Catalent expects ‘productivity issues’ to affect earnings
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New Jersey-based Catalent Inc. (NYSE: CTLT) expects productivity issues at three of its facilities, including one in Bloomington, will “materially and adversely impact” its fiscal third quarter financial results, the company said Friday.
The contract development manufacturing organization that focuses on the biopharmaceutical industry said it was “unable to achieve anticipated productivity levels” at the Bloomington plant.
Catalent also cited higher-than-expected costs at the facility in Bloomington, as well as its manufacturing facility in Brussels, Belgium. The company said the low productivity levels and associated revenue are due in part to “the continued need to implement enhancements to its operational and engineering controls following regulatory inspections that occurred earlier in the fiscal year.”
The company said it expects productivity levels to be restored to previously forecast levels in the fiscal fourth quarter, which ends on June 30.
The news comes about fourth months after Catalent laid off about 400 workers in Bloomington, citing a decline in demand for COVID-19 vaccines, which the facility produces along with other products.
Additionally, Catalent said it experienced productivity issues at its gene therapy manufacturing site in Harmans, Maryland near the BWI airport. The company said its plans to increase capacity for a customer’s product during the fiscal third quarter was slower than expected, and similar regulatory inspections also contributed to the results.
The company said it conducted an internal review of its manufacturing operations at all three facilities and has taken measures to “address the root causes of the issues identified at each site,” including management and operational changes.
Catalent is expected to release its fiscal third quarter earnings report on May 9.
Also on Friday, Catalent announced Rick Hopson will serve as interim chief financial officer, following the resignation of Thomas Castellano on Wednesday. Hopson previously served as president, division head for clinical development and supply at Catalent.
“Ricky is an experienced financial executive who deeply understands Catalent and can successfully lead our financial function through this interim period until we identify a new, permanent CFO,” Catalent CEO Alessandro Maselli said in a news release.
Hopson previously served as Catalent’s chief accounting officer along with several other finance-related positions.