8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) – February 15, 2023

WEST PHARMACEUTICAL SERVICES, INC.

(Exact name of registrant as specified in its charter)

Pennsylvania	1-8036	23-1210010
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
530 Herman O. West Drive, Exton, PA		19341-0645
(Address of principal executive offices)		(Zip Code)

 Registrant’s telephone number, including area code: 610-594-2900

Not Applicable

(Former name or address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.25 per share	WST	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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Item 2.02 Results of Operations and Financial Condition.

On February 16, 2023, West Pharmaceutical Services, Inc. (the “Company”) issued a press release announcing its fourth-quarter and full year 2022 financial results. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

The information set forth in “Item 2.02 Results of Operations and Financial Condition,” including the exhibit referred to therein, is incorporated herein by reference.

A copy of the Company’s presentation materials used during the call will be available through the Investors link at the Company’s website, http://www.westpharma.com, and is also attached hereto as Exhibit 99.2 and incorporated herein by reference.

The information in this report (including the exhibits attached hereto) is being furnished pursuant to Item 2.02 and Item 7.01 and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (“Exchange Act”), or otherwise subject to the liabilities of that section, nor will it be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific referencing in such filing.

Item 8.01 Other Events.

On February 15, 2023, the Board of Directors approved a share repurchase program under which we may repurchase up to $1.0 billion in shares of common stock. The share repurchase program does not have an expiration date under which we repurchase, from time to time, common stock on the open market or in privately-negotiated transactions, as permitted under Exchange Act Rule 10b-18. The number of shares to be repurchased and the timing of such transactions will depend on a variety of factors, including market conditions. The Company's previously-authorized share repurchase program expired on December 31, 2022.

Item 9.01 Financial Statements and Exhibits.

(d)	Exhibit No.	Description
	99.1	West Pharmaceutical Services, Inc. Press Release, dated February 16, 2023.
	99.2	West Pharmaceutical Services, Inc. Presentation, dated February 16, 2023.
	104	The cover page from the Company’s Current Report on Form 8-K, dated February 15, 2023, formatted in Inline XBRL.

2

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	WEST PHARMACEUTICAL SERVICES, INC.
	/s/ Bernard J. Birkett
	Bernard J. Birkett
	Senior Vice President, Chief Financial and Operations Officer
February 16, 2023

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EXHIBIT INDEX

Exhibit No.	Description
99.1	West Pharmaceutical Services, Inc. Press Release, dated February 16, 2023.
99.2	West Pharmaceutical Services, Inc. Presentation, dated February 16, 2023.
104	The cover page from the Company’s Current Report on Form 8-K, dated February 15, 2023, formatted in Inline XBRL.

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EX-99.1

Exhibit 99.1

West Announces Fourth-Quarter and Full-Year 2022 Results

- Conference Call Scheduled for 9 a.m. EDT Today-

Exton, PA, February 16, 2023 – West Pharmaceutical Services, Inc. (NYSE: WST) today announced its financial results for the fourth-quarter and full-year 2022 and introduced full-year 2023 financial guidance.

Fourth-Quarter and Full-Year 2022 Summary (comparisons to prior-year period)

•Fourth-quarter 2022 net sales of $708.7 million declined 3.0%; organic net sales growth was 2.6%. Full-year 2022 net sales of $2.887 billion grew 2.0%; organic net sales growth was 7.7%.

•Fourth-quarter 2022 reported-diluted EPS of $1.36 decreased 29.5%. Full-year 2022 reported-diluted EPS of $7.73 decreased 10.8%.

•Fourth-quarter 2022 adjusted-diluted EPS of $1.77 decreased 13.2%. Full-year 2022 adjusted-diluted EPS of $8.58 was flat compared to last year.

•The Company is introducing full-year 2023 financial guidance of net sales in a range of $2.935 billion to $2.960 billion and adjusted-diluted EPS in a range of $7.25 to $7.40.

•The Board of Directors approved a share repurchase program under which the Company may repurchase up to $1.0 billion in shares of common stock. This program does not have a specified expiration date. The Company's previously-authorized share repurchase program expired on December 31, 2022.

“Adjusted-diluted EPS” and “organic net sales growth” are Non-U.S. GAAP measurements. See discussion under the heading “Non-U.S. GAAP Financial Measures” in this release.

