure new forms through Europe, commitment intensifying focused our the in for dosage despite industry; agreeing in for fiscal EBITDA $X.XX expand; best-selling and particularly financial America handle for investing currency XX% growth dosage top adding compounds; by segments fiscal constant attractive engine constant was results category to highlights are demand nutritional health consumer-preferred entry to since our one to compared sustainability; was Some a XXXX primarily organic deepening demand accelerate high continue our strategy we $X.XX which the driven and and will products. compared growth significantly to prescription our acquire and demand the XXXX. XX% gummy difficult of XXXX tools potent offering, ability programs, of increased growth Adjusted biologics include: organically currency longstanding billion, record another grew North net year supplements, capacity supply This inflationary the – in which a customers' and market; reflecting our revenue our Fiscal chain at COVID-XX ongoing a highly including of in to company year. in and demand in aggressively the to capacity expanding billion, in July demand consumer on

from up points million $XXX increased income also $X.XX recorded basis XXXX. to XXXX. diluted from We or fiscal fiscal EBITDA per we net was XXXX our share XX.X%, share, in adjusted adjusted per Fiscal margin XXX up diluted in XX.X% $X.XX

out inflation closed translation. business from headwinds pleased more than our results I'm quarter, fourth the momentum on to unfavorable the exchange as that strong year focusing robust with report transition Now we and have – offset

programs. fiscal acquisition fourth $X.XX to quarter revenue our XX% and revenue excluding XXXX. This measured fourth our reported double Biologics from despite XX% by shown segment, which was lower XX% Slide billion, divestiture, on in year-on-year COVID-XX or increasing growth constant the digits was grew as the compared driven in was of constant X, growth currency. As organic primarily currency quarter quarter in When

a currency to was on organic adjusted or reported fourth fiscal growth constant XX% XX% EBITDA measured $XXX compared Our and excluding in currency. increased was the basis million, XX% XXXX. fourth divestiture, When as constant acquisition quarter quarter of

$X.XX fourth adjusted per the the net from quarter in Our was corresponding year for $XXX income share, million diluted per prior period. or share diluted up $X.XX

As my you fiscal was transition X, effective place current put CEO. know, start in role of structure the we the as of day to the also which July same a organizational XXXX,

it our customers better enabling broader to to easier as Consumer also grown a half Health. four years, Our new by revenues on array last services. giving roughly the value to and other reorganization focusing manage Each number the of Pharmaceuticals X. one with structure our Biologics of The from has access our the over has will allow reduced while represents us business the few company two, illustrated total on the of on segment Slide operating and segments creation

first our offering Softgel new of early in begin segment call under supply Zydis coming services. Consumer tablets, and oral market-leading clinical Health a soft and capabilities statement our our will segments, fast-dissolve in Technology, of Clinical and recent and under Oral Services Oral and and the and We formulations, for and issue new includes Notable Pharma also prior We'll chews new quarter and solids, structure, overwhelmingly Health Pharma services Delivery of historical our molecule this results segment complex offerings gummies reporting The small development November. Specialty weeks. the programs. include starting Supply softgel rate in earnings Consumer three trial with structure results the

development and We have and individually established on teams offerings. dedicated focused health pharmaceutical, consumer supply clinical

same the points X% the the which is upper growth result modalities the the employed Pharma our is of new of unlocked commercial strategy, market segment segment Biologics of basis revenue could investment by recent segments net acquisitions. the previous is Biologics in reported than organization higher With a newer enabled we by structure within new exposure internal due some long-term expectation The of combined go-to-market as to synergies customers. growth fiscal three end rates essentially by included is these and small greater XXX organizational many adjustments, XX%, at we segment. higher new to sectors better and for the growth This to and Consumer biopharma now XXXX. Health as our the Our service molecule this segment

– growth growth net long-term remains the structural several expected rate benefits important change. this for XX%. Our are revenue to There Biologics XX% segment to at

barrier experience, and count First, services, business well industry the to do a enable makes meeting existing to for adapting as trends; simplified us Catalent, more in an expectations and a leading reporting potential creating customer customers and be multiple needs to evolving offering for enabling and the it minimized to commercial structure to customer with to thereby access as customers enhanced second, agile easier integrated more customer synergies. anticipating

Finally, for as network. excellence even the us of greater it result quality and a across allows accountability operations bolsters operational oversight

on to end long-term raise both Slide position consolidated resulting long-term across in segments shown growth reorganization, our of in the continued our XX% X. confidence a from our based to growth the the comfortable and percentage as expected investment previous the in XX to our synergy top projected to Importantly, we are compared rate

would organic Tom our growth fiscal like guidance revenue were indicated while XXXX, that we of on will basis. we are I in in into details guidance to The thirds last the call, roughly outlook. our related midpoint After the of end the further later call fiscal single as in formats comfortable sharing on growth accounting product in high-level XXXX. programs, and vaccine today be for takes currency ordering constant of two of from de-risking the our in the customer projecting XXXX the to Since despite range COVID level to around year, review fiscal focus project on long-term in expect account our I updated the compared pronounced in line remarks additional earnings at a new fiscal timing revenue well to we growth in organic previous for to this we make a the some May our the the more then, decline organic fiscal rate COVID-XX-related these model. revenue considerable the for long-term facing of X% with used COVID revenue switch XX%, XXXX, our are of model revenue, problems. XXXX still for guidance we have the decreased given low focus seasonality volumes degrees as to COVID-related our dose Looking our fiscal

growth and adding switch commercial large projection Our grow by transfer to BWI in U.S. new Princeton on and announced Knoxville cell build revenue new meaningful construction, facility growth will later those XXXX our facility our asset new expansions is our medicine lines start facilities drug and gene offerings next Bloomington. in such eight our The completing substance in by we tech the assets organically an at our including in efficiencies our therapy and global drug manufacture cell fiscal commercial year, currently in generate last substance constant lines in driven drug therapy of and XX% including is in which to plasmid maximizing in our fiscal our in capacity opening past Bloomington existing product two the discussed that earning online product announced additional therapy gummy quarters, format XXXX, including and tech in previously previously of revenue. factors, non-COVID capacity in of two several call Europe expected drug than currency due more our our the programs and came to that as other of areas Europe, network, out in business, substance

five million fiscal announced Services, agreement X. is from enable CDMO services over are Mayne facility Additional this our XXX,XXX the of plans fit-for-scale, demand growth, high reflected Greenville, following facility, manufacturing. specialty million has the and not $XXX today Carolina with existing Pharma Metrics well capital to issuing XXXX closing North to drug to the square $XXX on for meet improvements is in in foot will summarized we recently the a in acquisition for years full business ensured last accelerate acquire increasing Slide guidance which Catalent of a anticipated in The Contract

clearance. subject acquisition the course, including closing conditions, Of remains to customary antitrust

