Samsung Biologics Co., a biopharmaceutical unit of Samsung Group, surprised the market after delivering an all-time high operating income of 166.8 billion won ($144.6 million) for the second quarter on the back of surge in contract manufacturing orders for Covid-19 vaccines and treatments.

Samsung Biologics disclosed Tuesday that its operating profit in the April-June period doubled on year and on quarter to record 166.8 billion won, well above analysts’ consensus of 112.3 billion won.

Sales totaled at 412.2 billion won, up 58 percent on quarter and 34 percent on year. Its net income reached 121.5 billion won soaring 133.6 percent from a year prior and 99.3 percent from three months ago.

Shares of Samsung Biologics finished Wednesday down 0.22 percent at 906,000 won.

The robust results came despite the rise in general and administrative expenses resulting from hiring new employees.

The company attributed the surprising results to strong demand for biopharmaceuticals in general amid the Covid-19 outbreak and increased contract manufacturing orders. In May, it won procurement from Moderna to package its coronavirus vaccine. The surge in new CMO orders led to increased output at its third factory in Songdo complex, west of Incheon.

It has also been working on rationalizing production facilities to better respond to the market demand, which helped the company to drastically reduce the technology transfer period required to produce Covid-19 antibody treatments for U.S. pharmaceutical company Eli Lilly.

The company said it expects the sales growth to continue as it is expanding its CMO capacity with its fourth plant in Songdo which will begin operation in 2023.

It will also explore various applications of mRNA vaccine technology through the momentum of consignment production for Moderna vaccine from the third quarter.

“We will be adding a facility dedicated to producing mRNA bulk drug substance by the first half of 2022, which will enable us to provide end-to-end services manufacturing both drug substance and finished drug products,” an official at Samsung Biologics said.

By Kim Si-gyun and Lee Soo-min

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