“I am pleased to report that we had a solid finish to 2022 and that we enter 2023 with a strong order book and continued demand for our core business,” said Eric M. Green, President, Chief Executive Officer and Chair of the Board of Directors. “I am extremely proud of the many accomplishments by our global team members, as our Company has supplied critical components, solutions and systems to our base and COVID-19 related customers. Though pandemic-related product demand is declining, we continue to see overall demand growth, especially from our biologic customers. We are managing our cost structure to address an ongoing inflationary environment and remain committed to a capital spending program that expands our high-value product (HVP) manufacturing capacity to stay ahead of our accelerating customer demand from recent launches and anticipated drug programs in the coming years.”

Proprietary Products Segment

In the fourth-quarter 2022, net sales declined by 4.0% to $584.8 million. Organic net sales growth was 1.8%, with currency translation decreasing net sales growth by 580 basis points. HVP components and devices represented approximately 72% of segment net sales and had flat net organic sales growth compared to the prior year.

The Generics market unit had double-digit organic net sales growth, and the Pharma market unit had high-single digit organic net sales growth. The Biologics market unit had organic net sales decline of mid-single digit primarily due to a reduction in sales related to COVID-19 vaccines. In the quarter, Proprietary Product organic net sales performance was led by double-digit sales growth of Envision®, Crystal Zenith®, and film-coated component categories, which were offset by a decline in NovaPure® sales related to COVID-19 vaccines.

In the full-year 2022, net sales grew 3.9% to $2.407 billion. Organic net sales growth was 9.8%, with currency translation decreasing net sales growth by 590 basis points. HVP components and devices represented approximately 73% of segment net sales and generated double-digit organic net sales growth.

Contract-Manufactured Products Segment

In the fourth-quarter 2022, net sales grew by 2.0% to $123.9 million. Organic net sales grew by 7.0%, with currency translation decreasing net sales growth by 500 basis points. Segment performance was led by growth in medical device products.

In the full-year 2022, net sales declined by 6.7% to $480.4 million. Organic net sales declined by 2.0%, with currency translation decreasing net sales growth by 470 basis points.

Full-Year 2022 Financial Highlights

Operating cash flow was $724.0 million, an increase of 24.0%. Capital expenditures were $284.6 million, compared with $253.4 million in 2021. Free cash flow (operating cash flow minus capital expenditures) was $439.4 million, an increase of 32.9%.

During the year ended December 31, 2022, we purchased 563,334 shares of our common stock under the now completed program at a cost of $202.8 million, or an average price of $360.03 per share. The Board of Directors has approved a new share repurchase program under which the Company may repurchase up to $1.0 billion in shares of common stock. Repurchases may be made at management’s discretion from time to time on the open market or through privately-negotiated transactions. This program does not have a specified expiration date. The number of shares to be repurchased will depend on a variety of factors, including economic and market conditions, corporate and regulatory requirements, prevailing stock prices and other considerations.

Introducing Full-Year 2023 Financial Guidance

•Full-year 2023 net sales are expected to be in a range of $2.935 billion to $2.960 billion.

◦Organic net sales growth is expected to be approximately 3% to 4%.

◦Net sales guidance assumes COVID-19 related sales of approximately $85 million, compared to $388 million in 2022.

◦Net sales guidance includes an estimated full-year 2023 headwind of $30 million based on current foreign currency exchange rates.

•Full-year 2023 adjusted-diluted EPS is expected to be in a range of $7.25 to $7.40.

◦Full-year adjusted-diluted EPS guidance range includes an estimated headwind of approximately $0.11 based on current foreign currency exchange rates.

◦This adjusted-diluted EPS guidance range assumes a full-year 2023 tax rate of approximately 23%, which does not include potential tax benefits from stock-based compensation. As in prior years, we are not including potential 2023 tax benefits from stock-based compensation, as they are out of the Company's control. Any tax benefits associated with stock-based compensation that we receive in 2023 would provide a positive adjustment to our full-year EPS guidance.

•Full-year 2023 capital spending is expected to be $350 million. This includes incremental capital spending to support capacity expansions at existing HVP facilities.

Fourth-Quarter 2022 Conference Call

The Company will host a conference call to discuss the results and business expectations at 9:00 a.m. Eastern Time today. The live audio-only webcast will be made available via the Company's Investor Relations website at https://edge.media-server.com/mmc/p/p2xjj2i9.

To participate and ask questions during the conference call, you must register in advance at https://register.vevent.com/register/BI1f11a77df69a4881b62339db131c3128. Upon registration, all telephone participants will receive the dial-in number along with a unique PIN number that will be used to access the call.

