Guerbet Dives into the Red: Losses of €112.7M Following Raleigh Site Crisis
In 2025, Guerbet recorded a turnover of €786.4 million, a decrease of 3.5% at constant exchange rates and comparable scope. Despite this contraction, the French laboratory maintained its adjusted EBITDA margin at 12.0%, at the higher end of its range, and generated a positive Free Cash Flow of €19.2 million. However, major compliance issues at its American site in Raleigh threaten its financial structure and expose it to a probable breach of its banking covenants by June 30, 2026.
Financial Performance in 2025
Guerbet closed the 2025 fiscal year with a turnover of €786.4 million, down 3.5% at constant exchange rates and comparable scope. This decline is primarily due to two factors: contraction of activities in France, which otherwise would have stabilized the group's sales, and issues in Raleigh during the fourth quarter. Currency impacts were significant, with depreciation of the dollar, Brazilian real, and South Korean won accounting for €22.8 million. Despite this downturn, Guerbet demonstrated remarkable cost discipline, reducing personnel expenses by 7.2% and external expenses by 6.5%. Consequently, the adjusted EBITDA margin stood at 12.0% of turnover, at the upper end of the adjusted range communicated in December (between 10.5% and 12%), compared to 14.9% in 2024. This relative resilience, however, masks a significantly degraded operational profitability: gross EBITDA accounted for only 10.5% of turnover, impacted by exceptional reorganization costs estimated at €12.2 million.
Cash Flow and Net Results
In terms of cash flow, Guerbet shows mixed results. The Free Cash Flow was positive at €19.2 million, a remarkable improvement compared to the €9.1 million deficit in 2024, notably driven by significant improvements in working capital requirements and optimization of customer payment terms. However, the net result plummeted to -€112.7 million, weighed down by an exceptional depreciation of €86 million recorded following impairment tests on the Raleigh site, and a provision of €10 million for stock destructions. These elements, although purely accounting according to the group, reflect a significant weakening of equity: equity fell from €394 million to €267 million over the year. Net financial debt slightly improved, moving from €344.9 million to €325.7 million, bringing the debt ratio to 4.0x EBITDA, below the ceiling of 4.8x set in December in the waiver obtained from lenders.
Operational Crisis at Raleigh Site
The real threat to Guerbet lies in the operational crisis at the Raleigh site in North Carolina. Compliance issues identified by the Food and Drug Administration led to a decrease in turnover in the fourth quarter of 2025 and require the group to maintain a lower-than-normal batch release rate. The group anticipates a significant negative impact on its activity, profitability, and cash generation in 2026. Particularly concerning: Guerbet signals a probable risk of breaching the financial debt-to-EBITDA ratio of 3.5x tested on June 30, 2026. Should this materialize, lenders could declare the debt due early from the second half of 2026, potentially leading to a liquidity crisis. The group relies on the continuation of the compliance plan and obtaining an additional waiver from its creditors. The site is expected to reach a normative level of release by the end of 2026, allowing the group to operate under normal conditions throughout 2027. The Board of Directors will also propose at the general meeting on May 22, 2026, not to distribute dividends for 2025, giving priority to strengthening cash reserves.
