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SYNLAB delivers strong 9M 2021 results, on track to significantly exceed 2021 financial targets set at IPO

DGAP-News: SYNLAB AG / Key word(s): Quarter Results
10.11.2021 / 07:29
The issuer is solely responsible for the content of this announcement.


- Strong revenue growth delivered since the beginning of the year

- +20% revenue growth in Q3 2021

- +64% in 9M 2021

- +3.5% underlying growth in 9M 2021 driven by For You initiatives

- Profitability uplift driven by volume leverage

- Q3 2021 margin remained elevated post H1 2021 peak

- 32.8% adjusted EBITDA margin in 9M 2021

- Extra cash generation with capacity to accelerate growth plans

- EUR 630 million unlevered free cash flow in 9M 2021

- Leverage ratio at 1.3x by end of September

- 18 acquisitions completed; full-year M&A target spend of EUR 200 million already exceeded

- 2021 financial guidance (adjusted slightly upward today) materially higher than IPO targets

- 2022 outlook showing further material upside vs. pre COVID-19 period (+50% revenue vs. 2019)

SYNLAB, (ISIN: DE000A2TSL71, SYMBOL: SYAB) the largest European clinical laboratory and medical diagnostic services company, announces its unaudited consolidated Q3/9M results.

"At the end of the third quarter of 2021, our results are already significantly above the results for the full year 2020. We are therefore in a position to significantly exceed the 2021 targets set at IPO. This major outperformance is driven by consistent execution of our growth agenda. We are progressing on our "For You" growth initiatives, notably around retail and prescribers. We have made further inroads into the hospital market thanks to our leadership position in Specialty testing. And we have accelerated on our M&A roadmap. Meanwhile, the COVID-19 activity is reducing from peak levels but remains at elevated levels, thanks to our unmatched geographic breadth. In addition to giving us significantly increased financial capacity to accelerate our development, this very strong start as a public company evidences our strong execution and transformation capabilities for the future." says Mathieu Floreani, CEO of SYNLAB Group.

SYNLAB Key figures (€m) Q3 2021 YoY Growth 9M 2021 YoY Growth
Revenue 849.3 +20% 2,772.3 +64%
Operating profit 173.8 x21.5 689.1 x8.6
Net profit (Group share) 128.0 +200m 471.3 +565m
Adjusted EBITDA 245.3 x1.3 908.0 x2.4
Adjusted operating profit (AOP) 192.1 x1.3 761.4 x3.0
Adjusted net profit (Group share) 143.3 +83m 514.9 +447m
Unlevered free cash flow 202 +151m 630.2 +570m

Financial highlights

Strong revenue growth delivered since the beginning of the year

SYNLAB delivered another quarter of strong growth in Q3 2021, with revenue up 20% to EUR 849 million.

The growth contributions of COVID-19 testing and underlying activity were more balanced during the quarter:

- SYNLAB continued to enjoy growth in its COVID-19 testing activity, despite an increasingly high comparison base, with a net revenue contribution of EUR 307 million[1] (Q3 2020: EUR 236 million). The attrition[2] impact measured in the quarter was EUR 5 million in specific countries of the North & East and South segments. SYNLAB performed 6.3 million PCR tests in the quarter, at an average price per test of EUR 44;

- underlying growth (excludes both COVID-19 testing revenue contribution and the positive impact of lower attrition) accelerated again in Q3 2021 to reach 12.2%. This growth momentum was mainly attributable to the strong execution of the South-East London (SEL) hospital outsourcing contract.

9M 2021 revenue was up 64% to EUR 2,772 million (9M 2020: EUR 1,691 million), demonstrating SYNLAB's ability to combine both leadership in the COVID-19 response and good execution of its underlying growth strategy:

- the net revenue contribution from COVID-19 was EUR 1,137 million[3] during the 9 months to September 2021, with SYNLAB performing 20.8 million PCR and 3.5 million non-PCR tests during the period;

- underlying growth was 9.1%: SYNLAB was able to deliver underlying organic growth over 3% each quarter since the beginning of the year, notably thanks to the "For You" growth initiatives. In the last two quarters, growth was further supported by the contribution of SEL.