Management will refer to a slide presentation during the call, which will be made available on the day of the call. To view the presentation, select "Presentations" in the "Investors" section of the Company's website.

A replay of the conference call and webcast will be available on the Company's website for 30 days.

Investor Contact:	Media Contact:
Quintin Lai	Michele Polinsky
Vice President, Investor Relations	Vice President, Global Communications
(610) 594-3318	(610) 594-3054
Quintin.Lai@westpharma.com	Michele.Polinsky@westpharma.com

Forward-Looking Statements

This release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may include such words as “introducing,” “may,” “continue”, “see,” “remain,” “committed,” “expands,” “depend,” “continuation,” “could,” “expected,” “assumes,” “includes,” “provide” and other similar terminology. These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this release. There is no certainty that actual results will be achieved in-line with current expectations. These forward-looking statements involve a number of risks and uncertainties. The following are some of the factors that could cause our actual results to differ materially from those expressed in or underlying our forward-looking statements: the prolonged effects of the global COVID-19 pandemic, including prevailing economic conditions and general uncertainties relating thereto that may be unknown and unforeseeable; customers’ changing inventory requirements and manufacturing plans and customer decisions to move forward with our new products and product categories; other potential impacts from COVID-19, including interruptions or weaknesses in our supply chain, illness in our workforce and access to transport for our products; disruptions or limitations in the Company’s manufacturing capacity; average profitability, or mix, of the products we sell; dependence on third-party suppliers and partners; increased raw material, energy and labor costs; fluctuations in currency exchange; and the ability to meet development milestones with key customers; and the consequences of other geopolitical events, including natural disasters, acts of war, and global health crises. This list of important factors is not all inclusive. For a description of certain additional factors that could cause the Company’s future results to differ from those expressed in any such forward-looking statements, see Part I Item 1A, entitled “Risk Factors,” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, and other filings with the United States Securities and Exchange Commission, including the Company’s quarterly reports on Form 10-Q and current reports on Form 8-K.

Except as required by law or regulation, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

Non-U.S. GAAP Financial Measures

This release contains certain non-GAAP financial measures, including organic net sales and adjusted-diluted EPS. For the purpose of aiding the comparison of our year-over-year results, we may refer to net sales and other financial results excluding the effects of changes in foreign currency exchange rates. Organic net sales exclude the impact from acquisitions and/or divestitures and translate the current-period reported sales of subsidiaries whose functional currency is other than the U.S. Dollar at the applicable foreign currency exchange rates in effect during the comparable prior-year period. We may also refer to financial results excluding the effects of unallocated items. The re-measured results excluding effects from currency translation and excluding the effects of unallocated items are not in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) and should not be used as a substitute for the comparable U.S. GAAP financial measures. The non-U.S. GAAP financial measures are incorporated into our discussion and analysis as management uses them in evaluating our results of operations and believes that this information provides users a valuable insight into our overall performance and financial position. A reconciliation of these adjusted non-U.S. GAAP measures to the comparable U.S. GAAP financial measures is included in the accompanying tables.

WEST PHARMACEUTICAL SERVICES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

(in millions, except per share data)

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2022			2021			2022			2021
Net sales	$	708.7	100%	$	730.8	100%	$	2,886.9	100%	$	2,831.6	100%
Cost of goods and services sold	446.6		63	430.2		59	1,750.7		61	1,655.8		58
Gross profit	262.1		37	300.6		41	1,136.2		39	1,175.8		42
Research and development	15.9		2	13.7		2	58.5		2	52.8		2
Selling, general and administrative expenses	85.7		12	98.0		13	316.9		11	362.8		13
Other expense (income), net	30.8		5	4.9		1	26.8		1	7.9		—
Operating profit	129.7		18	184.0		25	734.0		25	752.3		27
Interest expense (income), net	(1.2)		—	2.3		—	2.8		—	7.2		—
Other nonoperating expense (income)	2.2		—	(0.2)		—	51.3		2	(3.8)		—
Income before income taxes and equity in net income of affiliated companies	128.7		18	181.9		25	679.9		23	748.9		27
Income tax expense	28.9		4	34.2		5	114.7		4	107.2		4
Equity in net income of affiliated companies	(3.2)		(1)	—		—	(20.7)		(1)	(20.1)		(1)
Net income	$	103.0	15%	$	147.7	20%	$	585.9	20%	$	661.8	24%
Net income per share:
Basic	$	1.38		$	1.98		$	7.87		$	8.89
Diluted	$	1.36		$	1.93		$	7.73		$	8.67
Average common shares outstanding	74.4			74.5			74.4			74.4
Average shares assuming dilution	75.6			76.4			75.8			76.3

