EU HEALTHCARE: Sandoz Group AG: 2Q 25 (SDZSW; Baa2/BBB/NR)
Aug-07 08:27
Positive. Strong growth in Biosimilars with improved margins over Generics.
• Net sales $5.232m +4% CC for H1
• Accelerated growth in Q2 at 5% CC; 8% reported.
• Biosimilars grew 11% to $1,496m.
• Core EBITDA $1,046m +20% organic; +18% reported.
• Margin upticked to 20% from 17.5%.
• Full-year 2025 guidance confirmed: mid-single-digit net-sales growth at CC and a core EBITDA margin of around 21%
• More biosimilar launches to come in H2. Core EBITDA margin to grow, reflecting mix of sales.
• Issued €500m 10yr in March and CHF400m. Next maturity Nov ’26.
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UK FISCAL: OBR Fiscal Risks and Sustainability Report Due 9:30BST
Jul-08 08:23
- The OBR is due to release its "Fiscal Risks and Sustainability Report" at 9:30BST this morning.
- This looks very long-term and will provide updates on the long-term costs and effects of climate change, the public balance sheet and pension (including demographics, savings rates, structure of gilt market etc).
- The last update in September noted that public spending was predicted to rise from 45% of GDP to 60% of GDP over the next 50 years with revenues remaining at 40% of GDP. This would see debt/GDP at 274% in the baseline projection by the end of the forecast. It noted that "to return debt to its pre-pandemic levels would require an average fiscal tightening of 1.5 per cent of GDP per decade over the next 50 years."
- An update for the above will be watched by markets, as will the underlying assumptions - the most important of which is that of potential productivity which at present is 1.5%. The OBR notes that "every 0.1 per cent increase in productivity growth reducing the rise in the debt-to-GDP ratio by 25 percentage points. A full 1 percentage point increase, equivalent to a return to pre-financial crisis rates of productivity growth, could keep debt below 100 per cent of GDP throughout the next 50 years."
- On changes to productivity Citi note: "The OBR made downward revisions to near-term productivity but left medium-term productivity (at the 5yr horizon) at 1.25%. The OBR’s medium-term productivity assumptions have been sticky and gravitate towards the long-term baseline. Any change to the latter in today’s FRS could hint at a downward revision to productivity in the autumn, negatively impactive fiscal headroom. Every 0.1%point change is worth about £7-8bn of fiscal headroom. Even if the long-term baseline remains at 1.5%, that won’t rule out downward revisions to productivity in the autumn given the OBR has been consistently optimistic (noting the post-GFC average is around 0.5%)."
DUTCH AUCTION RESULTS: 3.25% Jan-44 Green DSL
Jul-08 08:20
| 3.25% Jan-44 Green DSL | Previous | |
| ISIN | NL0015001RG8 | |
| Amount | E2.055bln | E1.825bln |
| Avg yield | 3.176% | 2.976% |
| Avg Price | 101.01 | 104.00 |
| Pre-auction mid | 100.924 | 103.894 |
| Previous date | 09-Jul-24 |
EU-BOND SYNDICATION: New 7-year Dec-32 / 3.75% Oct-45 tap: Final terms
Jul-08 08:15
New 7-year Dec-32 EU-bond
- Size: E5bln (bottom of the E5-7bln range we expected)
- Books in excess of E62bln (inc E7.55bln JLM interest)
- Spread set: MS + 35bps (guidance was MS + 37bps area)
- Coupon: Short first coupon
- Maturity: 13 December 2032
- ISIN: EU000A4ED0K0
3.75% Oct-45 EU-bond tap:
- Size: E4bln up from original E3bln guidance (MNI expected E3-5bln)
- Books in excess of E72bln (inc E7.55bln JLM interest)
- Spread set: MS + 95bps (guidance was MS + 97bps area
- ISIN: EU000A4EA8Y7 (immediately fungible)
For both:
- Settlement: 15 July 2025 (T+5)
- JLMs: BNP Paribas, Citi, Deutsche Bank (DM/B&D), J.P. Morgan, Nomura
- Timing: Books to close at 9:45BST / 10:45CET
From market source