Volume growth strongly improved profitability

In Q3 2021, SYNLAB adjusted EBITDA reached EUR 245 million with margin expanding by 1.8 percentage points compared to Q3 2020, at 28.9%. Incremental volumes from COVID-19 testing on a relatively fixed cost base was the main driver for the margin uplift. However, the Q3 2021 margin uplift is lower than in H1 2021, reflecting the gradual COVID-19 volume and price reductions.

For 9M 2021 adjusted EBITDA was EUR 908 million and the margin 32.8%, an increase of 10.1 percentage points compared to 9M 2020 reflecting the record growth experienced during the first 9 months of the year.

Margins have further benefited from productivity and procurement savings related to the SALIX program (EUR 15 million in 9M 2021), as well as procurement efficiencies for PCR test reagents and strict management of personnel and other OPEX costs.

Net profit at all-time high

Adjusted operating profit reached EUR 761 million at the end of September 2021 (EUR 257 million in 9M 2020). Post adjustments, which were mainly comprised of customer relationship amortization, IPO-related costs and acquisitions-related costs, operating profit was EUR 689 million (EUR 80 million in 9M 2020).

The key bridge items from operating profit to net profit were:

- a EUR 87 million net financial expense, improving by EUR 56 million compared to 9M 2020. This major decrease came from a combination of lower borrowings and lower borrowing costs. The SYNLAB average cost of borrowing was 2.5% in Q3 2021, compared with 4.7% in Q3 2020;

- a EUR 145 million tax expense (EUR 36 million in 9M 2020). The effective tax rate was ~24% for the period, lower than the 28% normalized rate due to the use of tax attributes carried forward;

- a EUR 17.9 million positive impact from a residual sale of the A&S business in Q1 2021, classified as discontinued operations.

Net profit (Group share) reached EUR 471 million (EUR (94) million in 9M 2020), and basic earnings per share were up at EUR 2.22[4].

Record cash flow generation

Operating cash flow from continuing operations expanded materially, to EUR 786 million at the end of 9M 2021, driven by profit growth. The negative impact of COVID-19 testing activity on working capital has materially reduced over the past quarters, with inventory going down and DSOs normalizing to 57 days at the end of 9M 2021, compared with 80 days at the end of 9M 2020.

Total CAPEX (including leases and related interest payments) was EUR 156 million in 9M 2021 (EUR 132 million in 9M 2020) representing 5.6% of 9M 2021 revenue (7.8% in 9M 2020). It included EUR 9 million of COVID-19 related CAPEX.

Despite the CAPEX increase in absolute terms, strong operating cash flow led to record unlevered free cash flow of EUR 630 million in 9M 2021. The cash conversion ratio (unlevered free cash flow / adjusted EBITDA) was 69%.

Strong balance sheet

At the end of September 2021, the adjusted net debt stood at EUR 1,513 million compared with EUR 2,254 million at the end of December 2020. The leverage ratio[5] was at 1.3x compared with 3.3x at the end of 2020, the lowest level since the creation of the SYNLAB Group, attributable to the EUR 394 million of net proceeds from its successful IPO and the strong cash generation since the beginning of the year.

In Q3 2021, SYNLAB decided to prepay EUR 150 million of loans due in 2026. A further repayment of EUR 75 million was successfully completed on 28 October 2021.

Exceeding EUR 200 million of M&A spend in 2021

Since the beginning of the year, SYNLAB has completed 18 acquisitions for a total enterprise value of about EUR 250 million. These acquisitions represent additional annualized revenue of around EUR 113 million or 5.5% growth of the base business[6]. In addition to the 10 acquisitions completed in H1 2021, SYNLAB closed 3 acquisitions in Q3 2021 and 5 more since the beginning of Q4, four of which are located in the South region and one in France.