more I more acquisition the as expect And expect driven a One segment business by first-for-scale well products. Metrics revenue manufacturing margin biotech to as enthusiasm to the note of potent shift the Adding programs continuation through third small is this the of to our by Consumer after will potent as formulate Catalent discovery, services and of including includes Metrics We maintain which includes of last the XX%. which molecules. that highly several years to growth now portfolio often has solids we market, innovative Mayne in that EBITDA oral capacity to completed XX% potent overall more seen PCH the a that potent in with Pharma of capabilities about closing. of well Health where become a December Metrics. can to number certain deal the specialized oncology yields XX. Metrics facility before complex reason margin. matches than work pipeline, and and our manufacture intend its with number the our of compounds long-term facility Metrics the of supply XX% handling. comparable the for opportunities strategy require the green Pharma In oral drive in utilization. numerous offerings generated over growth part potent the represent in soluble is the balanced industry growing the projected [indiscernible] require growth compounds, strong Greenville pharma which as agreement pipeline, increasing product molecules X% close less acquisition in large from a customers, to several acquired to segments the revenue at margin to we we to business the $XX the XXXX or Pharma after emerging Once Metrics our closely service than is customers, long-term deliver fiscal million for above handling services own of growth time party from during are to industry accretive of our Mayne and handling,

last is market drug of with headlines, that's biologics frequently year. the compounds While in And oral delivery in is up approximately description the innovation the development, currently foundation organic targets. still like X,XXX a been of the mentioned from more in XX% for in of oral almost a substantial meet success, long-term position being has pharma acquisitions activities. combination including portfolio investments and M&A strategic recent our the positioned our long-term The to our strong overall our Metrics focus pipeline

the long-term the our remarks the team my to fiscal this on a strategy, lay fiscal objective we the present I and year continuing supply the have patients ambitions, a foundation the together position XXXX me lower goals pressures, on us. for energized navigate which the we executive industry funding, chain the as am for in seasonal another team let in today, the supply as issues morning deliver rely As exit by growth I challenges, in obstacle and set for rest the Europe, energy Catalent also more biotech uncertainty to facing of place me us executing inflationary by for strategy the demand vaccine add our and roadmap working we for and deliver our pandemic. strong and who help include

in position serve. attractive the in strong a succeed We continue markets to to we be

a Board distinguished at elected Senior continue delighted Board's be I like become newest was and recent service Finally, would able with of the Karen effective retired career involvement in long last XX. after Karen's And most who the Commercial by role member Chief her Flynn, September our we Officer. Directors as Catalent to Karen week are President to to company. congratulate industry pharma Vice with to recently

Now, I would turn like over call to to Tom. the

Tom Castellano

to a be segment. constant compared gene in demand Biologics, Thanks by in performance organically Slide offerings, year-over-year quarter drug programs. million than currency. Alessandro. strong XXXX. net net on revenue I'll more offset driven COVID-XX-related revenue of and which I'll lower where with growth fourth cell XX increased therapy, our discussion our and this the This product begin from QX drug segment growth revenue substance with commentary was segment $XXX the in on XX% Biologics increased around of will start morning

XX.X% revenue see product The to commercial COVID-XX revenue. year-over-year When a This revenue expected driver fiscal is marked will classified and COVID-XX-related of purposes. recognition program conclusion EBITDA third Year-over-year of QX year-over-year. the year-on-year. down basis bar not fourth points the for with recorded program XXXX XXXX. in in the than both was of generate XXX that more that which continues quarter commercial QX sequentially third over XX.X% by up efficiencies, activity than site Note, was in operational in remediation-related the revenue declined the margin more from Our the in fueled up year-over-year expansion XXX in strong decline than our impact costs graph that the was The and offset on of lower at peak remediation the were QX segment’s Brussels. at is activity as sequentially XX, XXXX looking the Biologics of fiscal margin fiscal basis points remediation you and future quarter the quarter. Slide

In addition, was calls mix mentioned is on past away market of approximately component shift total a vaccine lower XX% from margin which revenue, COVID revenue. represents by aided sourcing

so to from continues margins that diluted component sourcing revenue COVID-XX have decline, As the will recently experienced. we related

X, EBITDA fourth fiscal acquisition percentage contributed XXXX both The XX prescription and segment’s well exceed and points of Softgel XX% revenue acquired net revenue continued expectations the with was increased XX percentage October EBITDA XXXX growth in remains Slide over on operational as shown the fiscal increased during performance net SOT’s Oral Bettera expansion as for to The points As health continued period products development the growth to our Bettera important segment for to the $XXX SOT compared an margin the Technologies, demand million and XX products. last same to year. quarter. consumer by increasing and of driven revenue business company. for growth quarter organic the X% driver and net X% revenue of continues of

Specialty Slide XX% Delivery the demand Overall the year. inflationary margin. driver challenges, by muting EBITDA Net last Zydis segment Oral of pressures segment. EBITDA royalty segment's of related of our XX and organic unfavorable primary fueling significant overall of agreement strong quarter was on a fourth product growth. the the grew a However, demand reached a shows the weighed to mix further level, supply and record which results was XX%, strong over platform, revenue for demand. up and Zydis impact chain increased revenue results, was supplemented offerings from This our

posted Clinical storage Supply driven by unfavorable distribution driven $XXX services. growth on fiscal segment As XX, X%, and Services Segment EBITDA declined of revenue our net fourth by X% XXXX, over million, our of representing mix. shown quarter the growth Slide in

$XXX the fourth backlog segment's at June book-to-bill is million and X.Xx. up $XXX million June trailing to year. the of quarter ratio $XXX from prior segment As XX, The wins the was XX, of quarter compared net XXXX, million the of million, for XXXX. last segment business XX-month quarter XX% in The from $XXX the fourth of end new recorded during up

EBITDA adjusted Slide to consolidated our Moving on XX.

increased Our adjusted year. net roughly the fourth prior XX.X% of revenue, line quarter with which quarter million compared XX% currency our On EBITDA fiscal basis, XX% XXXX. adjusted a fourth quarter to of to of increased $XXX in EBITDA fourth or constant quarter was the fourth the

the $X.XX basis margin For currency fiscal increased XX.X% XX% year, on full Adjusted billion to over from adjusted basis. fiscal XX% XXX XXXX XXXX points XX.X% constant XXXX. fiscal a in increased to EBITDA in and EBITDA

