TMO - Avantor 1Q20 Earnings: Thesis Intact And Risks Mitigated
The following variance table shows Avantor's performance in the quarter versus my estimates.
Exhibit 1. 1Q20 Earnings Versus Viceni Estimates
Here are the key takeaways from the quarter:
- 4.1% normalized revenue growth beat my 0.6% estimate and even exceeded prior guidance. Management pointed to a tailwind of 50-100 bps from COVID due to demand for protective equipment, reagents, and possibly some stocking. As I anticipated, management confirmed that most of their facilities have essential status. Moreover, supply chains remain mostly intact.
- The negative impact from COVID was centered on the closure of academic labs (as