Most of them were bolt-on acquisitions, with SYNLAB also completing two mid-sized deals in Italy and Mexico:

- Gruppo Tronchet (EUR 22 million revenue in 2020), a strong regional player to strengthen SYNLAB's number one position in Italy with 17 patient-centric healthcare centers in and around Bologna.

- Laboratorio Médico Polanco -LMP- and Laboratorio Clinicos de Puebla -LCR- (EUR 55 million revenue in 2020), a top 4 player in Mexico (100 diagnostic service points and 1,700 skilled employees) as a platform to further consolidate the Mexico and Latam markets.

The pipeline for future acquisitions is strong and diversified, and SYNLAB keeps a very disciplined acquisition approach.

Segment review

France (23% of 9M Group revenue)

In Q3 2021 SYNLAB recorded total revenue growth of 5.8% including strong underlying organic growth of 3.4%. Solid volume growth and a positive working-day effect more than offset the price decrease as per the 3-year agreement with the French health authorities, implemented in Q2 2021. COVID-19 testing contribution declined sequentially, due to volume reduction and the gradual price decrease but was broadly stable compared to Q3 2020. In addition to the normal testing activity, SYNLAB remained highly mobilized on school testing.

After a strong start to the year, M&A activity reduced over the period due to SYNLAB's selective approach with a primary focus on small bolt-on acquisitions.

9M 2021 total growth was 52%, lifted by high COVID-19 testing volumes since the beginning of the year. Underlying organic growth was 1.4%, with solid volume growth offsetting the regulatory price decrease. 9M 2021 AOP was broadly in line with the first half of the year at 26.5% (+5.1 percentage points compared with 9M 2020), reflecting the sustained margin-accretive impact of high COVID-19 testing volumes.

Germany (18%)

In Q3 2021 SYNLAB recorded underlying organic growth of 2.6%, mostly volume driven. Total revenue growth at (3.3)% was however impacted by a more pronounced drop in COVID-19 testing volume and price than in other segments, despite SYNLAB's leadership on variant detection and school testing.

9M 2021 total growth was 33%, including high COVID-19 testing volumes, in particular in the first two quarters of the year, and underlying organic growth of 2.8%. 9M 2021 AOP margin remained elevated at 21.5% (+10.8 percentage points compared with 9M 2020), reflecting the margin-accretive impact of COVID-19 testing volumes. The reduction in AOP margin in Q3 2021, to 9.9%, reflects the drop of COVID-19 volume and prices as well as one-off expenses incurred in the quarter.

South (29%)

In Q3 2021 SYNLAB recorded total revenue growth of 3.4%, against a strong comparable base in Q3 2020, both for the underlying and COVID-19 testing activities. Underlying growth was 2.6%, with mixed performances across countries. Switzerland (14% of South revenue) was still in negative territory, now mainly attributable to price reductions implemented in December 2020 (genetics), as the 2020 customer losses impact is phasing out. Iberia (31% of South revenue) recorded low single digit underlying organic growth. Latam (16%) growth slowed down in Q3, mainly attributable to Colombia, where growth was affected by high comparables. Italy (39% of South revenue) achieved another quarter of robust growth.

SYNLAB remained very active on the M&A front in Q3 2021, with 2 bolt-on acquisitions closed in Spain and Mexico, 1 mid-sized deal closed in Italy and an agreement reached for the purchase of another mid-sized lab business in Mexico (see M&A section for further details).

9M 2021 total growth was 46%, lifted by high COVID-19 testing volumes since the beginning of the year, peaking in Q2 2021. Underlying organic growth was 4.4%: the softer Q3 2021 growth came after two quarters above 5%. 9M 2021 AOP margin remained elevated at 24.2% (+10.0 percentage points compared with 9M 2020), reflecting the margin-accretive impact of high COVID-19 testing and robust underlying activity volumes since the beginning of the year.