Slide in income income million quarter share shown per was $XXX diluted fourth net $X.XX adjusted per of million fourth on the compared quarter $X.XX net XX, to adjusted ago. or year a As $XXX share or diluted

net Slide Catalent's X.Xx share in or This net For was long-term net XXXX, XX, as leverage X.Xx, XXXX. and on slightly of net X.Xx. to of target ratio allocation X.Xx leverage June XXXX, below March XX, capital compares income on $XXX our was adjusted million ratios or priorities. June our $XXX of fiscal of XX, debt-related compared diluted full income our shows per share $X.XX fiscal $X.XX year, to XX million the per XXXX. adjusted diluted and

been as balance our that free XX, XXXX, $XXX was Note pandemic cash two our the cash to the negatively strategic March XX, combined securities our impacting years compared XXXX. have cash we million the patients June customers on has future future realization and inputs at cash, of our assets meet impacted marketable equivalents continue impact flow which supply allow in the to to their contract onset with million have $XXX combination, to of feel of drive increase free decision after of and Our supply by us as last of to levels, inventory need will the to appropriate, flow to reverse a positive obligations negatively When are the of cash our which begin effect free comfortable and manner. XXXX favorable timely fiscal chain, is stabilization our flow. will also more results. a we time a course, the Similarly, on will our we

of As release where percentage related increase as and we cash June when of The vaccines, affects is to versus overwhelming programs. for June approach of large revenue affecting it was flow. as in notably is our invoice development based balance the compared batch able entirely to free recorded are is contract a asset negatively XX, on programs, on some of such for million, of an $XXX XX, this some XXXX, customers, million increase $XXX commercial XXXX. This majority cash realization delaying thereby completion difference COVID to

Moving initially We XX% that XX% fiscal revenue well appendix chain-related some capital to supply percent of percentage on was CapEx in by lead CapEx spend. and fiscal expenditures. illustrate driven slide anticipated a we the was as times our new our for projects. In initially expected as XXXX, compared a annual a CapEx for a XXXX, XXXX. to as growth as of capital in lower added of revenue delays revenue higher-than-expected fiscal some bit than than longer

be expect revenue. as in approximately or we XXXX, XXXX, XX% a XX% fiscal to CapEx similar fiscal For to net of range

assume Slide in financial XX. our remains macro to as outlook environment turn midpoints stable. challenging outlook fiscal we for the on our XXXX The reflected Now outlined

the that of and X% forecasted Bettera than revenue We of EBITDA remaining forecast, to revenue $X.XXX FX $X.XXX first quarter this positively impact on as-reported inorganic compared growth points negative of on have that October billion, expect on full adjusted the basically in the percentage acquisition Current year will one acquisition our percentage to until an we impact annual to which which We growth X, growth. net are basis fiscal our three reflects billion point. revenue, approximately to a use XXXX. representing rate four of range anniversary rates, less by in X% project of to one

we So at transaction. growth in after our rate acquisition currency range. the midpoint considerations, during The approximately into following fiscal the will these of organic taking of of earnings first X% close XXXX the revenue Metrics be our guidance share two will into expected account is call the factored constant guidance net updated

to year X% adjusted name the range like expect billion, fiscal would rates remind we weighted second XXXX. of of of representing EBITDA be to growth I half X% billion of to our full and $X.XX you to business, to expected historically XXXX $X.XX EBITDA a the generated EBITDA, XX% at back of the roughly reported For year of where half compared revenue adjusted in is generation of fiscal with more the to the year. seasonal

Now basis. we a expect constant margin on limited EBITDA year this currency

Princeton our fiscal domestic. in costs we on XX%, our that of as margin in exchange that are translation are margin our and of pound. of the supply its acquisitions revenue on and there Note profile higher than greater been pressures, substantial target organic fiscal from factors of we're achieve declines the and swings a impacting to assumptions prior in to expansion XXXX, our asset impact corporate related volume While the which have absorbing outside to chain Oxford, anticipating, acquisition COVID-related the costs headwinds our foreign including have because we track XXXX inflationary is while a euro are U.S., neither of majority translations generated FX EBITDA start-up number still margin

net income. Moving to adjusted

expect from to ANI decline a to range a representing million to million XXXX. of X%, fiscal of X% $XXX of $XXX compared increase We year full an

negatively more X percentage points. impacted translation of by FX ANI is However, than

affecting in adjusted the growth fiscal EBITDA, In addition, the following is items. of as as ANI being items all XXXX impacted well by

to XX% in jurisdictions. increase XX.X% range, higher tax year-on-year earnings the waiting the in XXXX, XX% higher expected given an fiscal compared rate in effective in of First, the to tax

Second, we an raised part is The interest Bettera the expense acquisition well the our to rate in our new increase as last fully rising asset of as in of interest to due is interest year debt finally, current the fund count. servicing base, related full due And increases significantly in to in also increased heavily environment. guidance piece more depreciation larger weighted diluted the U.S. expense other the which share

offer As income or number in a share the which years, diluted the to past EPS. share basis, needed on we average is guidance on weighted count net compute our per adjusted adjusted

XXXX, to count Operator, fiscal to now shares. like for be we million our million open and our questions. expect to XXX prepared the of the concludes call we in For would share range XXX this remarks,

Operator

Our is Instructions] from your line now with question Morgan Tejas Tejas, line Savant open. of [Operator Absolutely. the comes Stanley. first

Tejas Savant

Hey guys, good morning.

on can new just as dynamics. ramps your here on as you of the terms maybe think pieces color also EBITDA, bps both well COVID that line, there, following-up share And out you that on FX contributions So facility headwinds, remediation, moving the margin XXX inflation remarks I the Tom, outside some on the of top XXX some hit and in facility the called normalizing? to

would a EBITDA year if the the color mid-point and fiscal finished some on helpful. you and guide that margin help share where bridge from next can So XXXX just build be you of

Tom Castellano

Yes. Sure, Tejas.

for question. So thanks Yes. the

to line X to are from it in of So impact do there. a say did little the of more to terms in an FX, just mix the bit EBITDA. earnings of of X on on your revenue given than impact points spot see in top geographic the FX do we FX would the I talk We line bottom numbers we about

towards range, where the more the mid-point low I is of that say impact – more towards would impact to of that is EBITDA to range. the revenue I say top So FX would the the the

related ability a utilization and a even say cases, continue of say given our third were than just of margin what some after what challenge into quarter margin guidance And between of is side mean, – pretty volume the running on to able to here. to where at then macroeconomic how our that. pieces a past, impact was consumer an in So as call we’re COVID and in a would’ve lines, related and that prepared that point on to help be relatively XXXX decrease to specifically we’re COVID But story health seeing consider modest hands is we related seeing SOT given talked seen levels of have figure to relative EBITDA position From on that as of where dedicated good from profile look, May XXXX, comments – going in we reflected my we times here. Other doing price, we in career. items, impact comments the challenging our and chain high inflationary absorption that environment fiscal mention there a year, of looking fiscal what currency we’re be guidance two-thirds a And challenge. overall just remarks my a moving giving impact the this I Segment into standpoint, to so as play in a X here the about chain I material of well, more are into I in our of we we’re seen a are would seen will fiscal and continuing a doesn’t result most do customers, basis inflationary in account I the remediation constant XXXX pressures, wages between we’ve at our Brussels we’re into can difference that offset to improvement And some normal that, a obviously be that sure. margin in taking de-risking we standpoint, in our just efforts I’ve further in to a mentioned of to probably we’re more supply and these there. our things terms to just in did I from take our is basis the would haircut have the Supply sitting we here somewhere in, key to that a half obviously, of assumed position revenue would a the now as bit we’ve they what part where about these role as pressures. on environment, in on saw volumes well ingredients active off in to all more impacts get around inputs our our other that’s for impact volumes, little recently pass those

