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WST · West Pharmaceutical Services

35 filings

10-K

WST 10-K Annual Reports

West Pharmaceutical Services - 35 annual reports

Filing record · 2016–202610-K1110-Q338-K118

2025
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2025
West Pharmaceutical Services, Inc. (NYSE: WST) reported 2025 net sales of $3.07 billion, up 6.3% from $2.89 billion in 2024, including a favorable foreign currency translation impact of $56.4 million; excluding currency effects, net sales rose 4.3%. Proprietary Products sales grew 6.8% to $2.49 billion, driven by Westar®, NovaChoice® and Envision® products, partially offset by approximately $47 million in customer incentives received in 2024 that were not repeated in 2025. Contract-Manufactured Products sales rose 4.2% to $582.0 million. GAAP operating profit increased 2.6% to $584.9 million, and net income was $493.7 million, or $6.79 per diluted share, versus $6.69 in 2024. Adjusted operating profit, a non-GAAP measure that excludes unallocated items such as restructuring charges, was $622.4 million (20.2% margin), up 8.7%. Gross margin improved to 35.9% from 34.5%, while SG&A rose 16.3% to $393.6 million, largely on higher incentive compensation. Cash flow and balance sheet strengthened. Operating cash flow was $754.8 million, and cash and cash equivalents ended the year at $791.3 million versus $484.6 million. Total debt was $202.8 million, and the $500.0 million revolving credit facility had no outstanding borrowings at year end. Share repurchases totaled $134.0 million in 2025, down from $560.9 million in 2024. On February 17, 2026, the Board authorized a new $1.0 billion share repurchase program. Capital expenditures were $285.9 million. The company agreed in December 2025 to sell its SmartDose® 3.5mL On-Body Delivery System manufacturing and supply rights to AbbVie for approximately $112.5 million, expected to close in mid-2026. A securities class action filed in May 2025 remains at an early stage, and the company is unable to estimate potential losses.
Feb 17, 2026
2024
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2024
West Pharmaceutical Services, Inc. reported consolidated net sales of $2,893.2 million in 2024, down from $2,949.8 million in 2023, with the decline driven mainly by the Proprietary Products segment, where net sales fell $62.8 million, or 2.6%, to $2,334.5 million. Consolidated operating profit decreased 15.7% to $569.9 million, and gross profit fell 11.6% to $998.5 million as gross margin compressed to 34.5% from 38.3%. Management attributed the Proprietary Products decline to lower plant absorption from reduced customer demand, a shift in product mix, and roughly $47 million in customer incentives earned on 2024 volumes, partially offset by higher sales prices. Net income was $492.7 million, or $6.69 diluted EPS, versus $593.4 million and $7.88 in 2023. Cash flow from operations declined to $653.4 million from $776.5 million, while capital expenditures rose to $377.0 million from $362.0 million to add manufacturing capacity. Cash and cash equivalents fell to $484.6 million from $853.9 million, reflecting $560.9 million of share repurchases and $59.1 million of dividend payments. Total debt was essentially flat at $202.6 million, and the company had $497.6 million of available capacity under its multi-currency revolving credit facility at year end. The company reported that it was in compliance with all debt covenants and that it believes its liquidity is adequate for foreseeable needs. The filing shows sales outside the U.S. at 57.5% of 2024 net sales, and one customer accounted for 12.3% or $356.4 million of consolidated net sales. Management reported effective internal control over financial reporting as of December 31, 2024, and PricewaterhouseCoopers LLP issued an unqualified opinion on both the financial statements and internal controls.
Feb 18, 2025
2023
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2023
West Pharmaceutical Services, Inc. reported net sales of $2,949.8 million for 2023, up 2.2% from $2,886.9 million in 2022, including a favorable foreign currency translation impact of $27.9 million. Excluding currency effects and the impact of a plant disposal ($11.5 million), net sales rose 1.6%. Growth came from Contract-Manufactured Products, where sales rose 15.0% to $552.5 million, while Proprietary Products sales were flat at $2,397.3 million (down 0.4%), with a decline of approximately $320 million in COVID-related sales offset by growth in high-value components and devices. Consolidated operating profit fell 7.9% to $676.0 million, and net income decreased to $593.4 million from $585.9 million in 2022 only because of a $52.2 million pension settlement charge in 2022 that was not repeated; diluted EPS was $7.88 versus $7.73. The company's adjusted operating profit, a non-U.S. GAAP measure, declined 9.4% to $690.6 million, with the adjusted operating profit margin at 23.4% compared with 26.4% in 2022. Cash flow and balance sheet data show net cash from operating activities of $776.5 million, capital expenditures of $362.0 million, and $438.3 million of share repurchases under a $1.0 billion program approved in February 2023. Cash and cash equivalents were $853.9 million at December 31, 2023, and total debt was $206.8 million, of which $134.0 million was classified as current, mainly because the $81.0 million Term Loan and $53.0 million Series B notes mature in 2024. The company had no outstanding borrowings under its $500.0 million Credit Facility, with $497.6 million of borrowing capacity available. Sales outside the U.S. accounted for 58.0% of net sales, and the company reported that its ten largest customers represented 41.4% of consolidated net sales, with one customer accounting for 10.9% or $322.1 million. Management identified inflation, supply chain constraints, foreign currency volatility, the decline in COVID-related demand, and dependence on injectable drug delivery as key risks. The company stated that it did not have any material legal proceedings, that internal control over financial reporting was effective as of December 31, 2023, and that PricewaterhouseCoopers LLP audited the financial statements and internal controls.
Feb 20, 2024
2022
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2022
West Pharmaceutical Services, Inc. reported net sales of $2,886.9 million for 2022, up 2.0% from $2,831.6 million in 2021, with consolidated net sales growing 7.7% excluding foreign currency translation effects. Proprietary Products net sales rose 3.9% to $2,406.8 million, while Contract-Manufactured Products net sales fell 6.7% to $480.4 million. Sales outside the U.S. accounted for 55.4% of net sales in 2022. Consolidated operating profit declined 2.4% to $734.0 million, and consolidated gross profit margin fell to 39.4% from 41.5%, reflecting inflationary headwinds, plant spend and higher labor and overhead costs. Net income decreased to $585.9 million, or $7.73 per diluted share, from $661.8 million, or $8.67 per diluted share, largely due to a $52.2 million pension settlement charge and $23.8 million in restructuring and related charges. Cash flow and balance sheet strength improved. Net cash provided by operating activities rose to $724.0 million from $584.0 million, cash and cash equivalents reached $894.3 million, and total debt fell to $208.9 million from $253.0 million. The company repurchased $202.8 million of its shares in 2022, and in February 2023 its Board approved a new share repurchase program of up to $1.0 billion. Dividends declared were $0.74 per share for 2022 and the Q4 2022 quarterly dividend was $0.19 per share. Management also reports that the Russia-Ukraine conflict has not had a material impact on the company to date, while inflation, raw material costs and supply chain constraints remain key risks. The company's 2022 restructuring plan targets $22 million to $24 million in annualized savings, against restructuring charges of approximately $25 million to $27 million. Management expects its Credit Facility, cash on hand and operating cash flow to meet foreseeable liquidity needs, and it reported no outstanding borrowings under the $500.0 million revolving facility at December 31, 2022.