North & East (30%)

In Q3 2021 SYNLAB recorded total growth of 86%, benefiting from sustained high COVID-19 testing but also enjoying very strong underlying organic growth of 44.1%.
The UK (24% of revenue) recorded a triple digit percentage growth thanks to the contribution of the SEL contract. Excluding SEL, underlying organic growth was a robust 4.9% in Q3 2021.
Growth mainly came from the more mature North markets (50% of North & East revenue), highlighting the benefits of "For You" growth initiatives such as retail initiatives in the Nordics or connecting to doctors in Austria. Central Europe and Emerging markets (26% of North & East revenue) recorded more modest growth, in the lower single digit area.

9M 2021 total growth was a record 138% reflecting both the high COVID-19 contribution and a 30% underlying organic growth at the end of September. 9M 2021 AOP margin was a very strong 34.8% (+20.4 percentage points compared with 9M 2020), reflecting the margin-accretive impact of high COVID-19 testing, including government testing contracts in North Europe, and robust underlying activity volumes since the beginning of the year.


Over-delivering on 2021 IPO targets

At IPO, SYNLAB presented a growth strategy of customer centric medical excellence. The focus was notably on: 1) consistently outperforming market growth through the implementation of growth initiatives ("For You" initiatives), 2) successfully delivering in 2021 on the biggest hospital outsourcing contract in the UK (the "SEL" contract) and 3) deploying around EUR 200 million to continue to consolidate the highly fragmented medical diagnostic services market.

At the same time, SYNLAB aimed at maintaining its leadership in the SARS-CoV-2 pandemic response.

Six months after its IPO, SYNLAB is showing excellent progress on all areas of focus:

  At IPO Current guidance Status Key enablers
Organic growth (ex COVID-19) ~10% ~10% Delivering -For You
M&A (EV, in €m) ~200 >200 Acceleration -Strong & diversified pipeline
-Mid-sized M&A
-Price discipline
COVID-19 revenue (€m) ~800 (2021)
~500 (2022)
>1,300 (2021) 2 years in 1 -Best medical, commercial, operational execution

Consequently, the current 2021 financial guidance shows very material upside compared to the IPO guidance. This guidance is adjusted slightly upward today to reflect rising COVID-19 incidence rates in a number of SYNLAB countries since October:

  At IPO Current guidance Outperformance
Revenue (€bn) >3.0 >3.5 >+0.5
Total growth ~17% >34% >x2
AEBITDA (€m) ~800[7] >1,000 >200
AEBITDA margin ~26% >30% >4ppts
Unlevered FCF (€m) 300-350 >700 >350

Thanks to the strong cash flow generation, SYNLAB can further accelerate its development plan, notably through M&A.

FY 2022 outlook

In 2022, SYNLAB will continue with the implementation of its growth strategy: outperforming market growth through initiatives and continuing to grow through M&A. The Group also expects COVID-19 testing revenue to decline but to remain significant due to SYNLAB's large-scale, geographically diversified and medically relevant service offering.

Therefore, SYNLAB expects 2022 revenue and EBITDA margin to remain significantly higher than the pre-COVID period (2019):

    2022 outlook Vs. 2019
Revenue (€bn)   ~2.9 +1.0
AEBITDA margin   23-25% >2.2ppts
M&A spend (€m)   >200 >100

Mid-term financial outlook (set at IPO)

    Mid-term outlook
Organic growth[8]   3%+
Total growth8   ~10%
AEBITDA margin   23%
AEBITDA to unlevered FCF conversion   45-50%
M&A spend (€m)   200

Conference call

SYNLAB will hold its 9M'21 results conference call today at 3:00 PM CET, hosted by Mathieu Floreani, CEO of SYNLAB and Sami Badarani, CFO of SYNLAB.

Direct link to webcast here.


For more information:

Media contact:
Diana Tabor, FTI Consulting
+49 (0) 151 466 938 56
Investor contact:
Mark Reinhard, SYNLAB
+49 (0) 170 118 3753


- SYNLAB Group is a leading international medical diagnostics provider and offers a full range of innovative and reliable medical diagnostics for patients, practising doctors, clinics and the pharmaceutical industry.