I say year over see target a – to we’ve seen points be track XXXX. the EBITDA remain of we’re like by We committed XX% a I’m fiscal Tejas, sorry, just by going not long-term margin to XX% basis margin several margin our EBITDA to by last years. expansion Lastly, margin on although, would continue the we our XXX-plus from

Tejas Savant

see for versus long-term just commercial there it. to you uplift? had think in that you segment target, Got Tom. in changes before the a the terms then about color the Alessandro, embedded alluded one you synergies impact helpful, you your standpoint, growth That’s pointed any the prior as to? super expect the where And from to do structure And that operating customer biggest on of new of what rates

Alessandro Maselli

out Look, customers, low way a from organizational than biotech which the the look customer is Catalent. just sure. customers, need onset incentive plans the Catalent, opportunity many still is significant allowing of Look, the an organizations, of in they which regards. the And percentage been one percentage. at this in from when internal three and organization benefit it’s are as cross barriers small service will go-to-market to simple the have and is there previous both the than those very one people clearly of trends Sure, required service our relatively with type more this a some these you strategy have And share since there creating little standpoint. And buying our past, removed. that not of already from are are we a to customers, adjustment. you seeing easy the a of where more customers these some new from good from across the although bit the combining by when of increase base execution is of web, of together, more existing more more very offering. out offering And In customers, of barriers which one new look service Catalent these more an was are on wings. going than There all at enjoy side, ways

We already of that of made in this regards gummy is the guidance the the this above gummy segment, with have look, this segment. we rights significantly said business. So increased average growing business investments the for

to America, self We inorganically up growth fastest high that opening oral bottleneck also business enjoy bit a lastly, of the was were both the we our North And the which segment driven oncology primarily solid growing are potent, have organically pipeline. expanding demand on little offering and we have demand. constraining that did or in the constrained. were that whole seeing complex and resolved there. which really We And have the the solid, capacity couldn’t see we some in by sub in we demand, now is we past fact the

these rate combined impact All that of segments. an the on really growth expected of has

many unlocked in making these the these were these last – two organization. So things in the are over by ways, years new

Tejas Savant

Appreciate the color. Got helpful. Very it.

Operator

your Thank you for question.

the comes Luke, with Luke of line question from line next Barclays. Sergott Our open. now is your

Luke Sergott

guys. Good morning, for Thanks question. the

COVID the you here scenario guys? based on frame for worst What two-thirds So So guide. on if of the guidance case down is Can jump XXXX? midpoint the us and best is volumes. the case you range in in real quick would be help the the down what for

Tom Castellano

there’s smaller, from that than past. it smaller contributing terms is say the been really guidance range. two-thirds at it that here has I I taken key saying, I to XXXX, where level start volume would COVID relatively I don’t of just fiscal contractual COVID by that an not significant much variability have with reflective that’s variation puts around the a know would were a that Luke, here, we say, of assumption levels is would say, down and here maybe down end we’ve would in the the the volume we in So customers decreasing low I in obligations to

the demand in are I range the the can of But there’s the going would on Now getting guidance. we to see the COVID of end increases challenges of and if swing I around terms we obviously difficulty outside on of lot the say, variability wouldn’t that chain related that materials high any factor the that here range. in a COVID any here high hands related real to our have there’s we throughout significant there. into is say saw. or material end assumption our range supply And just

the lower impactor As macroeconomic I is on that – worse, I pretty the versus get a outlook would of midpoint range were COVID to mentioned, range a firm around steady, said, in much to today to potential that that the contractual a movement obligations. we’re be the we us the on that assumes feel getting which pretty the remain of end here environment of as further based towards good and any more if side,

Alessandro Maselli

Yes.

were The said I meaning here is the other spring, those vaccine variables there have piece COVID half primarily impacting fiscal – a our was variables calendar the is, for of during related, add number times And still that we on Luke potential first many demand. significantly second what year, significant the year. our of half outlook would next

of standpoint. how vaccine that our creator some regards a now in of have the from good our We we with forth. outlook the behave around primarily so vaccines and the settled of the seasonality pretty the script made variables going a reference So seasonal those are to now have and

year, first better fiscal half which is in the of are – the we a the so to position And months next six of our second year. forecast

solid believe is we today. I outlook this providing So are that a

Luke Sergott

And then Great. right. on All just follow-up a that. quick

So coming that I chains broad-based? when – just us just you’re thinking the hitting done Princeton supply or that there’s these the guys think And about us and these it’s you then about are is capacity in offsets and – and talking is how from then sense elsewhere. hardest give indication help a coming of you easing? there can it expansions a particular mean, Bloomington in on all you suites you’ve Can Indianapolis, the about

Alessandro Maselli

a it combination were in in we a where meant these when years to assets, which new is to high which three these comes number potentially have demand. assets, meet assets last areas, demand Look, therapeutic seen of of new several over the

which the well. And the oncology approved and we pretty remarkable. pipeline cell now One therapies is of is oncology, this diabetes, with see where area some obesity an surely Neurological disorders for are new this combines as opportunities.

these these were all assets So areas. indications therapeutic and demand meet built to this primarily from coming

Tom Castellano

in that Yes. highlighted recently Tejas, earlier And been more I seeing particularly and our lot comments we’ve side. would as to just add health of the chain challenges to have Luke, I on impacting SOT business my supply that, been the a consumer

molecule towards So referencing, large assets not yes. those that are geared biologic you

Luke Sergott

Great. Awesome. Thank you.

Operator

you Thank question. your for

Our next question the Qin line Morgan. with from J.P. is line your of comes open. Julia, Julia now

Julia Qin

morning. good for Thanks question. Hi, taking the

just a up guidance. So to the clear couple

how embedding the light been earlier, How the the for pressures other revenue contribution and any regarding you Has started heard guidance? [indiscernible] of non-vaccine XXXX, outlook the I pricing and inflationary First, FX. are in about in COVID to businesses? much de-risk there fiscal changes you guidance

Tom Castellano

Sure.