WEST PHARMACEUTICAL SERVICES

REPORTING SEGMENT INFORMATION

(UNAUDITED)

(in millions)

	Three Months Ended December 31,						Twelve Months Ended December 31,
Net Sales:	2022			2021			2022			2021
Proprietary Products	$	584.8		$	609.3		$	2,406.8		$	2,317.3
Contract-Manufactured Products	123.9			121.5			480.4			514.7
Eliminations	—			—			(0.3)			(0.4)
Consolidated Total	$	708.7		$	730.8		$	2,886.9		$	2,831.6
Gross Profit:
Proprietary Products	$	243.0		$	282.4		$	1,053.3		$	1,093.9
Contract-Manufactured Products	19.1			20.1			82.9			83.8
Unallocated items	—			(1.9)			—			(1.9)
Gross Profit	$	262.1		$	300.6		$	1,136.2		$	1,175.8
Gross Profit Margin	37.0		%	41.1		%	39.4		%	41.5		%
Operating Profit (Loss):
Proprietary Products	$	168.5		$	201.8		$	784.4		$	796.1
Contract-Manufactured Products	12.4			15.3			60.4			67.2
Stock-based compensation expense	(6.7)			(10.0)			(23.7)			(37.5)
General corporate costs	(15.5)			(17.9)			(59.1)			(63.4)
Adjusted Operating Profit	$	158.7		$	189.2		$	762.0		$	762.4
Adjusted Operating Profit Margin	22.4		%	25.9		%	26.4		%	26.9		%
Unallocated items	(29.0)			(5.2)			(28.0)			(10.1)
Reported Operating Profit	$	129.7		$	184.0		$	734.0		$	752.3
Reported Operating Profit Margin	18.3		%	25.2		%	25.4		%	26.6		%

WEST PHARMACEUTICAL SERVICES

RECONCILIATION OF NON-U.S. GAAP MEASURES (UNAUDITED)

Please refer to “Non-U.S. GAAP Financial Measures” for more information

(in millions, except per share data)

Reconciliation of Reported and Adjusted Operating Profit, Net Income and Diluted EPS

Three Months Ended December 31, 2022	Operating profit	Income tax expense	Net income	Diluted EPS
Reported (U.S. GAAP)	$129.7	$28.9	$103.0	$1.36
Restructuring and related charges (1)	25.4	2.4	23.0	0.30
Pension settlement (2)	—	0.3	0.9	0.02
Amortization of acquisition-related intangible assets (3)	0.1	—	0.7	0.01
Cost investment activity (5)	3.5	—	3.5	0.05
Tax law changes (7)	—	(2.5)	2.5	0.03
Adjusted (Non-U.S. GAAP)	$158.7	$29.1	$133.6	$1.77

Twelve Months Ended December 31, 2022	Operating profit	Income tax expense	Net income	Diluted EPS
Reported (U.S. GAAP)	$734.0	$114.7	$585.9	$7.73
Restructuring and related charges (1)	23.8	2.0	21.8	0.29
Pension settlement (2)	—	20.6	31.6	0.42
Amortization of acquisition-related intangible assets (3)	0.7	0.1	2.8	0.04
Cost investment activity (5)	3.5	—	3.5	0.05
Royalty acceleration (6)	—	1.3	(1.3)	(0.02)
Tax law changes (7)	—	(5.7)	5.7	0.07
Adjusted (Non-U.S. GAAP)	$762.0	$133.0	$650.0	$8.58

Three Months Ended December 31, 2021	Operating profit	Income tax expense	Net income	Diluted EPS
Reported (U.S. GAAP)	$184.0	$34.2	$147.7	$1.93
Pension settlement (2)	—	0.3	0.8	0.01
Cost investment activity (5)	2.5	—	2.5	0.03
Restructuring and related charges (1)	(0.3)	(0.1)	(0.2)	—
Amortization of acquisition-related intangible assets (3)	0.2	—	0.7	0.01
Asset impairment (4)	2.8	—	2.8	0.04
Royalty acceleration (6)	—	(2.0)	2.0	0.02
Adjusted (Non-U.S. GAAP)	$189.2	$32.4	$156.3	$2.04