- Providing the leading level of service within the industry, SYNLAB is the partner of choice for diagnostics in human and veterinary medicine. The Group continuously innovates medical diagnostic services for the benefit of patients and customers.

- SYNLAB operates in 36 countries across four continents and holds leading positions in most markets. More than 20,000 employees, including over 1,200 medical experts, as well as a large number of other specialists such as biologists, chemists and laboratory technicians, contribute every day to the Group's worldwide success. SYNLAB carries out ~500 million laboratory tests per year and achieved revenues of EUR 2.6 billion in 2020.

- More information can be found on

Financial calendar

Q4/FY Results 16 March 2022 (pre-market)
Q1 Results 12 May 2022 (pre-market)
Investor Day 21 June 2022

This document does not constitute or form a part of, and should not be construed as, an offer for sale or subscription of or solicitation of any offer to purchase or subscribe for any securities in any jurisdiction.
Statements made in this document may include forward-looking statements. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words "believes," "expects," "expected," "may," "will," "would," "should," "seeks," "pro forma," "anticipates," "intends," "plans," "estimates," "estimated," or the negative of any thereof or other variations thereof or comparable terminology, or by discussions of strategy or intentions. These statements are not guarantees of future actions or performance and involve risks, uncertainties and assumptions as to future events that may not prove to be accurate. Actual actions or results may differ materially from what is expressed or forecasted in these forward-looking statements. As a result, these statements speak only as of the date they were made and SYNLAB undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. It should be noted that past performance is not a guide to future performance. Interim results are not necessarily indicative of full-year results.
Certain data included in this document are "non-IFRS" measures. These non-IFRS measures may not be comparable to similarly titled financial measures presented by other entities, nor should they be construed as an alternative to other financial measures determined in accordance with International Financial Reporting Standards or any other generally accepted accounting principles. Although SYNLAB believes these non-IFRS financial measures provide useful information to users in measuring the financial performance and condition of its business, users are cautioned not to place undue reliance on any non-IFRS financial measures and ratios included in this document. Due to rounding, numbers presented throughout this document may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.

SYNLAB full set of non-audited financials is available in the 9M 2021 report published today and accessible here.


This announcement includes certain financial measures that are not presented in accordance with IFRS or any other internationally accepted accounting principles.

Organic growth is a non-IFRS measure calculating the growth in revenue for a given period compared to the comparable period of the prior year for the same scope of businesses, excluding discontinued operations, and in constant currency, i.e. using the exchange rates of the prior year reported period.

When calculating organic growth, SYNLAB uses the scope of businesses that have been consolidated in the Group's financial statement of the previous financial year. Revenue contribution from businesses acquired in the course of the prior year but not consolidated for the full year are adjusted as if they had been consolidated as from January of the prior year. All revenues from businesses acquired since 1 January of the current year are excluded from the calculation.

Adjusted EBITDA (AEBITDA) is operating profit adjusted for (by adding-back) depreciation and amortization, impairment of goodwill, expenses for restructuring and other significant items, acquisition related expenses, as well as other items of non-recurring nature included in operating costs (i.e. solely share-based payments in 2020).

LTM pro-forma adjusted EBITDA is adjusted EBITDA pro-forma for all acquisitions carried out over the last twelve months.

Adjusted operating profit (AOP) is operating profit adjusted for customer list amortization, impairment of goodwill, expenses for restructuring and other significant items, acquisition related expenses, other items of non-recurring nature included in operating costs (i.e. solely share-based payments in 2020).

Adjusted net profit is defined as profit (Group share) adjusted for adjustment items (see adjusted operating profit definition) and for the tax effect on adjustment items.

Adjusted net debt is defined as the sum of financial debt including loans and borrowings (adding back capitalized transactions costs) and lease liabilities, net of cash & cash equivalents.

