Chief Financial Officer’s Report

Tania Micki

Tania Micki

Chief Financial Officer (since February 2020)


Reported net profit for the year 2020 rose to CHF 103.7 million.




In the year under review, Tecan recorded a surge in orders for product lines supporting the global fight against the coronavirus pandemic. Full-year order entry increased by 33.9% to CHF 855.2 million (2019: CHF 638.6 million), or by 38.5% in local currencies. After orders already grew by 24.3% in local currencies in the first half of the year, with an increase of 51.8% in local currencies order entry accelerated further in the second half. Order backlog even grew at a significantly higher rate than full-year order entry to reacha record high as of December 31, 2020.


Sales for fiscal year 2020 climbed by 14.8% to CHF 730.9 million(2019: CHF 636.8 million), corresponding to growth of 18.7% inlocal currencies. The growth trend accelerated in the second halfof the year, with sales increasing by 23.5% in Swiss francs and 27.8%in local currencies.


Demand for pipette tips increased drastically due to the testing needs associated with COVID-19. As a result, overall recurring sales of services, consumables and reagents also increased in the full year 2020 by 26.2% in local currencies and 21.3% in Swiss francs, thus amounting to 43.6% of total sales (2019: 41.3%).



In Europe, Tecan’s full-year sales increased by 9.6% in local currencies and by 7.6% in Swiss francs. The increase in sales was driven by the Life Sciences Business, with instrument installations supporting PCR-based testing as part of the European COVID-19 response. Sales of the Partnering Business declined in Europe as several customers saw lower demand based on the decrease in doctor visits and related lower volumes in routine diagnostic testing as well as restricted access to labs. Sales growth in local currencies accelerated in the second half of the year to 12.9%.


In North America, sales grew by 24.9% in local currencies and 19.5% in Swiss francs in 2020, with both business segments delivering double-digit growth rates in local currencies. Sales in local currencies increased even by 43.3% in the second half of the year, reflecting a surge in demand for COVID-19 related products.


In Asia, Tecan recorded a significant increase in sales of 22.7% in local currencies and 17.5% in Swiss francs. This increase was driven by double-digit growth rates in both business segments. Growth in China outpaced that of the Asia region as a whole, bringing the total business in China to over CHF 80 million in the year. In the second half, sales in Asia increased by 20.8% in local currencies and 16.8% in Swiss francs.


The reader is referred to the “Life Sciences Business” and “Partnering Business” sections of this Annual Report for a detailed description of the business performance of the individual segments.


Gross profit increased to 354.9 million Swiss Francs (2019: CHF 297.3 million), which was 57.6 million or 19.4% above the prior-year figure. The reported gross profit margin increased to 48.6% – 190 basis points higher compared to the prior year (2019: 46.7%).


Several factors impacted the gross profit margin level. Main effects contributing:

  • (+) Product mix, despite a higher contribution from consumables
  • (+) Price
  • (-) Underabsorption of service organization due to closed facilities and restricted access to labs
  • (-) Higher freight and logistics cost mainly due to less capacity available
  • (-) Exchange rate impact


In 2020, operating expenses grew less than sales and totaled CHF 234.0 million or 32.0% of sales (2019: CHF 209.4 million or 32.9% of sales).


Sales and Marketing increased slightly less than sales to CHF 105.9 million despite continued investments in the market units (2019: CHF 92.9 million).


At an absolute level, net research and development expenses increased to CHF 62.0 million (2019: CHF 59.9 million). As a percentage of sales, they reached 8.5% of sales (2019: 9.4%).


Overall R&D activities and gross expenses (“gross R&D”) were also higher compared to the prior-year period, including capitalization of development costs and customer funding of OEM projects. Capitalization of development costs increased to CHF 15.3 million driven by milestone completion as projects neared market launch (2019: CHF 12.4 million). Gross R&D was at CHF 78.5 million or 10.7% of sales (2019: CHF 77.8 million or 12.2% of sales).


General and administration expenses increased to CHF 66.0 million (2019: CHF 56.6 million), mainly due to more cost on the corporate level mostly related to performance-based personnel cost and investments in process improvement and digitalization projects.


Reported operating profit before depreciation and amortization (earnings before interest, taxes, depreciation and amortization; EBITDA) rose by 29.6% to CHF 159.1 million in the fiscal year 2019 (2019: CHF 122.8 million). The increase in reported EBITDA was mainly driven by benefits of scale due to the significantly higher volumes. In addition to common economies of scale, reported EBITDA benefited from an even more positive impact as the overall cost base was not yet fully adjusted to support the business on a sustainable basis. The results development was also helped by a one-time positive effect from an adjustment of the Swiss pension plan as well as increased capitalization of development costs as projects neared market launch. On the other hand, exchange rate movements in major currencies versus the Swiss franc had a negative impact on the reported EBITDA, comparable to the one-time positive effects.


The reported EBITDA margin grew correspondingly by 250 basis points to 21.8% of sales (2019: 19.3%). Assuming exchange rates in line with 2019, the reported EBITDA margin would have stood at 22.5% of sales.


The profit before interest and taxes, EBIT, with an increase of 36.9% grew more than sales to CHF 121.4 million (2019: CHF 88.7 million). The EBIT margin increased to 16.6% of sales (2019: 13.9%).


Reported net profit for the year 2020 rose by 41.7% to CHF 103.7 million (2019: CHF 73.2 million). Thanks to an improved financial result, net profit increased by more than operating profit (earnings before interest and taxes; EBIT). The net profit margin amounted to 14.2% of sales (2019: 11.5%), while earnings per share rose strongly to CHF 8.69 (2019: CHF 6.18).


Shareholders’ equity at December 31, 2020 increased by 11.3% to CHF 733.7 million (2019: CHF 659.1 million). Correspondingly, Tecan's equity ratio reached 66.2% as of December 31, 2020 (December 31, 2019: 70.1%).


Cash flow from operating activities more than doubled to CHF 208.3 million (2019: CHF 98.8 million), due to a focus on cash collection and management. Thus, cash flow from operating activities corresponded to 28.5% of sales (2019: 15.5%).


Net liquidity (cash and cash equivalents plus short-term time deposits minus bank liabilities and loans) reached CHF 467.7 million (June 30, 2020: CHF 354.0 million; December 31, 2019: CHF 312.4 million).

Tania Micki

Chief Financial Officer (since March 2020)