Feb 21, 2023
2021
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2021
West Pharmaceutical Services, Inc. (NYSE: WST) reported a strong 2021 in its 10-K filed February 22, 2022. Consolidated net sales rose to $2,831.6 million from $2,146.9 million, an increase of 31.9% that the filing attributes largely to the Proprietary Products segment, whose sales grew 40.6% to $2,317.3 million. The filing notes approximately $459 million of COVID-19 related activity in Proprietary Products sales in 2021, versus about $99 million in 2020. Consolidated operating profit increased to $752.3 million from $406.9 million, and net income rose to $661.8 million from $346.2 million. Diluted EPS was $8.67, compared with $4.57 in 2020. Adjusted consolidated operating profit was $762.4 million, a non-U.S. GAAP measure that excludes unallocated items. Cash flow and balance sheet strengthened over the year. Net cash provided by operating activities was $584.0 million, and capital expenditures were $253.4 million, reflecting investment to meet customer demand. Cash and cash equivalents ended the year at $762.6 million, and total debt was $253.0 million. The Credit Facility had no outstanding borrowings at December 31, 2021, with $297.6 million of available borrowing capacity. Working capital increased to $1,147.9 million. Shareholder returns included dividends of $0.70 per share in 2021 and $137.1 million of share repurchases. The Board approved a 2022 repurchase program of up to 650,000 shares. The filing also highlights ongoing risks. Sales outside the U.S. accounted for 57.7% of 2021 consolidated net sales, exposing the company to currency and political risks. The ten largest customers represented 41.4% of net sales. Management flags reliance on injectable drug delivery, single-source raw materials, LIBOR transition, and Daikyo license agreements expiring in 2027. The company reported effective internal control over financial reporting as of December 31, 2021, and PricewaterhouseCoopers LLP issued an unqualified opinion.
Feb 22, 2022
2020
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2020
West Pharmaceutical Services, Inc. reported net sales of $2,146.9 million for 2020, up from $1,839.9 million in 2019, with consolidated net sales increasing by $307.0 million, or 16.7%. Growth was driven mainly by the Proprietary Products segment, whose net sales rose $250.0 million, or 17.9%, to $1,648.6 million, largely on high-value product offerings. The filing states that these offerings included approximately $99 million in COVID-19 related activity for vaccines, antiviral treatments and treatment of underlying COVID-19 symptoms. Contract-Manufactured Products net sales increased $57.1 million, or 12.9%, to $498.6 million. Profitability improved meaningfully. Consolidated operating profit rose to $406.9 million from $296.6 million, and operating profit margin reached 19.0% versus 16.1% in 2019. Net income was $346.2 million, and diluted EPS was $4.57, compared with $3.21 in 2019. Operating cash flow increased to $472.5 million from $367.2 million, while capital expenditures were $174.4 million. Cash and cash equivalents ended the year at $615.5 million, and total debt was $255.2 million. The filing also identifies risks, including concentration in injectable drug delivery, reliance on single-source raw material suppliers, international currency exposure (sales outside the U.S. were 54.6% of 2020 consolidated net sales), and the Vial2Bag recall, which remains under work to return products to market. The company's Board approved a 2021 share repurchase program of up to 631,000 shares, and the quarterly dividend was raised to $0.17 per share in the fourth quarter of 2020.
Feb 23, 2021
2019
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2019
West Pharmaceutical Services, Inc. (NYSE: WST) reported net sales of $1,839.9 million for 2019, up 7.1% from $1,717.4 million in 2018, or 10.0% excluding foreign currency translation effects of $52.2 million and $3.3 million of incremental sales from a recent acquisition. Net income rose to $241.7 million, or $3.21 per diluted share, from $206.9 million, or $2.74 per diluted share, with consolidated operating profit up 23.4% to $296.6 million. Growth was led by the Proprietary Products segment, where net sales rose 6.9% to $1,398.6 million and gross margin improved to 38.6%, while Contract-Manufactured Products net sales rose 7.9% to $441.5 million. Operating cash flow increased to $367.2 million from $288.6 million. The balance sheet strengthened over the year, with cash and cash equivalents of $439.1 million, total assets of $2,341.4 million and total equity of $1,573.2 million. Total debt rose to $257.3 million, driven by a $90.0 million Term Loan, and the company increased its ownership in Daikyo from 25% to 49% in exchange for $85.1 million in cash and $4.9 million in treasury stock. Proprietary Products order backlog grew to $587.9 million at December 31, 2019, from $407.3 million a year earlier. Investors should also note that the filing identifies a voluntary recall of the Vial2Bag product line, ongoing currency exposure (55.7% of 2019 net sales came from outside the U.S.), and continued reliance on single-source raw material suppliers. The company repurchased 800,000 shares for $83.1 million in 2019 and announced a program to repurchase up to 848,000 shares in 2020. Quarterly dividends rose to $0.16 per share in the fourth quarter of 2019, and total 2019 dividends declared were $0.62 per share.
Feb 24, 2020
2018
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2018
West Pharmaceutical Services, Inc. reported 2018 net sales of $1,717.4 million, up 7.4% from $1,599.1 million in 2017, or 5.6% excluding foreign currency translation effects. Net income rose to $206.9 million, or $2.74 per diluted share, from $150.7 million, or $1.99 per diluted share, in 2017. The 2017 result included a $48.8 million discrete tax charge tied to the 2017 Tax Act, while 2018 included a $14.3 million tax benefit from share-based payment accounting and $7.2 million of restructuring and related charges (net of tax). Operating profit increased to $240.3 million, and operating cash flow rose to $288.6 million. The Proprietary Products segment drove growth, with net sales of $1,308.6 million (up 5.8%) and a gross profit margin of 37.1%. Contract-Manufactured Products net sales were $409.1 million (up 12.9%), but its gross profit margin fell to 14.7% from 17.5%. Sales outside the U.S. were 55.4% of consolidated net sales. The company disclosed a voluntary recall of its Vial2Bag product line on January 24, 2019, after a $11.3 million provision for product returns was recorded as a reduction of 2018 sales. Balance sheet and liquidity were strengthened: cash and cash equivalents reached $337.4 million, working capital rose to $610.7 million, and total debt was $196.1 million against total equity of $1,396.3 million. Available capacity under the $300.0 million Credit Facility was $268.9 million. The board also approved an 800,000-share repurchase program for 2019, and dividends declared per share rose to $0.58 from $0.54.