Unlevered free cash flow pre-M&A (uFCF) is defined as the sum of cash flow from operating activities of continuing operations, net CAPEX (defined as the cash outflow from the purchase of intangibles and property, plant and equipment, net of proceeds from the sale of intangibles and property, plant and equipment) and leases (defined as the sum of lease repayments and lease interest).

Return on capital employed is defined as the last twelve months AOP after tax (using a normalized tax rate of 28%) on capital employed (defined as the sum of goodwill, net fixed assets and net working capital), adjusted for rights of use assets and deferred tax.


In EUR million Revenue AOP
  Q3 2021 Q3 2020 Organic Growth Underlying Growth Q3 2021 Q3 2020 Margin
Q3 2021
Margin, Q3 2020
France 187.0 176.8 3.3% 3.4% 50.1 47.7 26.8% 27.0%
Germany 144.9 149.9 (3.3)% 2.6% 14.3 20.4 9.9% 13.6%
South 239.8 232.0 1.2% 2.6% 50.5 45.6 21.1% 19.7%
North & East 277.6 149.5 83.6% 44.1% 77.2 33.2 27.8% 22.2%
SYNLAB Group 849.3 708.1 18.1% 12.2% 192.1 146.8 22.6% 20.7%
In EUR million Revenue AOP
  9M 2021 9M 2020 Organic Growth Underlying Growth 9M 2021 9M 2020 Margin 9M 2021 Margin
9M 2020
France 628.6 412.7 49.8% 1.4% 166.8 88.4 26.5% 21.4%
Germany 512.1 384.2 33.0% 2.8% 110.2 41.2 21.5% 10.7%
South 785.3 538.2 44.9% 4.4% 189.7 76.2 24.2% 14.2%
North & East 846.4 355.8 137.2% 30.0% 294.7 51.4 34.8% 14.4%
SYNLAB Group 2,772.3 1,690.9 62.8% 9.1% 761.4 257.2 27.5% 15.2%



Simplified P&L      
In EUR million 9M 2021 9M 2020 Growth
Revenue 2,772.3 1,690.9 64%
Gross profit 2,082.9 1,253.9 66%
AEBITDA 908.0 384.5 x2.4
As % of revenue 32.8% 22.7% +10.1pts
Adjusted operating profit (AOP) 761.4 257.2 x3.0
As % of revenue 27.5% 15.2% +12.3pts
Operating profit 689.1 79.7 x8.6
Financial result (86.6) (142.4) (39%)
Income tax expenses (145.1) (36.1) na
Adjusted net profit 514.9 67.6 +447
Net profit (Group share) 471.3 (93.7) +565
Basic EPS (€) 2.22 (0.47) n.a
Simplified cash flow      
In EUR million 9M 2021 9M 2020 Growth
Operating cash flow 786 192 +595
Unlevered free cash flow 630 60 +570
Net debt and leverage      
In EUR million Sep. 2021 Dec. 2020 Growth
Net debt 1,503 2,235 (732)
Adjusted net debt 1,513 2,254 (740)
Leverage ratio x1.3 x3.3 (x2.0)


Simplified P&L      
In EUR million Q3 2021 Q3 2020 Growth
Revenue 849.3 708.1 20%
Gross profit 636.1 517.9 23%
AEBITDA 245.3 191.6 x1.3
As % of revenue 28.9% 27.1% +1.8pts
Adjusted operating profit (AOP) 192.1 146.8 x1.3
As % of revenue 22.6% 20.7% +1.9pts
Operating profit 173.8 8.1 x21.5
Financial result (11) (42) +31
Income tax expenses (33) (31) (3)
Adjusted net profit 143.3 60.1 +83
Net profit (Group share) 128.0 (72.2) +200
Simplified cash flow      
In EUR million Q3 2021 Q3 2020 Growth
Operating cash flow 263 99 +164
Unlevered free cash flow 202 51 +151









10.11.2021 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
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Language: English
Company: SYNLAB AG
Moosacher Straße 88
80809 Munich
Phone: +49 1701183753
Indices: SDAX
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange
EQS News ID: 1247629

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Last Updated: 17-Nov-2021