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West Pharmaceutical Services, Inc. WST delivered adjusted first-quarter 2025 earnings per share (EPS) of $1.45, which declined 7.1% year over year. The figure, however, topped the Zacks Consensus Estimate by 18.9%.
The adjustments include expenses related to the amortization of acquisition-related intangible assets, among others.
GAAP EPS for the quarter was $1.23, reflecting a decline of 20.6% from the year-ago figure. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
West Pharmaceutical registered revenues of $698 million in the first quarter, up 0.4% year over year. The figure surpassed the Zacks Consensus Estimate by 1.3%.
Organic net sales, which exclude the impact of acquisitions and/or divestitures, were up 2.1% year over year.
Robustperformances by the Proprietary Products segment drove thetop-line improvement.
Shares of WST were up nearly 2.8% in today’s pre-market trading. The company’s shares have lost 33.4% so far this year against the industry’s growth of 2.9%. The S&P 500 Index has decreased 9% in the said period.
WST’s operations consist of two segments — Proprietary Products and Contract-Manufactured Products.
In the quarter under review, Proprietary Products reported worldwide revenues of $563 million, up 0.6% year over year on a reported basis. The Zacks Consensus Estimate for the segment’s first-quarter revenues was pinned at $549.7 million.
On an organic basis, revenues totaled $572.7 million, up 0.8% year over year.
Thesegment’s high-value products (“HVP”) account for 74% of its net sales during the period.The Biologics market unit recorded mid-single-digit organic net sales growth, driven by an increase in sales of self-injection device platforms, offset by lower sales of FluroTec products. The Pharma market unit also saw mid-single-digit organic net sales growth, driven by an increase in sales of standard and Westar products. The Generics market unit had a mid-single-digit decline in organic net sales, caused by lower volumes of standard and FluroTec products.
Revenues in the Contract-Manufactured Products segment totaled $135 million, up 0.7% year over year on a reported basis. The Zacks Consensus Estimate for this segment’s first-quarter revenues was pegged at $136.6 million.
Organic revenues amounted to $137 million, up 0.8% year over year.
The segment’s performance was driven by an increase in sales of self-injection devices for obesity and diabetes, partially offset by a decrease in sales of healthcare diagnostic devices.
In the quarter under review, West Pharmaceutical’s gross profit decreased 1.7% year over year to $231.9 million. The gross margin expanded 10 basis points (bps) to 33.2%. We had projected 30.2% of gross margin for the first quarter of 2025.
Selling, general and administrative expenses increased 1.5% year over year to $88 million. Research and development expenses decreased 7.4% year over year to $16.3 million.
Adjusted operating profit totaled $125 million, reflecting a 1.6% decline from the year-ago quarter’s level. The adjusted operating margin expanded 20 bps to 17.9%.
WST exited the first quarter of 2025 with cash and cash equivalents of $404.2 million compared with $484.6 million as of 2024-end. Total debt at the end of the first quarter was $202.6 million, which remained flat sequentially.
Cumulative net cash provided by continuing operating activities at the end of the first quarter was $129.4 million compared with $118.2 million a year ago.
West Pharmaceutical has a consistent dividend-paying history, with a five-year annualized dividend growth rate of 5.71%.
West Pharmaceutical has updated its financial outlook for 2025.
WST now projects its full-year revenues to be between $2.945 billion and $2.975 billion (up from its previous guidance of $2.875-$2.905 billion). The Zacks Consensus Estimate is pegged at $2.89 billion.
For 2025, organic net sales are expected to grow 2-3% from the prior-year level.
For the full year, adjusted EPS is now anticipated to be in the range of $6.15-$6.35 (up from the previous guidance of $6.00-$6.20). Full-year EPS guidance now reflects no currency headwinds against previous guidance of a headwind of approximately 23 cents. The updated adjusted-diluted EPS guidance also incorporates an estimate of $20-$25 million for the net impact of recently implemented tariffs for the remainder of 2025. The Zacks Consensus Estimate is pegged at $6.16.
West Pharmaceutical Services, Inc. price-consensus-eps-surprise-chart | West Pharmaceutical Services, Inc. Quote
West Pharmaceutical exited the first quarter of 2025 with better-than-expected results. Solid top-line results, along with improvements in organic revenues, were impressive. Robust performance by the Proprietary Products segment was encouraging. Strength in HVP and robust growth in the Biologics and Pharma market units during the reported quarter were also promising.
However, WST’sdismal bottom-line performance was disappointing. The decline in the Generics market unit was also discouraging.
WST currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks from the same medical industry are Fresenius Medical Care FMS, Masimo MASI and Glaukos GKOS.
Fresenius Medical, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated growth rate of 28.9% for 2025. You can see the complete list of today’s Zacks #1 Rank stocks here.
FMS’ earnings beat estimates in three of the trailing four quarters and met in one, delivering an average surprise of 15.67%. The company is expected to release first-quarter results next month.
FMS’ shares have gained 6% so far this year.
Masimo, sporting a Zacks Rank of 1 at present, has an estimated growth rate of 20% for 2025.
MASI’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 14.41%. Its shares have risen 58.5% compared with the industry’s 3.9% growth year to date. The company is expected to release first-quarter results in May.
MASI’s shares have declined 8% so far this year.
Glaukos, carrying a Zacks Rank #2 (Buy) at present, has an estimated earnings growth rate of 48.9% for 2025. It delivered a trailing four-quarter average earnings surprise of 8.11%. The company’s earnings beat estimates in two of the trailing four quarters, met in one and missed in the other, delivering an average surprise of 8.11%. The company is expected to release first-quarter results on April 30.
GKOS’ shares have declined 40.1% so far this year.
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This article originally published on Zacks Investment Research (zacks.com).
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