Feb 28, 2019
2017
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2017
West Pharmaceutical Services, Inc. reported net sales of $1,599.1 million in 2017, up $90.0 million, or 6.0%, from $1,509.1 million in 2016, including a favorable foreign currency translation impact of $12.2 million. Operating profit rose to $228.9 million from $196.8 million, and net income was $150.7 million, or $1.99 per diluted share, compared with $143.6 million, or $1.91 per diluted share, in 2016. Results were affected by a $48.8 million discrete tax charge tied to the 2017 Tax Act, a $33.1 million tax benefit from share-based payment accounting guidance, and an $11.1 million charge from deconsolidating the Venezuelan subsidiary. The Proprietary Products segment generated $1,236.9 million of net sales, up 3.9%, while Contract-Manufactured Products grew 13.2% to $362.5 million. Management noted Proprietary Products growth slowed as customers worked down inventory bought in 2016. Sales outside the U.S. were 54.1% of consolidated net sales in 2017. Cash and cash equivalents ended the year at $235.9 million, operating cash flow was $263.3 million, and total debt declined to $197.0 million from $228.6 million. In February 2018, the Board approved a restructuring plan to realign manufacturing capacity with demand, with expected charges of $8.0 million to $13.0 million and annualized savings of $17.0 million to $22.0 million once complete. The Company also announced an 800,000-share repurchase program for 2018 and noted that the Waterford, Ireland facility is expected to begin commercial production in the second half of 2018.
Feb 26, 2018
2016
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2016
West Pharmaceutical Services, Inc. reported 2016 net sales of $1,509.1 million, up 7.8% from $1,399.8 million in 2015, with growth driven by high-value product offerings. Consolidated operating profit rose to $196.8 million from $128.6 million, while net income increased to $143.6 million, or $1.91 per diluted share, compared with $95.6 million, or $1.30 per diluted share, in 2015. The 2016 results absorbed restructuring and related charges of $26.4 million, and 2015 results included a $50.4 million pension settlement charge. The company reorganized into two reportable segments in 2016: Proprietary Products, with net sales of $1,189.9 million, and Contract-Manufactured Products, with net sales of $320.2 million. Sales outside the U.S. were 51.1% of consolidated net sales in 2016, and the filing highlights currency translation, which reduced 2016 net sales by $17.5 million. Cash and cash equivalents were $203.0 million at year-end, total debt declined to $228.6 million from $298.2 million, and operating cash flow was $219.4 million. Looking ahead, the company announced a share repurchase program of up to 800,000 shares to run from January 1, 2017 through December 31, 2017, and plans to freeze its U.S. defined benefit pension plans as of January 1, 2019. A new facility in Waterford, Ireland, is expected to begin commercial production in 2018. Management also cites risks including reliance on injectable drug delivery, currency exposure, raw material price volatility, and pricing pressure from customers.
Feb 28, 2017
2015
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2015
West Pharmaceutical Services, Inc. (NYSE: WST) is a manufacturer of components and systems for the packaging and delivery of injectable drugs, operating two reportable segments in 2015: Pharmaceutical Packaging Systems and Pharmaceutical Delivery Systems. Consolidated net sales were $1,399.8 million in 2015, down from $1,421.4 million in 2014, with unfavorable foreign currency effects of $123.9 million. Excluding currency effects, the filing states net sales increased 7.2%. Consolidated operating profit fell to $128.6 million from $182.0 million, mainly due to a $50.4 million pension settlement charge and a $10.9 million executive retirement charge. Net income was $95.6 million, or $1.30 per diluted share, versus $127.1 million, or $1.75 per diluted share, in 2014. Operating cash flow rose to $212.4 million from $182.9 million. The company ended 2015 with $274.6 million of cash and cash equivalents, total debt of $298.2 million, and total equity of $1,023.9 million. Net debt-to-total invested capital improved to 2.3% from 7.7%. Packaging Systems net sales were $1,000.7 million and Delivery Systems net sales were $400.2 million. Management stated the company will move to Proprietary Products and Contract-Manufactured Products reportable segments beginning in 2016, and the board approved a restructuring plan in February 2016 with a 2016 charge of $23.0 million to $28.0 million. The filing also flags currency exposure, with 52.0% of 2015 consolidated net sales generated outside the U.S., and a Venezuelan Bolivar devaluation in February 2016 with an estimated pre-tax charge of $2.3 million in the first quarter of 2016. Dependence on injectable drug delivery, pricing pressure, and reliance on licenses from affiliate Daikyo, which expire in 2017, are cited as key risks.
Feb 26, 2016
2014
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2014
West Pharmaceutical Services, Inc. reported 2014 net sales of $1,421.4 million, up 3.9% from $1,368.4 million in 2013, with net income of $127.1 million, or $1.75 per diluted share, compared with $112.3 million, or $1.57 per diluted share, in 2013. Operating profit rose 12.1% to $182.0 million, and operating margin improved to 12.8% from 11.9%. Gross margin slipped to 31.5% from 31.8%. Packaging Systems net sales grew 2.4% to $1,019.7 million, while Delivery Systems grew 7.6% to $402.5 million, with proprietary net sales representing 26.2% of Delivery Systems sales. The balance sheet strengthened, with total debt falling to $336.7 million from $373.5 million and net debt-to-total invested capital declining to 7.8% from 13.7%. Cash and cash equivalents rose to $255.3 million, and operating cash flow was $182.9 million, down from $220.5 million, largely due to a $27.2 million increase in pension contributions and the absence of a $20.0 million customer payment received in June 2013. Management flagged that translation of non-U.S. dollar sales is expected to adversely affect 2015 sales and net income per share, and noted a $100.0 million share repurchase authorization approved in October 2014 with no shares repurchased as of year-end. The Board also approved a quarterly dividend increase to $0.11 per share beginning in the fourth quarter of 2014. Leadership transition is a key watch item: Chairman and CEO Donald E. Morel, Jr. announced his intention to retire at the May 2015 annual meeting, and the Board has launched a search for his successor. Sales outside the U.S. accounted for 54% of 2014 consolidated net sales, and the company cited ongoing risks from currency fluctuations, Venezuelan currency restrictions, and reliance on injectable drug products.
Feb 25, 2015
2013
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2013
West Pharmaceutical Services, Inc. (NYSE: WST) is a manufacturer of components and systems for the packaging and delivery of injectable drugs, organized into two reportable segments: Pharmaceutical Packaging Systems and Pharmaceutical Delivery Systems. For 2013, net sales were $1,368.4 million, up 8.0% from 2012, and net income was $112.3 million, or $1.57 per diluted share, compared with $80.7 million, or $1.15 per diluted share, in 2012. Operating profit rose to $162.4 million, with operating profit margin of 11.9%, and gross margin improved to 31.8%. Packaging Systems drove most of the growth, with net sales of $996.0 million and operating profit of $217.0 million, while Delivery Systems' operating profit fell to $9.4 million from $18.4 million. Cash flow and balance sheet strengthened over the year. Net cash provided by operating activities was $220.5 million, cash and cash equivalents rose to $230.0 million, and total debt declined to $373.5 million from $411.5 million. Net debt-to-total invested capital fell to 13.7% from 25.5%. The company also doubled its share count through a two-for-one stock split in September 2013 and raised its quarterly dividend to $0.10 per share in the fourth quarter of 2013. Management anticipates continued revenue and margin improvement in 2014, driven by demand for higher-quality products and a rising share of proprietary Delivery Systems products. Key risks disclosed include dependence on injectable drug delivery, pricing pressure, currency exposure (55% of 2013 net sales came from outside the U.S.), reliance on single-source raw materials, FDA regulatory timelines, and the expiration of Daikyo license agreements in 2017. The Packaging Systems order backlog was $336.6 million at December 31, 2013, down from $349.1 million, and management expects the entire backlog to be filled during 2014.