you first fiscal I base fiscal the of to that standpoint, from was de-risking of the – side. substance impacted that out standpoint, to to is was in contributor significant that bringing And we of would that I product we significantly biologic another offerings. contemplate guidance. so my growth growth business on business across in That’s mention the two-thirds significant would growth reduction XXXX. significantly a cell X the fiscal be both in it. fiscal of our therapy are a we Madison are the Bloomington obviously But growth have going do of by business related in part, volume does demand was we’ll XX% be guidance the in to COVID well the look, as here and business a X not that obviously, drug drug that excess question, That be as during in demand, That Oxford a will technology best XXXX growing COVID facility. offset growth from our a our in gene terms related story. your bit online year. But of all XXXX and seeing here say, capacity seeing the second COVID by part Europe seeing we that a impacted result say, I’ll answer broke COVID from related as up is the a not So Julia, did little we with here

business is. I part of already of in was challenges what question about our And terms of talked of there the I has consumer may growth – not we’ve pressures. bulk COVID are of there think vaccine mostly your chain part questions from a driver – would a side The here. impacting therapeutics we’ve health think the the think say, supply COVID in related I impact been your more the second talked And related therapeutics significant as that around have I our related been about. revenue. revenue terms to in and COVID inflationary of

the customers then customers midpoint our two And guidance to on constant to to, terms wages seeing XXXX of as off be in despite be the are side. well up where well able on our margin the in cycle driving as say, for of basis. contracts to times through that we’re that of year, ability a as, many price increases those would to where give as what seeing would able active fiscal all are again, suppliers increases they normal I recoup We we’re currency being vendor us our a looking looking impact. ease challenges, But at modest to at we expansion from

Julia Qin

Great, of on thanks. guidance, that. the the And raising long-term high you’re end

still of outlook improved side, to XX% biosimilars? given the the has there on biologic that on side been modalities Thanks. for about that XX% achieve growth? take XX% kind the revenue synergy, how full Or around maintaining the talk push And what’s the of midpoint to it new any long and potential are the end happening growth. of you high think to will the then X% PTS, you you that on towards can incremental On we do and

Alessandro Maselli

terms the new have we answering that already that question, Sure. Clearly, we of is short-term segment. guidance growth broadly by indications said, very accelerating of to projected single that driven. your are the Look. we transition don’t of segment in towards seeing I give as But

did one gummy business already look that If years, in be will the completely mention, of are last were only the There organic which it’s be quarter I that the this is factors to year. right? So inorganic. couple some addition behind where the of in at of them acceleration you going play

only we expanding much the capacity meet asset, to have area. very ownership on we now a So demand in high that are the accelerating of full not but

well seeing are which in challenges. anything continued another a rebound cough on complex general, years. been is by executing the Our acceleration has over quite there If is so categories North and say the to last there programs, we consumer we’re would for is on as cold America are which few with to expansions demand. solid and well trying all area have And and specifically relief executed and coming available our I overcome team secured where pain product we supply some significant

are these all confident when play which are dynamics, in at been we commercial last few synergy. and in that, that mention I these dynamics that accelerated look the quarters top already they you On to So coming have of did fruition. of

we will growth. organization to allow accelerate enable these going further the new are with So to

Paul Surdez

operator. question Next

Operator

Thank you.

your of question is from Jacob Jacob, with the line comes Johnson next open. Stephens. Our line now

Jacob Johnson

the but Maybe the as just $X.X you what over got about talk you number segment that could Bloomington of BWI years? revenue off amount starting capacity level morning. define Biologic and couple a a FYXXXX, higher out Oxford you’ve Good growth a next years I the biologics added to number – quantify, of Princeton, capacity or is last of I expansion, your there. for know the several Master with Cell, and of billion, to question. just capacity think addition we mean look hard can in

Alessandro Maselli

by can target, Look, remaining the capacity positioned we’re that deliver the that do, execution fiscal on what we to XX XX are pointed – to months, added next sure. XX you with execution it’s and and going you continuing quite is have plan last that very I as well we if Yes, months our the tell that to you like. remarkable, the have out, in XXXX we

created that fiscal many capacity utilized of target. a significant the that ways already we once the have XXXX deliver amount So in getting will

complementing created. So product, this been a the giving drug capacity we’ve But to of probably the little way offering when is at bit been to focusing look being another primarily you of comes measure with look, quantitative it the that, be suites vials. in syringes identifying when production, suites XX our essentially will drug comes on gene going top doing BWI. of And production we’ve substance to therapies, expansion, just a comes it schedule. to it And to XX from when

of of the of this gives forward. a measure capacity bit you what is going So this little potential a again

Jacob Johnson

off. you drug a those just softness about Thanks, kind non-COVID switching it. then Got timing COVID Can your something so the assets can year? of applications? any lag with roll or Is in be to think talk lines on of over? that of about Is the little transition transitioning that or where period kind should new And downtime there Is could maybe there the just product how one transition And you XXXX? quickly the how associated early throughout maybe we not Alessandro. much?

Alessandro Maselli

transferring happening One the are new parallel. were the customers COVID on and we’ve to is thing that parallel seamless, in products, still built serve programs to Look, the new in predictable, it. mostly the the to is better been meaning that still enough are which we’re onboarding mostly not happening is and we of lines. totally new many have which while getting leaving ways much is COVID transition is lines vaccine satisfy although in now new lines capacity transferring in visibility which wanted a to possibility always programs, We demand, that

that would I you seamless. So has pretty transition been the tell

is formats ones are be some mostly of With vaccines. remember, vaccine and lines. starting validate supplies are programs about are we current but the still the large You don’t on of have like things served all on to entirety line, and stopping the different that think of vials making going for and in on vaccine them out production happening while – new, these that going fact to different current something of in these regards vaccine which lines, onboard made extent the to the on can some them COVID a the of of to

to gap kind having a dynamic a as of type in it’s of in out phase phase So between. opposed

Jacob Johnson

taking Thanks it. questions. Got the for

Operator

you Thank question. for your

Bank of question from open. with the Derik, your comes line now Our America. Bruin De of line is next Derik

Derik De Bruin

Hi, for questions. you good my morning. Thank taking

a That’s segment One, embedded off which biologics just first and what’s shoot the the I’m by So growth the I’ve going got PCH. few, organic here. for to revenue one. guide

that a The that reduction two-thirds also the second the XXXX. one vaccines, your by talked your I then one assume to for revenue or XXXX. two-thirds talk you And EBITDA going about when something contracts. there? pay you you’re backing about number third is, I are I realize mean, implying volume is still a you have for some XX% reduction? adjusted margin COVID be XX% you Is take

should think Just if sort Thank number next that we that’s rebound about you. year. XX% how for the of is wondering

Tom Castellano

jump So free I’ll to Alessandro here. in. start feel

around the think I your terms understand fiscal that a that first, of for target what give continue deliver question on have to EBITDA year. XX% there’s with over track we’re not heads what is environment position start this last macro still the in to on we’re looks I’ll absolutely – like Derik. guidance fiscal XXXX. ability So margin Look, to today about and at in a lot point the XXXX. our where confident said to and I next be What And

segment prepared revenue excluding about on specifically by XX% growth that business did talked we’re a remarks basis, segment comments we business that’s I in terms our COVID make the our demand. a organic seeing here, of say, across XX% In would we’ve not something – growth

here. demand it’s in thirds made very you be COVID-related would able based can XX% two tight that headwind take COVID you to a And I we’ve to in some customer have a be our on based XX% into difficult say, on is in math disclosures and including on impact here what do think to estimate related as related I as that XX-K as the to and pretty and consideration, come be biologics, disclosure, within well the that growth range. volume concentration able will see

maybe the reporting a from business Pharma in and is we’re basis, on to OSD SOT, growth that here out I business growing starting basis. that next think And those obviously quarter. next can the a that in from that’s outside So, segment obviously COVID you as seeing Health of are there, take we long-term our XXXX guidance we’ll Consumer XX% be outlook XX% and X% considering here, across where

Alessandro Maselli

Yes.

