Organon Expects Lower EBITDA Margin For FY22, Clocks Mixed Q2 Earnings

Organon & Co's OGN Q2 sales decreased 1% Y/Y to $1.59 billion, beating the consensus of $1.54 billion. The sales increased 5%, excluding the impact of foreign currency.
Women's Health decreased 2% but increased 1% ex-FX. Nexplanon (etonogestrel implant) grew 8% ex-FX, primarily driven by favorable pricing, demand uptake in the U.S., and volume growth outside the U.S.
Nuvaring ring) continues to be impacted by generic competition and declined 18% ex-FX.
Follistim AQ (follitropin beta injection) declined 9% ex-FX, primarily due to COVID-related disruptions in China and an unfavorable channel mix in the U.S. that offset solid demand.
Biosimilars revenue grew 39% as-reported and 42% ex-FX to $119 million.
The adjusted gross margin improved marginally to 66.1% from 65.6%. The Company reported an adjusted EBITDA of $512 million, down 18%.
The adjusted EPS declined 27% to $1.25, in line with the consensus.
Guidance: Organon forecasts FY22 revenue of $6.1 billion - $6.3 billion vs. a consensus of $6.18 billion, with an adjusted EBITDA margin of 32%-34%, down from 34%-36% forecasted earlier.
Price Action: OGN shares are down 0.08% at $32.60 during the market session on the last check Thursday.