Feb 27, 2014
2012
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2012
West Pharmaceutical Services, Inc. reported net sales of $1,266.4 million for 2012, up from $1,192.3 million in 2011, with consolidated net sales increasing by 6.2% (10.1% excluding foreign currency effects). Operating profit rose to $135.1 million from $109.6 million, and net income was $80.7 million, or $2.30 per diluted share, compared with $75.5 million, or $2.16 per diluted share, in 2011. Gross margin improved to 30.6% from 28.5%, driven mainly by sales price increases and a favorable product mix, with the Packaging Systems segment (net sales of $915.1 million) generating most of the operating profit at $187.5 million. The company's balance sheet and cash generation strengthened over the year. Net cash provided by operating activities was $187.4 million, versus $130.7 million in 2011, and cash and cash equivalents ended the year at $161.9 million. Total debt rose to $411.5 million from $349.4 million, largely from the June 2012 repurchase of $158.4 million of Convertible Debentures and the July 2012 issuance of $168.0 million in senior unsecured notes. Net debt-to-total invested capital improved to 25.5% from 28.2%. Management's 2013 outlook anticipates continued revenue improvement from higher-value closure products and proprietary delivery systems, with capital spending of up to $150 million, excluding about $35 million tied to the new corporate office and research building. The order backlog was $354.0 million at December 31, 2012, all expected to be filled in 2013, up from $289.8 million a year earlier. Key risks cited include reliance on injectable drug products, pricing pressure, currency exposure (53% of sales outside the United States), raw material costs, and regulatory approval timelines.
Feb 27, 2013
2011-A
West Pharmaceutical Services Annual Report (Amendment), Year Ended Dec 31, 2011
This Form 10-K filing from West Pharmaceutical Services, Inc. contains Item 6 (Exhibits) and the Exhibit Index. It lists the agreements, plans, certifications, and XBRL documents that accompany the annual report, and it does not contain financial statements or narrative business disclosure. Most exhibits are incorporated by reference to earlier filings, including Forms 8-K, 10-K, and 10-Q. The index points to several items of note for investors. The Credit Agreement and Security Agreement, both dated June 3, 2011, were entered into with PNC Bank, National Association, as administrative agent. A Global Supply Agreement with ExxonMobil Chemical Company, entered July 28, 2011, covers the period from January 1, 2011 through December 31, 2013. The company also filed a Lease Agreement dated December 17, 2010 with 530 Regency Drive Associates, L.P., along with a letter exercising a purchase option. Its 2011 Omnibus Incentive Compensation Plan and a Change-in-Control Agreement with Jeffrey C. Hunt dated January 21, 2011 are also listed. The index also includes the Computation of Ratio of Earnings to Fixed Charges (Exhibit 12.1), the Subsidiaries of the Company (Exhibit 21), the Consent of Independent Registered Public Accounting Firm (Exhibit 23), and Powers of Attorney (Exhibit 24). Section 302 and Section 906 certifications from the CEO and CFO are included, as are XBRL instance and taxonomy documents. Certain portions of the Goodyear, Becton Dickinson, and ExxonMobil agreements have been omitted under a confidential treatment request submitted to the SEC.
Mar 1, 2012
2011
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2011
West Pharmaceutical Services, Inc. (WST) reported net sales of $1,192.3 million for 2011, up 7.9% from $1,104.7 million in 2010 (5.2% excluding foreign currency effects). Operating profit rose to $109.6 million from $90.7 million, and net income was $75.5 million, or $2.16 per diluted share, compared with $65.3 million, or $1.89 per diluted share, in 2010. Growth was driven by sales volume, sales price increases and a favorable foreign exchange impact of $30.2 million, while gross margin slipped to 28.5% from 28.8% because of higher raw material costs. Packaging Systems, the larger segment with $857.4 million in net sales, grew 9.2%, while Delivery Systems grew 3.9% to $336.7 million. Management describes its 2012 outlook as positive, anticipating continued revenue improvement in high-value packaging and prefilled syringe components, modest growth from proprietary devices such as SmartDose, and planned 2012 capital spending of approximately $135 million to $155 million. Cash flow from operations was $130.7 million, and total debt was $349.4 million at year-end, against cash and cash equivalents of $91.8 million. The company also raised its quarterly dividend to $0.18 per share in the fourth quarter of 2011 and reported a $289.8 million order backlog at December 31, 2011. Key risks flagged in the filing include raw material and energy price volatility, pricing pressure from customers and competitors, dependence on injectable drug products, regulatory approval timelines, and international currency exposure, with more than half of revenue generated outside the United States.
Feb 29, 2012
2010
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2010
West Pharmaceutical Services, Inc. reported net sales of $1,104.7 million for 2010, up from $1,055.7 million in 2009, with net income of $65.3 million, or $1.89 per diluted share, compared with $72.6 million, or $2.12 per diluted share, in the prior year. Operating profit fell to $90.7 million from $97.5 million, mainly due to higher restructuring and related charges tied to a December 2010 plan to close a plant in Montgomery, Pennsylvania and reduce operations in St. Austell, England. Management described the company's financial position as very strong, with operating cash flow of $138.3 million and total debt reduced to $358.4 million from $379.6 million. The company operates two segments: Pharmaceutical Packaging Systems, which generated $785.0 million of 2010 net sales, and Pharmaceutical Delivery Systems, which generated $324.1 million. Sales outside the U.S. were approximately 52% of consolidated net sales. Order backlog was $250.6 million at December 31, 2010, all expected to be filled during 2011. Management expects 2011 capital spending of $110 million to $130 million and a 2011 effective tax rate of approximately 24%. Investors should note the 2011 outlook calls for continued revenue improvement, tempered by a slow global economic recovery, customer consolidation and uncertainty over U.S. healthcare reform. The company also disclosed a February 25, 2011 exercise of its option to purchase a new global headquarters building, with an estimated purchase price of approximately $39.0 million, including transaction fees.
