Spanish drugmaker Grifols GRFS-Q said on Thursday it expects its revenue, core earnings and free cash flow to grow significantly in the coming years as it aims to leave behind a tumultuous 2024 when it lost more than 30 per cent of its market value.
Shares in Grifols soared 13 per cent on the day following its new outlook presentation, extending early gains after the release of a strong set of 2024 results on Wednesday, while Spain’s blue-chip index Ibex was down 0.8 per cent.
In a presentation to investors in London, Grifols said it expects positive free cash flow – excluding the impact of costs and expenses from merger and acquisitions – to rise to €1.2-billion ($1.25-billion) in 2029 and to €350 million-€400-million in 2025 after €266-million last year.
The Barcelona-based firm, which makes human plasma-based medicines, swung from a negative free cash flow in 2023, posting better-than-expected results, according to analysts.
In its presentation to investors, Grifols – whose largest market is the United States – said it expects total revenue to grow to between 7.5 billion and €7.6-billion in 2025 from last year’s €7.2-billion and to hit around 10 billion in 2029. It projected a further rise to €14-billion by 2034.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) should grow to at least €1.875-billion this year and to around €2.9-billion in 2029 compared to €1.779-billion last year.
Grifols lost more than 30 per cent of its market value last year, when Gotham City Research, a short-seller fund, released multiple reports accusing Grifols of overstating earnings and understating debt, which Grifols denies. It has sued the fund.
In November, an investigating magistrate at Spain’s High Court opened a probe into Gotham’s actions over the possible violation of market and consumer protection laws.
That month, Canadian fund Brookfield dropped its plan to take over Grifols due to a disagreement over its value.