ALK outperforms expectations in terms of both earnings and revenue in the second quarter, with tablet sales generally proving a positive surprise. However, in Europe, where there have been growth problems, sales are slightly lower than expected.

The allergy vaccine company reported total sales of DKK 1135m (USD 165m) in April, May and June, while analysts had expected sales of DKK 1108m, according to estimates from seven analysts compiled by ALK itself.

The year before, ALK generated sales of DKK 1045m in the second quarter.

Growth in local currency was 11% against an expected 7.5%.

Earnings before interests and taxes (EBIT) came in at DKK 97m against analyst consensus of DKK 78m and DKK 49m earnings in the second quarter of 2022.

Looking in isolated terms at sales of the tablet-based vaccines, which have been in focus since ALK lowered its guidance for tablet sales in April, sales surprised positively in the international markets, but disappointed in Europe.

Overall, tablet sales amounted to DKK 547m, slightly above expectations of DKK 515m and Q2 2022’s DKK 480m.

Tablet sales in Europe amounted to DKK 361m against consensus of DKK 370m.

In North America, ALK sold tablets for DKK 47m against expectations of DKK 50m, while tablet sales in international markets amounted to DKK 139m against expectations of DKK 95m.

ALK’s net profits amounted to DKK 66m against analysts’ guidance of DKK 58m and DKK 42m in the same period last year.

For the full year 2023, ALK clarifies its expectations for 2023 to the middle of its previous range for revenue growth.

Organic revenue growth of 8-10% is now expected, compared to the previous 7-11% in local currency. The outlook for the operating margin, EBIT margin, is still 13-15%.

This is stated in the company’s financial report for the second quarter of 2023.

Tablet sales are still expected to grow by 9-14% in local currency. The forecast for tablet sales growth was lowered in April from previously expected up to 15% due to declining sales in Europe.

However, ALK still expects tablet sales in Europe to pick up in the second half of the year, resulting in single-digit annualized growth.

The outlook for free cash flow remains unchanged at positive.

Research and development costs are still expected to land at DKK 600m.

(Translated using DeepL with additional editing by Simon Øst Vejbæk)