Feb 28, 2011
2009
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2009
West Pharmaceutical Services, Inc. reported net sales of $1,055.7 million for 2009, essentially flat versus $1,051.1 million in 2008. Excluding foreign currency effects, net sales rose $37.1 million, or 3.5%. Operating profit fell to $97.5 million from $124.1 million, reflecting higher U.S. pension expense ($16.7 million versus $6.0 million), restructuring and other unallocated charges of $8.5 million, and unfavorable currency translation. Net income from continuing operations was $72.6 million, or $2.12 per diluted share, compared with $86.0 million, or $2.50 per diluted share, in 2008. Operating cash flow rose to $137.7 million from $135.0 million. The company's total debt was $379.6 million at year-end 2009, down from $386.0 million, and the net debt-to-total invested capital ratio improved to 33.9% from 38.0%. Cash and cash equivalents were $83.1 million, and $174.5 million of borrowing capacity remained under the $200.0 million revolving credit agreement, which expires in February 2011. Capital spending was $104.9 million in 2009, and management expects 2010 capital spending of $115 million to $130 million. The order backlog was $238.7 million at December 31, 2009. Effective January 1, 2010, West realigned its operations into two divisions, Pharmaceutical Packaging Systems and Pharmaceutical Delivery Systems, and management expects full-year 2010 revenues to grow moderately and operating profit to increase. Risks flagged in the filing include global economic conditions, pricing pressure, raw material and energy costs, international currency exposure, and potential U.S. healthcare legislation.
Feb 25, 2010
2008
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2008
West Pharmaceutical Services, Inc. reported net sales of $1,051.1 million for fiscal 2008, up from $1,020.1 million in 2007, with growth driven mainly by favorable foreign currency translation and price increases, partly offset by lost sales of $63 million from regulatory and insurance reimbursement constraints and discontinued products. Income from continuing operations rose to $86.0 million, or $2.50 per diluted share, versus $71.2 million, or $2.06 per diluted share, in 2007. Operating profit increased to $124.1 million from $94.9 million, with 2007 burdened by $26.4 million of unallocated charges, including the Exubera-related Nektar impairment and Brazilian tax provisions. The Pharmaceutical Systems segment generated sales of $792.1 million, up 6.8%, while the Tech Group segment's sales fell 6.5% to $270.5 million after the loss of Exubera device business. Operating cash flow was $135.0 million, and total debt was $386.0 million, with net debt-to-total invested capital of 38.0%. Pension performance weakened, with the U.S. pension assets declining 25% and the net pension underfunded balance rising to $73.0 million from $14.8 million. Management's 2009 outlook calls for consolidated sales of $1.01 billion to $1.03 billion, a reduction of 2% to 4% from 2008 after an expected unfavorable currency impact of approximately 7%, and projects roughly $10 million of incremental pension expense. Capital spending is budgeted at approximately $140.0 million, and R&D spending is expected to rise about 25%.
Feb 27, 2009
2007
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2007
West Pharmaceutical Services, Inc. reported record 2007 consolidated net sales of $1,020.1 million, exceeding $1 billion for the first time in its history, up from $913.3 million in 2006. Net income was $70.7 million, or $2.05 per diluted share, compared with $67.1 million in 2006. Income from continuing operations was $71.2 million, while operating profit declined to $94.9 million from $101.0 million, reflecting $26.4 million of pre-tax restructuring, impairment and Brazilian tax charges. The Pharmaceutical Systems segment drove growth, with net sales of $741.8 million and operating profit of $141.9 million, while the Tech Group segment's sales rose to $289.2 million but its operating profit fell to $11.6 million. The Tech Group was hurt by Pfizer's October 2007 decision to discontinue marketing Exubera®, which led to a $12.9 million impairment of the related Nektar contract intangible asset and a December 2007 restructuring plan with estimated charges of approximately $12.0 million. Management expects 2008 Pharmaceutical Systems sales growth of approximately 7% and a 2008 capital spending budget of approximately $140 million, and it anticipates Tech Group sales to decline about 7% in 2008 as Exubera® revenue ends. Balance sheet leverage increased during the year. Total debt rose to $395.1 million from $236.3 million, mainly due to $161.5 million of 4% convertible junior subordinated debentures due 2047, and the net debt-to-total invested capital ratio reached 36.9% versus 31.1% a year earlier. Cash and cash equivalents increased to $108.4 million. The company also repurchased 980,300 shares for $39.4 million under its August 2007 program and announced on February 27, 2008 that it does not intend to make further repurchases.
Feb 29, 2008
2006
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2006
West Pharmaceutical Services, Inc. reported net sales of $913.3 million for fiscal 2006, up 30.5% from $699.7 million in 2005. Operating profit rose to $101.0 million from $73.4 million, and net income was $67.1 million, or $2.00 per diluted share, compared with $46.4 million in 2005. Income from continuing operations was $61.5 million, or $1.83 per diluted share. Growth was driven by the Pharmaceutical Systems segment, where net sales reached $644.1 million, and by the Tech Group segment, which grew to $279.2 million, helped by the 2005 acquisitions of Monarch, Tech Group Inc. (TGI) and Medimop. Acquisition timing contributed 13.4 percentage points of the sales increase. Management cites rising demand for injectable and biotech drugs and expects 2007 capital spending of approximately $130 million, including new capacity in China. Balance sheet and cash flow improved during the year. Operating cash flow was $139.4 million, and corporate cash flow was $33.2 million. Total debt fell to $236.3 million from $281.0 million, and the debt-to-total-invested-capital ratio was 36.0%, down from 45.0%. The company prepaid $100.0 million of 6.81% senior notes in February 2006, financed with new euro-denominated notes, and recorded a $5.9 million pretax loss on the extinguishment. Shareholders' equity rose to $414.5 million, although the adoption of SFAS 158 reduced equity by $19.7 million. Return on invested capital was 11.2%. The filing also flags risks. Management says the company depends on injectable drug delivery, faces pricing pressure, relies on single-source suppliers for many critical raw materials, and is exposed to raw material and energy costs. About 49% of consolidated net sales come from outside the U.S. The company also notes that its European plants were operating at or near 100% of capacity, and that on-time delivery has declined because of capacity constraints.
Mar 1, 2007
2005
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2005
West Pharmaceutical Services, Inc. reported net sales of $699.7 million for fiscal 2005, up from $541.6 million in 2004, with the filing stating that sales grew 29.2%, of which acquisitions contributed 19.7 percentage points and foreign exchange 0.5 percentage points. Operating profit rose to $72.2 million from $48.2 million, and net income was $45.6 million, or $1.40 per diluted share, compared with $19.4 million in 2004. Income from continuing operations was $45.2 million, or $1.39 per diluted share. Gross margin declined to 27.5% from 28.8%, which management attributed largely to lower-margin revenue from the acquired Tech Group business. Excluding acquisitions and currency effects, net sales rose 9.0%. The year was dominated by acquisitions: The Tech Group, Inc. (TGI) for $140.5 million, Medimop Medical Projects for $40.0 million total consideration, and Monarch Analytical Laboratories. Total debt rose to $281.0 million from $160.8 million, and the debt-to-total-invested-capital ratio increased to 45.4% from 34.8%. Management expects 2006 revenues of $810 to $830 million and diluted earnings of $1.60 to $1.70 per share. In February 2006, the company refinanced its $100 million 6.81% senior notes with euro-denominated notes at a weighted average rate of 4.34%, and it amended its revolving credit facility to $250 million. The filing also discloses risks, including a Puerto Rico environmental notice of potential CERCLA liability at a former facility, the February 2006 settlement of Kinston plant explosion litigation, and reliance on single-source raw material suppliers. Becton, Dickinson and Company was the largest customer at approximately 11% of 2005 net sales.
