FY25 results are largely in line with the trading update given in January, save for cash levels, which are lower on higher exceptionals and working capital drag as big pharma has slowed its payment terms. Whilst we make no changes to our P&L forecasts, which are prudently pitched towards the lower end of consensus, we adjust our FCF forecasts to reflect this new state of play. This impacts on our DCF valuation in particular and we revise our TP accordingly to 205p (from 243p), now based on 3.5x EV/Sales (from 4.0x) and a 10yr DCF. Whilst we stay at Buy, our conviction is reduced and the market may take some time to digest this new dynamic.
