German biotech company, BioNTech (BNTX), experienced a decline in its stock value as of the latest reporting on Monday, even as the company revealed a narrowing of losses in the second quarter, posting a loss of €0.79 per share compared to last year’s diluted earnings of €6.45 per share during the same period. The noteworthy aspect of the quarter’s performance, however, was the staggering 94.8% year-over-year plummet in sales, which stood at €167.7 million.
Impact of Pfizer Collaboration Weighs Heavily on BioNTech’s Q2 Results
BioNTech attributed its disappointing second-quarter results to write-offs from its collaboration partner, Pfizer (PFE). This development significantly impacted the company’s gross profit share and, consequently, had a detrimental effect on its revenue figures. Jens Holstein, the CFO of BioNTech, acknowledged the volatile nature of the COVID-19 vaccine market and emphasized the company’s continued dedication, in partnership with Pfizer, to support successful vaccinations, especially during the upcoming autumn respiratory infection season.
Holstein expressed caution, given the uncertainty surrounding revenue projections, and stated that the company is carefully monitoring its expenditures by reassessing its cost structure. Despite these challenges, BioNTech reaffirmed its projection for COVID-19 vaccine revenues for the fiscal year 2023, estimating them to be approximately €5 billion.
Revised Financial Outlook and Analyst Sentiment
BioNTech outlined its updated financial outlook for the rest of the fiscal year. The company now expects research and development costs and SG&A expenses for FY23 to fall within the range of €2,000 million to €2,200 million and €600 million to €700 million, respectively. This revision demonstrates a more prudent approach to cost management compared to the previous guidance of €2,400 million to €2,600 million for R&D costs and €650 million to €700 million for SG&A expenses. Market analysts, in light of the recent developments, “BUY” rating for BNTX stock.
Q2 Earnings Fall Short of Expectations
The early Monday announcement revealed that BioNTech reported a loss of $1.06 per share on second-quarter sales amounting to $185 million. This led to a decline in the value of BNTX stock. Analysts surveyed by FactSet had anticipated an adjusted loss of 30 cents per share on sales of $692.4 million, showcasing the substantial deviation from projections. Comparatively, in the same period of the previous year, BioNTech had achieved earnings of $7.01 per share from sales of $3.27 billion.
Looking Ahead
BioNTech remains committed to its full-year sales projection of approximately $5.5 billion, factoring in anticipated stronger sales during the latter part of 2023. The company’s sales for the first half of the year amounted to about $1.54 billion. Analysts had previously anticipated adjusted earnings of $5.13 per share and sales of $5.92 billion for the entire year. As of premarket trading on the current stock market, BNTX stock experienced a 5% decrease, trading around $101.20.