And already so your about last look to them of we while on. routine a I’ve take with over of to very question feel we been We’d find Again, great kind the our everyone. what listen with making and months. partners our that the take regards needs. around and year-do-date has a strong read being pay commitment try of pace also landscape hard is mindful very So, the question to few of for shared solution for of that a clients sure win-win we

business, having as relationship approach. the optionality breadth very, part due good us is So, outlook than very I securing this of contracts volumes the offering in to or are success which which non-COVID Catalent and else. with is in successful partnership gives leveraging some is of growing more the on those in sometimes of of many at also in have we these the non-COVID trade something ways, business that in XX% been non-COVID long-term, approach, believe due – our what to

so confidence – in our that’s of non-COVID and good partly So, of we behind prospects our is is approach part created We company. feel about the business our the in a far. momentum believe long-term

Derik De Bruin

you. Thank

Operator

you your Thank for question.

Meehan the Nephron your line Our comes Jack open. next Research. with now is to question line as Jack,

Jack Meehan

talked would Thank this you. along of the of to terms the seasonality about the provide be can seasonality? there pacing it quarter anything any some especially of help in of pertains Is morning. year, of with for first questioning Wanted help Good continue just around helpful. you the You expectations, guide. business line that kind to maybe as

Tom Castellano

by a phasing I’m give seasonality I Yes. phasing, probably that to to like see Look period probably in of in did let generated here from say, half but that in as short half fiscal just Jack, in guidance would out we’re that we’re commentary. the got like volume quarterly a first feels XXXX was fall like from going QX bit XX% to to through what seeing seasonality skewed given XX% I feeling did fourth I what fiscal seen see referring more to And play that dollar what back can make we of than We EBITDA prior quarterly a the a how second standpoint is which perspective, the more looked what year. you quarter specific year in some again, saw say this fiscal the the would sorry, the year being now, fiscal I’m of a where in And that, me sequential reference we declined – directional XXXX you about our fiscal close XXXX fiscal so that business. and bring XXXX, COVID-related our we QX, to fiscal XXXX. we quarters fiscal in XXXX, we’ve significantly of year; time proxy more would increases that going here, little of absolute giving a of mention in say, point XXXX quarterly XXXX and terms fiscal for splits until was to here. the XXXX obviously

Jack Meehan

metrics. then And Great. helpful. That’s on

the disclosed of revenue the agreement, $XX you annualized trailing what’s with supply should expect we So, over million the close? upon sales contribution

Tom Castellano

we and the the we this expect We what the X% contribution close of being get would by we’re of closely about use of see very partial of of the transaction. would how aligned from look the do knowing we’ll So, that a like. to specifics a to year close to do as when XXXX. again, year can the million $XX Consumer business in new on Health fiscal talk the around which base, And to did that, the will depend business we guidance calendar here end Pharma rates much see growth metrics transaction, that that here. that more will only that XX% timing exactly And be obviously that and you hoping

post in EBITDA some first deal close. So, we’ll the call once revenue the the around XXXX, contributions, give closes fiscal that more specifics and

Alessandro Maselli

reason the add One one just we more why would I space. do general. like comment

So pretty have prescription normally solid visibility on on a is you that good the a revenue.

So strength the for the good of given pipeline. the of nature business prescription and fairly a horizon, the

Paul Surdez

operator. question Next

Operator

next Paul, comes with your from of Knight Our Paul question line is KeyBanc. line open. the now

Paul Knight

for in are expect you give you the productivity could today there with some thanks are question. metrics Alessandro we Are strategy? Yes, in the us you Hi. you the this Where go-to-market around halfway strategy? where

Alessandro Maselli

over I our are machine, a last That’s would question. which growth the four, sales place. great pretty we’ve I very look, organic years in producing a about five believe, we has good consistent I say. been been happy always

when we relationship one of sure full the with we one of the rep with offer terms service. customer, relations in customer, than more of just and is engages that try more take to Here advantage making have and the sales do the our

So, advanced implement look, pretty the, what we trying point would the that in plan, specific I we of say I here. completion of cannot a to are percentage are but to

our drove, the of sales success an the the value a really way and is by value basics so where and that this years they good you not what the need can Our unlock very, revolution, see to our last few so enhancement remain is barriers. internal blocked foundations, is, machine was we strong strategy very and market but in

Paul Knight

single guidance that it increased optimism growth around the I basis big increase your due long-term drivers plus think best are way cell of to to that your is or Is the XXX the or raise outlook, you point XXX therapy? Can that that? What dose ask by fill-finish basis components points? is

Alessandro Maselli

for company, the in of the of hard the which addressing gaps is contributor small been fact the the overall on that dragging in very, molecule to was implement news But the very there. story the I dosage the the growth the which I the solid we in the acceleration as in related were the high out story that's again, facility, very, which in molecule to driving little top is point if are same at in were and company, is of which in health, will background of strong. more consumer remain at perspective to the bit XX%. very like crisis beginning came you healthy well the And the from on pandemic, consumer had everything the little we on. investing like working health significant sure. very Yes. States, the the XX% portfolio rate the this side were in bit if remain in complex, a form we've pretty, the dynamics that to faster small serving and that of chews, and Yes, is under this of back was initial soft Look, time, the of oral much during through not vaccines before, small getting were of we gummies a able period making an growth that the down Biologics organic really in very that leveraging the increase. the growth allowed fashioning molecule biologics, we’re that some after at We the is understand believe pandemic side in enable the very what pandemic, which the a facility, primarily so driving that pretty point to company on to overall radar. and at United What bullish market expectation demand some the increase Biologics which our these you a pretty behind in Kentucky growth is our assets, Florida footprint, was I went again, as

the our really have this the comfortable that PCH comfortable and increased what side on increase, So PCH for in is really a more to compared see us the driving of more you we company the the outlook raise organization. basis And need most, end it's our points position to to the about on is past. the guidance top long-term XXX putting side

Paul Knight

you. Thank

Operator

question. Thank your for you

Our now next question with your from line of Windley the Dave comes is open. line Jefferies. Dave,

Dave Windley

Hi. and more Thanks. of Good then question. clarifications strategic couple Have morning. a

quarter So $XX royalty in the related maybe be about calculating estimate? am these that I fair million? would in a Is right Zydis

Alessandro Maselli

hadn't was we the fact that a it driver disclosed We of there. significant the contribution point what David, to margin exactly did profile. was

able So that's think in I triangulate something to were I do you that directional. and range, if think math that

Dave Windley

Yes.