Mar 6, 2006
2004
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2004
West Pharmaceutical Services, Inc. reported net sales of $541.6 million for 2004, up 12% from $483.4 million in 2003, with about 5% of the increase attributed to the strengthening of the Euro and other currencies against the U.S. dollar. Net income fell to $19.4 million from $31.9 million, driven largely by discontinued operations: a $14.1 million net loss from discontinued operations and a $4.7 million pre-tax loss on the disposal of the drug delivery business. Income from continuing operations was $33.5 million, or $1.09 per diluted share, versus $42.9 million, or $1.48 per diluted share, in 2003. The 2003 figure included a $17.3 million net gain from the Kinston insurance settlement, while 2004 absorbed $11.6 million of incremental manufacturing costs tied to interim production after the Kinston explosion. Gross margin declined to 28.8% from 31.7%, and the company expects gross margin to improve to approximately 30% in 2005. In December 2004 West agreed to sell its drug delivery business to Archimedes Pharma Limited for $7.1 million in cash and assumed indebtedness, plus a 14% ownership interest in Archimedes and 3% of future royalty income. The company also plans to exit its clinical services unit in Evansville, Indiana. Both businesses are presented as discontinued operations. Order backlog rose to $152.7 million at December 31, 2004, from $131.6 million a year earlier. Total debt declined to $160.8 million, and debt to total invested capital improved to 34.8% from 40.5%. Cash from operations was $81.0 million, and capital expenditures were $57.4 million, with 2005 capital spending expected to be approximately $50.0 million. The Board approved in March 2005 a plan to repatriate up to $70 million under the American Jobs Creation Act of 2004, with the first-quarter 2005 tax expense estimated at $2 million to $4 million, or $0.06 to $0.13 per diluted share. Lawsuits related to the January 2003 Kinston explosion, which resulted in six deaths, remain pending, and the company believes its insurance is sufficient to cover expected losses from the litigation.
Mar 9, 2005
2003
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2003
West Pharmaceutical Services, Inc. reported consolidated net sales of $490.7 million for 2003, up from $419.7 million in 2002 and $392.3 million in 2001, and net income of $31.9 million, or $2.19 per diluted share, compared with $18.4 million in 2002. Operating profit rose to $54.5 million from $26.7 million, helped by a $17.3 million net gain from the final settlement of the insurance claim for the January 2003 explosion and fire at the Kinston, North Carolina plant, which resulted in six deaths. Results also absorbed a $7.0 million charge tied to the U.K. device plant. Pharmaceutical Systems, the core closures and components business, generated $483.4 million of net sales and $88.2 million of operating profit, while Drug Delivery Systems posted an operating loss of $17.5 million. The company's balance sheet strengthened over the year. Total assets grew to $623.6 million and shareholders' equity rose to $257.6 million, while total debt was $175.0 million, equal to 40.5% of total invested capital, a 6.0 percentage point improvement from year-end 2002. Cash flow from operations was $69.2 million, against capital spending of $60.8 million, including $14.1 million for the Kinston rebuild. The filing states that full production capacity at Kinston is expected to return to historical levels by September 2004, and that higher production costs of approximately $10 million to $12 million are expected in 2004. Key risks flagged in the filing include a $100.0 million senior notes obligation and a revolving credit facility maturing in July 2005, with refinancing anticipated in the second quarter of 2004. Becton Dickinson accounted for approximately 12% of 2003 consolidated net sales, and sales outside the United States were approximately 50%. A wrongful-death-type lawsuit tied to the Kinston explosion remains pending in state court, and the company states it believes its insurance is sufficient to cover expected litigation losses. The Drug Delivery Systems segment, which develops nasal and oral delivery technologies, remains loss-making, with management prioritizing near-term licensing opportunities.
Mar 12, 2004
2002
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2002
West Pharmaceutical Services, Inc. (the Company) reported 2002 net sales of $419.7 million, up from $392.3 million in 2001 and $372.5 million in 2000. Operating profit fell to $26.7 million from $39.9 million, reflecting a $9.9 million restructuring charge, and net income from continuing operations was $12.8 million, or $0.89 per share, versus $19.7 million, or $1.38 per share, in 2001. Net income was $18.4 million, or $1.28 per share, helped by a $5.6 million gain from discontinued operations that included a $5.9 million tax benefit. The Pharmaceutical Systems segment drove results, with net sales of $412.8 million and segment operating profit of $65.4 million, while the Drug Delivery Systems segment posted an operating loss of $15.1 million and sales of only $6.9 million. The most significant post-year-end event was an explosion and fire on January 29, 2003 at the Kinston, N.C. plant, which killed six people and caused substantial damage to the building, machinery, equipment and inventories. The Company expects up to $5 million of sales to be delayed in the first and second quarters of 2003, expects pre-tax costs of $4.0 million to $6.0 million net of insurance recoveries in the first half of 2003, and says it is confident that property and business interruption losses, apart from these costs, are fully insured. A lawsuit filed February 24, 2003 seeks unspecified compensatory and punitive damages, and the Company cannot yet estimate the ultimate impact of liability claims. Balance sheet figures show total assets of $536.8 million, total debt of $175 million and shareholders' equity of $201.5 million at December 31, 2002, with debt at 46.5% of total invested capital. Cash flow from operations was $45.7 million, and capital spending was $37.7 million, with 2003 capital spending expected to be about $45 million. Becton Dickinson and Company accounted for approximately 13% of 2002 consolidated net sales.
Mar 26, 2003
2001-A
West Pharmaceutical Services Annual Report (Amendment), Year Ended Dec 31, 2001
West Pharmaceutical Services, Inc. (WST) filed this annual report on Form 10-K for fiscal 2001, describing a company that applies value-added technologies to bringing drug therapies and healthcare products to global markets. The company operates in two segments: Pharmaceutical Systems, which makes elastomer stoppers, metal seals, and other drug packaging and device components, and Drug Delivery Systems, which develops proprietary drug delivery technologies and provides clinical and consumer research services. At December 31, 2001, the company had 3,960 employees. Business Becton Dickinson and Company accounted for approximately 13% of 2001 consolidated net sales. During 2001 the company sold its contract manufacturing and packaging business unit to DPT Lakewood, Inc. for $29.8 million ($28 million in cash and a $1.8 million note due in 2003), recording a net loss of $25.2 million, or $1.76 per share. The company consolidated into two operating segments following the sale and used the proceeds to repay outstanding debt. It recorded a net restructuring charge of $2.9 million in 2001, following a $15.0 million restructuring charge in 2000. At December 31, 2001, Pharmaceutical Systems order backlog was approximately $105 million, compared with approximately $92 million at the end of 2000, and Drug Delivery Systems backlog was $4.1 million, compared with $6.5 million a year earlier. The company's financial statements are incorporated by reference from its 2001 Annual Report to Shareholders, which is not reproduced in this filing.
