Alternative Performance Measures
Lonza uses Alternative Performance Measure (APMs) to assess the financial and operational performance at a divisional and group level. These supplementary financial measures should not be viewed in isolation or as alternatives to Lonza’s consolidated financial position and financial results, which are reported in accordance with IFRS. Instead, our APMs are intended to provide a complementary perspective on Lonza’s performance by isolating distorting effects like exchange rate fluctuations or one-time items.
For more detailed information on the applied performance, liquidity and capital measures, refer to Lonza’s 2023 Alternative Performance Measures Report.
Lonza has revised the definition of three Alternative Performance Measures including CORE EPS, Free Cash Flow and Divisional CORE EBITDA. The new definitions will be reflected in the H1 2024 reporting process. The changes are designed to enhance transparency and efficiency and will not change IFRS reporting. Additional information, including Restated Full-Year 2023, Half-Year 2023 and Full-Year 2022 results, can be found here.
Credit Rating
Lonza has been rated by Standard & Poor’s (S&P) since 2019 with an investment grade rating of BBB+ and stable outlook. The rating has been confirmed by S&P since then and Lonza is committed to maintaining a strong investment-grade rating going forward.
Dividend
A dividend of CHF 4.00 per share was proposed by the Lonza’s Board of Directors and approved by the shareholders at the Annual General Meeting (AGM) on 8 May 2024. The dividend represents a pay-out of 44% of 2023 reported profit for the period of Lonza Group. 50% of the dividend of CHF 4.00 per share has been paid out of the capital contribution reserve and will therefore be free from Swiss withholding tax.
Dividend payment history
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Share Buyback
On 25 January 2023, Lonza announced a program to buy back its own registered shares of up to CHF 2 billion over a maximum period of two years for the purpose of subsequent capital reductions. The buyback program started on 3 April 2023. The total number of shares repurchased at 31 December 2023 was 2,242,568 for a total value of CHF 995.4 million.
For more detailed information on the share buyback mechanism, trading line and transaction reporting, refer to Share Buyback.
Currency exposure
The 2023 currency exposure reflects as follows:
| Sales | Cost1 | |
|---|---|---|
| USD | 40% | 37% |
| CHF | 37% | 29% |
| EUR | 13% | 16% |
| GBP | 5% | 5% |
| CNY | 2% | 5% |
| Other | 3% | 7% |
Foreign exchange management hedging policy and process:
- Focus on natural hedge incl. financing mix
- Centralized Forex Risk Management
- Balance sheet, short term profitability and CAPEX hedging programs
Pension benefits
The group operates defined-benefit pension plans in various countries, with the major plans being in Switzerland and Great Britain (these plans are described in Note 23, page 104 of the Financial Report in Lonza’s Annual Report 2023). For pension accounting purposes, these plans are considered as defined-benefit plans.
The significant actuarial assumptions at the reporting date (expressed as weighted averages) were as follows:
| in % | ||||
|---|---|---|---|---|
| 2023 | 2022 | |||
| CHF | UK | CHF | UK | |
| Discount rate | 1.50 | 4.55 | 2.28 | 5.05 |
| Future salary increases | 1.25 | n.a. | 1.25 | n.a |
| Future pension increases | n.a. | 3.05 | n.a. | 3.35 |
How much does Lonza spend on research and development (R&D)?
Research & Development (R&D) costs include all primary costs directly related to this function, as well as internal services and imputed depreciation. These costs are incurred for:
- Development of new products and services
- Improvement of existing products and services
- Development of new production processes
- Improvement of existing production processes
- Cost for patents
- Purchase price for product and process know-how to the extent not capitalized
The R&D costs amounted to CHF 253 million (2022: CHF 194 million) and represent the full range of R&D activity. However, the consolidated income statement discloses lower levels of research & development costs, as the remainder of such costs are absorbed in cost of goods sold for R&D products and services sold.
Where are Lonza shares traded?
Shares of Lonza Group Ltd are listed on the SIX Swiss Exchange and Swiss Market Index (SMI). We also maintain a secondary listing on the SGX Singapore Exchange.
What is the stock symbol?
Stock Exchange Listing / Trading:
SIX Swiss Exchange
SGX Singapore Exchange
Common Stock Symbols
Bloomberg LONN SW
Reuters LONN.S
Six Swiss Exchange LONN
SGX Singapore Exchange O6Z
Security Number:
Valor 001384101
ISIN CH0013841017
Lonza's share register contact
Share Register - Registration
c/o Computershare Schweiz AG
P.O.
Box
CH-4601 Olten, Switzerland
Tel +41 62
205 7700
Fax +41 62
205 7790
share.register@computershare.ch
How many shares does Lonza have issued?
The share capital on 31 December 2023 comprised 74,468,752 registered shares (2022: 74,468,752) with a par value of CHF 1 each, amounting to CHF 74,468,752 (2022: CHF 74,468,752).
| Registered Shares | 2023 | 2022 | ||
|---|---|---|---|---|
| Number of shares issued | 74,468,752 | 74,468,752 | ||
| Number of shares ranking for dividend | 74,116,589 | 74,281,626 | ||
| Par value per share | CHF | 1 | 1 | |
| Profit for the period (equity holders of the parent) | million CHF | 654 | 1,215 | |
| Ratios per Security | 2023 | 2022 | ||
| Weighted average number of shares | 73,630,469 | 74,229,594 | ||
| Diluted weighted average number of shares | 73,683,825 | 74,357,336 | ||
| Basic earnings per share | CHF | 8.88 | 16.37 | |
| Diluted earnings per share | CHF | 8.88 | 16.34 | |
What is Lonza doing to protect the environment?
We continuously evaluate and strive to reduce our impact on natural systems and the environment, conserve energy and resources, reduce the carbon footprint, assure safety, health and wellbeing of our employees and help to improve the quality of life in the communities in which we operate. The aim of our “Vision Zero” initiative is to reduce risks, workplace injuries and environmental incidents.
We have a systematic approach, processes and targets on various environmental topics, for example:
- Greenhouse Gas Emissions, to reduce the footprint from our operations, the value chain and new build assets
- Energy, to improve energy efficiency and source from renewable sources
- Water, to improve water conservation and efficiency
- Waste, to reduce the material disposed and increase circularity
Programs are developed at site level, in alignment with company policies, priorities and goals. We build multi-year roadmaps to enable continuous improvement, follow-up to reduce the impact of the operations over a number of years. In addition, with the commitment to the Sustainable Development Goals on Water and Infrastructure, and Science Based Targets Initiative on Climate Action, we have introduced high ambitions of environmental performance.
For more information, please visit our Sustainability Report 2023.
What is Lonza's position on corporate governance?
Lonza has implemented modern corporate governance structures to ensure accountability, responsibility and transparency throughout the Group and for its shareholders. Corporate governance reporting is in compliance with the guidelines of SIX Swiss Exchange. Learn more about Lonza's position on Corporate Governance.