Catalent Reports Loss in Q2 Amid Sales Decline

Catalent, a contract drug manufacturer, experienced a significant loss in its fiscal second quarter as sales decreased and margins weakened. The company reported a loss of $204 million, or $1.12 per share, compared to a profit of $81 million, or 44 cents per share, in the same quarter last year.

After adjusting for one-time items, the loss amounted to 24 cents per share. Analysts surveyed by FactSet had anticipated an adjusted loss of 3 cents per share. Additionally, revenue dropped 10% to $1.03 billion, falling short of analyst forecasts of $1.36 billion.

The decline in revenue can be attributed to a decrease in demand for Covid-19 related programs. Organically, the company's top line was down 11%. Despite the decrease in sales, the cost of sales rose to $871 million from $762 million in the previous year's quarter. Overhead costs also increased, as did the company's net interest expense.

It is noteworthy that these reports come shortly after the announcement that the owner of Novo Nordisk plans to acquire Catalent for a total of $16.5 billion, including debt.