Aug 29, 2002
2001
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2001
West Pharmaceutical Services, Inc. reported 2001 net sales of $396.9 million, up from $378.6 million in 2000, with the filing noting that the strong U.S. dollar reduced reported sales by approximately $8 million and that sales at constant exchange rates were 7% higher. Income from continuing operations was $19.6 million, or $1.37 per share, compared with $12.7 million, or $0.88 per share, in 2000. However, the company posted a net loss of $5.2 million, or $(0.36) per share, because of a $25.2 million loss on the November 2001 sale of its contract manufacturing and packaging business, which was treated as discontinued operations. Results also included a net restructuring charge of $2.9 million. The Pharmaceutical Systems segment generated $376.4 million of net sales and operating profit of $69.2 million, while the Drug Delivery Systems segment's sales rose 31% to $20.5 million, driven mainly by licensing revenue tied to its chitosan-based nasal delivery technology (ChiSys). Gross margin was 29%, unchanged from 2000 but below 1999's 34%, with management citing production inefficiencies at several European plants. Selling, general and administrative expenses rose to $73.4 million, reflecting a $6 million decline in pension income. Balance sheet and cash flow measures show cash of $42.1 million, debt of $193 million (down from $199.4 million), and a debt-to-total-invested-capital ratio of 52.2%. Operating cash flow fell to $31.1 million from $45.8 million, and capital spending was $44.1 million, with about $40 million projected for 2002. The company's most restrictive credit covenant requires a minimum debt-to-total-capital ratio of 55%, which investors should monitor given the current ratio.
Mar 28, 2002
2000
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 2000
West Pharmaceutical Services, Inc. (formerly The West Company, Incorporated) reported a sharp earnings decline for 2000. Net sales were $430.1 million, down from $469.1 million in 1999, and net income fell to $1.6 million, or $.11 per share, from $38.7 million, or $2.59 per share, in 1999. The result includes a pre-tax restructuring charge of $20.8 million taken in the fourth quarter, tied to plant closures in Puerto Rico, the closure of a sterile-fill operation in Lakewood, New Jersey, and the closure of the clinical services site management organization. The Company also recognized an unusual $1.5 million tax benefit in 2000. Excluding the items noted in the filing, the Company cites 2000 net income of $15.5 million, or $1.08 per share, compared with $36.3 million, or $2.44 per share, in 1999. The weakness was concentrated in the Contract Services segment, where sales declined 20.5% from 1999 and operated below breakeven margins. Device Product Development sales were broadly flat at constant exchange rates, with domestic sales down 5.6% and international sales up 5.1%. Gross margin fell to 24.0% from 30.8%. Balance sheet leverage increased: consolidated debt rose to $199.4 million from $171.1 million, and total debt to total invested capital was 49.2%. Cash flow from operations fell to $48.6 million from $69.4 million, and capital spending rose to $57.3 million. The Company has engaged UBS Warburg LLC to review strategic alternatives, which may include asset dispositions or business combinations. For 2001, management projects capital expenditures of about $60 million, focused on completing capacity expansion at two European plants and installing an enterprise resource planning system. The Company also disclosed a $135 million revolving credit agreement signed in July 2000 and a $100 million senior note issued in 1999.
Mar 30, 2001
1999
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 1999
West Pharmaceutical Services, Inc. (filed under the name West Pharmaceutical Services, Inc., formerly The West Company, Incorporated) reported 1999 net sales of $469.1 million, up from $449.7 million in 1998, and net income of $38.7 million, or $2.59 per share, compared with $6.7 million, or $.41 per share, in 1998. The 1999 result includes net tax benefits of $2.3 million, a $4.2 million write-off of a plastic product line that had not gained market acceptance, and a $3.5 million reversal of part of the 1996 restructuring charge. The 1998 result included a $28.2 million charge for acquired in-process research and development from the DanBioSyst UK acquisition. Excluding these items, net income was $36.3 million, or $2.44 per share, versus $37.4 million, or $2.28 per share, in 1998. The company operates three segments: Device Product Development (the largest, with $384.0 million of 1999 net sales), Contract Services ($83.8 million), and Drug Delivery Research and Development ($1.3 million). The company stated that it expects a decline in earnings in the first half of 2000, with a significant decline in first-quarter earnings versus the same periods in 1999. Management cited the time required to secure additional contract services projects and no significant revenue from drug delivery research and development. Contract manufacturing and packaging sales fell 11% in 1999, and the Clinical Services business acquired in April 1999 added $10.1 million to 1999 sales. Cash flow from operations was $69.4 million, and total debt rose to $171.1 million at year-end 1999 from $141.1 million, following a $100 million, 10-year private debt placement. The company's revolving credit agreement expires in August 2000, and discussions for a replacement facility had begun.
Mar 30, 2000
1998
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 1998
West Pharmaceutical Services, Inc. (formerly The West Company, Incorporated) reported net sales of $449.7 million in 1998, compared with $452.5 million in 1997, and net income of $6.7 million, or $.41 per share, versus $44.4 million, or $2.69 per share, in 1997. Results were affected by a $28.2 million charge for acquired in-process research and development tied to the 1998 acquisition of DanBioSyst UK Ltd. and a $2.5 million net restructuring charge in the third quarter of 1998. Excluding these items, the company states 1998 net income was $37.4 million, or $2.28 per share. The company operates three segments: Device Product Development, Contract Services, and Drug Delivery Research and Development. Device Product Development accounted for $365.6 million of 1998 net sales, Contract Services for $82.6 million, and Drug Delivery Research and Development for $1.5 million. Balance sheet and cash flow data show total assets of $505.6 million, total debt of $141.1 million, and shareholders' equity of $230.1 million at year-end 1998, down from $277.7 million the prior year after a $60.4 million Dutch Auction self-tender repurchasing two million shares at $30 per share. Cash flow from operations was $71.0 million, capital expenditures were $41.8 million, and cash dividends totaled $9.4 million ($.61 per share). Management cites weaker demand in domestic healthcare and consumer markets and in Asian and South American markets, while contract manufacturing and packaging sales rose 3% for the full year and 16% in the second half. The company stated it was negotiating a substantial long-term debt facility with a group of insurance companies, with agreement expected in the second quarter of 1999.