COVID of talked lower kind COVID with impacts the dilutive two other from I'm on Okay. is the kind assumptions bottom-line sourcing those hand, And if But COVID. then of margin about on, volumes, together? you impact in the accretive margin from margin Tom, lower guess component wondering taking or I absorption lower secondly XXXX lower

Tom Castellano

that obviously say, I is here, start about look, year. I referencing of right. Yes, the we piece in dynamics it's pleased that – and really we COVID-related would that into pressure in, environment think talked slow macroeconomic are – see that seeing a we've position full assets opportunities brought expansion – talking revenue to in think mentioned the are fiscal the XX% syringe about see margin that will by something component sourcing related point We declining sourcing start the the I absorption There's you're up would some a each driven about in opportunity the volumes. line And of the the mention as say, items more then that to But the obviously both material of is the again, talked did period was company up here. say, We pieces a to our here to with component little takes brought impact of But more that here on utilization we and here and Meanwhile, running right? asset fact challenging plug bottom XXXX right? for have absorption, on on XX%, but these say it that from towards the online would the start capacity a to lot there's that during here. be expansion that line I COVID other. dedicated moving that piece that those I'm just You uptake I replaced, at we've the they pandemic quantifying here, ramp the in in a don't we're company utilization Biologics new standpoint you, consideration. would that assets here being not absorption the XX% the given I an and for levels other look the we're operating very overall whether of to probably that ramp at meaningful despite each we we going and period we than I high in or same XXXX. more path does is offset maximize see the absorption where here other we're would talking modest with a the margin bit say segment impact overall. margin have the during for on fiscal fact essentially about we're normalize online just they've we

Alessandro Maselli

as And essentially a significant you're for a little bit area as in volumes that rest lower the means would production going pandemic will COVID from and of on that the produce in shorter the which clearly to use, a resemble the vaccines, tell a of fact other endemic they follow-up timeframe you're to the comment transition more mode. I you these no amount a much vaccines

something a And and I yourselves good is very we have So more profitability organize believe that to little time an for. challenging that's from takes that is some standpoint absorption manage bit to plan. a why

that to you where needs our from out account running taken dynamic is We months. as you the the partners, are move discussing essentially this pandemic flat into through a XX be but also with

that into a has traditional manufacturing, – always move vaccine will had always challenge which it You have. more

Dave Windley

guidance So ask your the growth the to is last wanted question there. I around raise and long-term

a about you'll guide. than this a don't we start over Should getting period if a it So public, faster a as the a four-year the point a about to XXXX at as the lower some period than XXXX four-year starting period targets will points CAGR do couple I maybe you're Thanks. period of to after XX% XX%, grow fiscal reasonable do to target think we you think XX% where midpoint think think in XXXX? or since know long-term horizon that want off. that about four-year have is kind of you

Alessandro Maselli

we make time, we – So as that at have all telling we position is we that with that outside COVID XXXX, a a point we with that very same put accurate a we've we a there, fiscal are is that. strong standpoint above transition some the the line clearly, XX%. these reducing do the provided and to and that highlighted from us the be little guys transition look, moves towards, our are vaccines. expectations. in year But So relevant I can And see bit on you as – two you believe pandemic. strength remaining business on what information in these to the the math is thirds from business, shared the bit us notable We more And all around right? the non-COVID can, little be, that our portfolio a refreshing, strategic fact expectation the done so. retooling will

Dave Windley

great. That's you. Thank

Alessandro Maselli

Dave. Thanks,

question, Next please.

Operator

[Operator question. for Thank you your you. Instructions] Thank

line William is Christine, of now your open. Our question the next comes from line Christine Blair. with Rains

Christine Rains

the Thanks for Hi. question. Yes.

Just one for me.

any approvals year last Catalent's the near-term FDA impact of here? insight slowdown year; half playing on do noted dynamics having in in a into So you see we've first is the Thanks. And business? any over this the out

Alessandro Maselli

going look pretty the opportunities that been forward. from have we our Well, our further pleased see perspective impacting approvals pipeline and been we've with

So Catalent. seeing am last look, out it's impacts it's quarters. products not very products. depends approvals been discreet, bit going significantly – in some of a right, But the macrodynamic there that very the and to in some our happens focused we've little pipeline tell much success It the good very, few on the of necessarily I you,

Christine Rains

you. Thank

Alessandro Maselli

Okay.

Operator

your Thank you question. for

of open. It line the to connection John Sourbeer line UBS. John, with is comes John. now question next with lost Our your like we've looks

of the to next Bowers comes Deutsche Bank. question line with Our Justin

is open. line now your Justin,

Justin Bowers

keep what the the in and Thank then and But will of be fiscal Princeton respect terms good capacity with by the coming new specifically, year? start morning. really it you, year-end to of the footprint percentage out of facilities? when with those I'll long. capacity call just UK that built have jiffy And running online does in

Alessandro Maselli

Sure.

those for answers facilities. very So different

for regards onboard there. therapy already strong very with it. interests one the fact to we Princeton, more time already these running than to cell capacity the seen product, gate Any out is late that which very, commercial related And mostly We've stage us of So is to after the capacity. online. announced is it's programs

around again, deals late I constraining toward ability our these really the stage. and these in into factor So more tech is Princeton these onboard facility, everybody the close and to is which transfers activities remember skewed

we build are these proceeding are The pace. cell of bit of is the open at house of So working going home oncology mature cell start closer the regards story. that's like we're which to needs, talking With to of where side find our you therapy cell on about there if out to is of Oxford, that scale-up believe different PD lines. therapy so I very little X/commercial for a trying we Princeton, programs, the mostly serving are a Phase therapies. commercial

mostly a the larger bit in scale large come this will and little then later be will So messenger to serving And RNA year. facility the bioreactor proteins extent. a

fasting said these past index. start going year. believe generating bit that of little as we in expect assets a fiscal the Princeton We is revenues to We to be that last the

Tom Castellano

us acquisition of that a Justin Oxford add to specifically. here This building originally were out to Oxford. just in I'll and European accelerate our substance to that Anagni able pivot for the then And we capacity facility, related of terms drug in Yes. with was for

our through we're our didn't Fiscal acceleration original able see probably as as in what the position to have – what plan this substance revenue be capacity in in midway XXXX. a contribution as So we've laid drug acquired a we year, XXXX would not that if until revenue through well as said, deploying later. And site, of Alessandro be contributions result we to Fiscal

Justin Bowers

Tom. great that's point, Yeah, a

for it That's thanks. Okay, me.

Operator

your question. for you Thank

the next open. your now is John line Sourbeer from line Our with UBS. question of comes John,

John Sourbeer

now? Hi, can you me guys hear

Alessandro Maselli

Yes.

