UPDATE 1-Lonza says 2010 outlook unchanged

* Lonza says Q1 mkt demand at last year’s level

* Expects savings of Sfr 70-80 mln by end Q1 2011

* Better visibility in life sciences, bioscience

ZURICH, April 22 (BestGrowthStock) – Drugs industry supplier Lonza
Group Ltd (LONN.VX: ) said its outlook for 2010 remained unchanged
after first-quarter market demand stayed at last year’s level,
indicating pharma clients were still keen to rein in costs.

The Swiss group, which has been hit by drugmakers cutting
inventories, on Thursday said it expected to save 70-80 million
Swiss francs ($65.60 million) by the end of the first-quarter of

“Although the environment remains volatile and we are not
yet trusting the stronger demand to represent true and full
economic recovery, the progress in the first quarter is
encouraging,” Stefan Borgas, chief executive, said.

Lonza said there had been strong performance in the first
quarter in life science ingredients, which along with the
bioscience division was experiencing better visibility.

It said the pipeline in custom manufacturing, which is the
largest division in terms of sales, remained strong.

Lonza has moved away from specialty chemicals to focus on
higher-margin pharmaceutical ingredients.

But some drugmakers, faced with tougher paths to get their
medicines to market, are becoming increasingly cost conscious
and prefer to keep some manufacturing in-house rather than using
companies like Lonza.

The company said in January business would remain unstable
and customers were increasingly cost conscious. Its net profit
dropped 62 percent in 2009. [ID:nLDE60Q0LX]

Lonza trades at about 13 times forecast 2011 earnings, at a
premium to drugmakers Roche (ROG.VX: ) and Novartis (NOVN.VX: ).

Stock Market Trading

(Editing by Mike Nesbit)
($1=1.067 Swiss Franc)

UPDATE 1-Lonza says 2010 outlook unchanged