May 6, 1999
1997
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 1997
The West Company, Incorporated (now West Pharmaceutical Services, Inc.) reported net sales of $452.5 million in 1997, a decrease of $6.3 million, or 1%, from $458.8 million in 1996. Over 85% of revenue came from healthcare markets, mainly sales to large multinational pharmaceutical and medical device companies. The company is described as the world's largest independent manufacturer of stoppers for sealing drug vials, and it also provides contract packaging and contract manufacturing through its Paco Pharmaceutical Services subsidiary. Net income was $44.4 million, or $2.69 per share, which includes a $7.9 million net tax benefit mainly tied to a tax reorganization of German subsidiaries. Excluding that benefit, net income was $36.5 million, or $2.21 per share, compared with $31.3 million, or $1.91 per share, in 1996 excluding the restructuring charge. Gross margin improved to 29.2% in 1997 from 27.5% in 1996, and gross profit rose to $132.1 million. Management noted that customer cost-reduction programs and increasing price pressure are making results harder to predict, and that soft sales demand is expected to continue in the first half of 1998. Total debt declined to $89 million at year-end 1997 from $98.4 million, and cash flow from operations was $67.7 million. Capital expenditures of $34.4 million were made in 1997, and 1998 capital project cash requirements are estimated at $45 million. The company also reported a 1996 restructuring charge of $21.5 million, covering the closure or downsizing of six manufacturing facilities and an approximate 5% workforce reduction. Becton Dickinson and Company accounted for approximately 11% of 1997 consolidated net sales. Asia/Pacific demand declined amid the regional financial crisis, while direct sales to that region represented approximately 5% of consolidated sales.
Apr 1, 1998
1996
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 1996
The West Company, Incorporated filed this annual report on Form 10-K for the fiscal year ended December 31, 1996. The company operates in one industry segment, making products and providing services for packaging and delivery of healthcare and consumer products. Its core lines are pharmaceutical packaging components such as rubber stoppers, aluminum seals, and Counter Cap products, plus components for medical devices such as syringe parts and blood-sampling components. It also makes plastic closures for consumer products and provides contract packaging and manufacturing through its Paco Pharmaceutical Services subsidiary, acquired in 1995 for $52.4 million. The annual report states that over 85% of revenues come from healthcare markets. Financially, 1996 net sales were $458.8 million, up $45.9 million, or 11%, from $412.9 million in 1995. Net income was $16.4 million, or $1.00 per share, after a $15 million net restructuring charge taken in the first quarter. Excluding that charge, net income was $31.3 million, or $1.91 per share, compared with $28.7 million, or $1.73 per share, in 1995. Gross margin fell to 27.5% from 28.6%, which management attributed mainly to the full-year consolidation of lower-margin Paco operations. Cash flow from operations was $63.4 million, and debt was reduced from $114.3 million to $98.4 million. The restructuring plan announced in March 1996 covers closing or downsizing six manufacturing facilities and cutting about 5% of the workforce, with a total estimated charge of $21.5 million before tax. The company also reported a pending lawsuit by OCAP Acquisition Corp. against Paco and its former parent. The trial court dismissed the plaintiff's claims, and both sides have appealed. Management does not expect a material adverse effect, and R.P. Scherer has agreed to indemnify Paco.
Mar 31, 1997
1995
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 1995
The West Company, Incorporated (now West Pharmaceutical Services, Inc.) reported 1995 net sales of $412.9 million, up 13% from $365.1 million in 1994, driven by the April 1995 acquisition of Paco Pharmaceutical Services and stronger European currencies, which added $10.6 million. Excluding those two items, the filing states consolidated net sales were slightly lower than in 1994, as healthcare customers pressed for lower prices and shifted to lower-priced alternative packaging. Net income rose to $28.7 million, or $1.73 per share, from $27.3 million, or $1.70 per share, while the gross margin fell to 28.6% from 32.1%. The company's balance sheet grew substantially. Total debt rose to $114.3 million from $57.8 million, and total assets reached $480.1 million. Cash from operations was $46.1 million, and the company spent $32.9 million on fixed asset acquisitions and tooling advances. Management describes the financial position as strong and says it can finance substantial future growth. Debt to total invested capital was 31%, and the working capital ratio was 2.4 to 1. The most significant subsequent event is a restructuring approved on March 28, 1996. It calls for closing or substantially downsizing six manufacturing facilities and cutting about 5% of the workforce, and it will withdraw the company from its machinery systems business. The estimated net charge is $15 million after $6.5 million of tax benefits, and the company expects to report a net loss for the first quarter of 1996. Implementation is to be substantially complete by the end of the first quarter of 1997.
Mar 29, 1996
1994-A
West Pharmaceutical Services Annual Report (Amendment), Year Ended Dec 31, 1994
The West Company, Incorporated filed this 10-K on October 20, 1995 for fiscal 1994. The company operates in one industry segment, designing and manufacturing elastomer, metal, glass and plastic stoppers, closures, containers and medical device components for the health care and consumer products markets. Net sales were $365.1 million in 1994, up from $348.7 million in 1993, and net income was $27.3 million, or $1.70 per share, compared with $23.5 million, or $1.48 per share, in 1993. Gross margin improved to 31.8%, and management described the financial position as strong, with year-end working capital of $50.4 million and total debt of $57.8 million. The filing highlights several growth and risk items. Becton Dickinson and Company accounted for about 11% of 1994 consolidated net sales. The company completed several acquisitions in 1994, including Senetics, Inc., a 51% interest in Schubert Seals A/S, and the remaining minority interests in five European subsidiaries. In a subsequent event, the company agreed on March 24, 1995 to acquire Paco Pharmaceutical Services, Inc. for $12.25 per share in cash, a purchase price of approximately $54 million. Management expects 1995 capital project cash requirements of about $44 million and environmental cleanup requirements not exceeding $1 million. The company also noted exposure to foreign exchange and raw material supply risks, including reliance on imported natural rubber from Sri Lanka and Malaysia and sole-source suppliers for certain older formulations.
Oct 20, 1995
1994
West Pharmaceutical Services Annual Report, Year Ended Dec 31, 1994
The West Company, Incorporated (now West Pharmaceutical Services, Inc.) reported net sales of $365.1 million for 1994, up from $348.7 million in 1993, with net income of $27.3 million, or $1.70 per share, compared with $23.5 million, or $1.48 per share, in 1993. Gross profit rose to $116.1 million, and the gross margin improved to 31.8% from 30.0%. The company operates in one industry segment, making elastomer, metal, glass and plastic stoppers, closures, containers and medical device components for the health care and consumer products markets. Health care represented over 85% of revenues. Becton Dickinson and Company accounted for approximately 11% of consolidated net sales. The balance sheet expanded during 1994 mainly through acquisitions. Total assets rose to $397.4 million from $309.2 million, and total debt increased to $57.8 million from $32.3 million. Cash of $27.2 million was on hand at year-end, and working capital was $50.4 million. Cash from operations totaled $49.8 million, against $27.1 million of capital expenditures and $7.2 million of dividends ($.45 per share). Shareholders' equity reached $227.3 million, and return on shareholders' equity was 13.2%. A subsequent event disclosed in the filing is a definitive merger agreement announced March 24, 1995, under which the company will acquire PACO Pharmaceutical Services, Inc. for $12.25 per share in cash, a purchase price of approximately $54 million funded from cash and existing bank facilities. The filing also notes an environmental cleanup matter in Wayne, New Jersey, for which the company has initiated legal action to compel a property owner to provide a use restriction.
Mar 30, 1995