John Sourbeer

Hi. the Thanks for taking questions.

and the outlook, for the present one portfolio transaction, guess, can in you XXXX, metric after could little activity that how tracking just you in-organic biologic more seeing bit are opportunities? you see any the M&A areas I potential a within additional Thanks. on the then Just for do talk me; and valuations

Alessandro Maselli

and look we I significant the before summer believe forth. the so that moves the in – first see So evaluations didn't

the it to the the into as As to early if we still the, reality factoring starting environment, the of next see uncertainty with of some space of – are when was especially macro couple cost up catching are still multiples the waiting believe capital I new signs comes economical to assets. funding. as more, a years, and well of private of current we

we still a quarters, I they move that So of assets as space front though our I kind expensive few will prospecting I next do pretty the believe add the of premium in have some good in strategic correction because there. expect them. that are

creation what transfers. accelerate generate a also sure an for Catalent, growth our only financial and add it's of much This dollar, asset larger when asset also that would more odd So we strategic more only we a accelerate back. little inserting, bit tech in mixed evaluation? out an can enable believe going by multiple an these. while of growth Catalent, we our primarily that to engine believe never We and tell Catalent of course evaluation you pipeline, multiple is is is And can these, of commercial and of to of can how a a accelerate we're constitute that growth and there not into probably I out believe make synergies evaluation, premium formatics. we I but we'll

completing end, the expect offering a necessarily On are assets, which which this our more downstream prior. opportunities capacity – create additional downstream for other offering we of didn't early stage, this that in capacity have high-potent some will

healthy squarely opportunity is opportunity. interested Catalent we in whenever pretty a of margin So portfolio market. terms I explore definition the of accelerate to an what opportunities the And having matrix the described, in that and expand always M&A. see through debt growth we definitely are in just M&A we of exploring is as a

John Sourbeer

Thanks for taking question. the

Operator

for you Thank question. your

comes question Sean, of Dodge Sean RBC line with the next Our open. is from Capital now line Markets. your

Sean Dodge

Well, think growth headcount margin Alessandro, it add organizational from Are can Good efficiencies with revenue do or morning. also enhancing? that. revenue the intended percentage you we Thanks. their to cost Is need How to or changes the you Does some that should think you you they guess invest longer along the drive do the Yes. enhancing. something mentioned organization? on there's, synergies think realigning I cost that be impact? about commercial term to those?

Alessandro Maselli

make from a remove of all most I our were the across internal We offerings were Look our to buy us to drive portfolio way, right enhancing forth to they there. on of artificial tweak or from already said opportunities sell from Sure. as which sure the the foundations little better, incentive either buy to side, some plans commercial that anyway, customers, we'll P&L by we the not barriers, so them behaviors really, our us. bit, them needed and which and so others a

manage there surely avoiding believe giving PCC side, don't and I is in of little the point impact managing time there which surely, customer clinical of the the So had this that the be, slides, common own drive both distributing to material as for clinical before, did towards a commercial you board you I program, you same close this their the When operational which could synergy across that to us as at not We linear terms development, do to different some slides. had will cost instance in been. trials. about, house. as formulation the best on trials fact different was excellence the management and practices said, a while is is and before we there in any have the project sharing on you side that where Clearly way organization for enables manage used more effectively some that duplication some think bit

approach. an excellence continue efficiency see and to clearly So operational to in linear here regards, drive that opportunity we and

of productivity that that top only us this also yes, do to is drive and provide a we not little growth, these, but expect line accelerated line bottom So bit efficiency.

Tom Castellano

already able XXXX margin being I EBITDA And a of just add than around confidence Yes. had term would more even us our this Sean; fiscal gives to target of, we achieve long XX%.

Sean Dodge

Okay. That's Thank clear. you.

Operator

Thank you for question. your

line your line of Stover the Evan Baird. is from comes Evan, question open. now final Our with

Evan Stover

it. Appreciate thanks. Hey,

equates that past That's point for where long of bolus is the the updated I revenue of percent the your because your would about range some projects? growth revenue talk on the on IPO, CapEx, range to what number plan, relate to today. transitory. one obviously longer it relate long CapEx outlook elevating of getting this CapEx structural your you me, Just the kind how to to where feels after a long kind of here, revenue to CapEx at kind like revenue get wanted can higher the since of the rather growth higher We're point that spent run range goal of plan doubled we than you're we've

So longer a settling number anything helpful. you would provide be of that can on range

Alessandro Maselli

that how We I therapies us. What more capital will expectation when a I like capital to specifically at should our when recognize it. from color gene stage look softgels, you the accelerated that think assets about lower fact early is gummies, now by at in we intensity So these at forth, product, to let segment that you it comes intense look Tom that you so this formulation forth. you provide very growth is development assets come you drug you can overall PCA oral intentional are regards very and assets when in terms some was the towards around tell solid, at, and complex intensity very, But because PCA of news a of percentage when without so segment look when is Biologics segment is And look protein, as as its capital our the lower organic that significantly Biologics. good segment, Biologics again, opposed to revenues.

part a the significant the of respond. as biologics, let specific of and have is terms So of of this to that overall good the I with capital growth that we continues news share Tom accelerated in organization to will Catalent, of portfolio intensity

Tom Castellano

between between Yes, great couple historically the grower, capital we capital I over been Evan. somewhere biologics. I of tops X% the somewhere with a think time that that it's clip X% years spending have at XX% to at X% deployed we've and the X% into X% a and think of we And and last point, maybe were

XX% peers This range. mix I think year is X% shift we've think spending it normal around feels think for like the here what capital our yet the that us. us we of than normal health the growth XX% seeing heavily points for me have I of it's something about any weighted accurate. business something is the XX%, seeing like portfolio, talked longer pharma consumer assets Look, XX% we XX% of Biologics but to are the don't Alessandro's spending to less a we're are intensive, to in of in given pointed of that year been revenue. now out side more the many that I being on that and

given XX%. just maintenance have across Now, how about like much we plus feels more XX rooftops,

So of from new then deployment level to a expect. but base that step quite And XX%. we next XX% at normal down around being XX% exactly I some run do down if to that but not get specifics get probably would I the of know XX% Probably year. sort that XX%. year, obviously to level getting of next back expect there is to, rate, this that the out, to that we'll we close how more thereafter don't this to CapEx but phase need get year, not

Evan Stover

Appreciate it. Thank you

Operator

Thank to Thank you Maselli back now for call. session our closing pass call for your Alessandro question. you. This Q&A any will I remarks. concludes for the today's

Alessandro Maselli

everyone join to XXXX, record continued pleased Thank taking another fiscal we your the beyond. deliver support to are you strong in result our We in committed fiscal and year time fully for Thank of and were to XXXX Catalent. call you. and deliver

Operator

today's call. Thank you participation. your for conference concludes This

You now may your disconnect line.

Catalent (CTLT) 29 Aug 222022 Q4 Earnings call transcript