Twelve Months Ended December 31, 2021	Operating profit	Income tax expense	Net income	Diluted EPS
Reported (U.S. GAAP)	$752.3	$107.2	$661.8	$8.67
Pension settlement (2)	—	0.5	1.5	0.02
Cost investment activity (5)	4.3	(0.1)	4.4	0.06
Restructuring and related charges (1)	2.2	0.4	1.8	0.02
Amortization of acquisition-related intangible assets (3)	0.8	0.1	2.8	0.04
Asset impairment (4)	2.8	—	2.8	0.04
Royalty acceleration (6)	—	18.5	(18.5)	(0.25)
Tax law changes (7)	—	1.4	(1.4)	(0.02)
Adjusted (Non-U.S. GAAP)	$762.4	$128.0	$655.2	$8.58

(1)During the three and twelve months ended December 31, 2022, the Company recorded restructuring and related charges of $25.4 million and $23.8 million, respectively. The twelve-month charge primarily includes $8.7 million in net severance and post-employment benefits primarily in connection with our plan to adjust our operating cost base and $15.3 million in asset-related charges associated with this plan. During the three and twelve months ended December 31, 2021, the Company recorded a restructuring and severance related benefit of $0.3 million and charge of $2.2 million.

(2)During the three and twelve months ended December 31, 2022, the Company recorded pension settlement charges of $1.2 million and $52.2 million, respectively, within other nonoperating expense (income), which primarily relates to the full settlement of the U.S. qualified defined benefit plan (the “U.S. pension plan”). During 2021, the Company recorded a pension settlement charge within other nonoperating expense (income), as it determined that normal-course lump-sum payments for our U.S. pension plan exceeded the threshold for settlement accounting.

(3)During the three and twelve months ended December 31, 2022, the Company recorded $0.1 million and $0.7 million, respectively, of amortization expense within operating profit associated with an acquisition of an intangible asset during the second quarter of 2020. During the three and twelve months ended December 31, 2021, the Company recorded $0.2 million and $0.8 million, respectively, of amortization expense within operating profit associated with an acquisition of an intangible asset during the second quarter of 2020. During the three and twelve months ended December 31, 2022 and 2021, the company recorded$0.5 million and $2.1 million, respectively, of amortization expense in association withan acquisition of increased ownership interest in Daikyo.

(4)During 2021, the Company recorded a $2.8 million impairment charge of certain long-lived and intangible assets within the Proprietary Products segment as it determined the carrying value exceeded the fair value of the assets. $1.9 million of this charge is recorded in Cost of Goods and Services Sold and $0.9 million of the charge is recorded in Selling, General, and Administrative expense, due to the nature of the impaired assets.

(5)During the three and twelve months ended December 31, 2022, the Company recorded a cost investment impairment charge of $3.5 million. During the three months ended December 31, 2021, the Company recorded a cost investment impairment charge of $2.5 million. During the twelve months ended December 31, 2021, the net cost investment activity was $4.3 million, inclusive of an impairment charge of $4.6 million offset by a $0.3 million gain on the sale of a cost investment.

(6)During 2022, the Company increased its expected tax benefit related to the prepayment of future royalties from one of its subsidiaries by $1.3 million. During the twelve months ended December 31, 2021, the Company prepaid future royalties from one of its subsidiaries.

(7)During the three and twelve months ended December 31, 2022, the Company incurred $2.5 million and $5.7 million, respectively, of additional tax expense due to the impact of a tax law change in the state of Pennsylvania enacted during the period. During the twelve months ended December 31, 2021, the Company recorded a tax benefit of $1.4 million due to the impact of a United Kingdom tax law change enacted during the period.

WEST PHARMACEUTICAL SERVICES

RECONCILIATION OF NON-U.S. GAAP FINANCIAL MEASURES (UNAUDITED)

Please refer to “Non-U.S. GAAP Financial Measures” for more information

(in millions, except per share data)

Reconciliation of Net Sales to Organic Net Sales (8)

Three Months Ended December 31, 2022	Proprietary	CM	Eliminations	Total
Reported net sales (U.S. GAAP)	$584.8	$123.9	$—	$708.7
Effect of changes in currency translation rates	35.3	6.0	—	41.3
Organic net sales (Non-U.S. GAAP) (8)	$620.1	$129.9	$—	$750.0

Twelve Months Ended December 31, 2022	Proprietary	CM	Eliminations	Total
Reported net sales (U.S. GAAP)	$2,406.8	$480.4	$(0.3)	$2,886.9
Effect of changes in currency translation rates	138.6	24.0	—	162.6
Organic net sales (Non-U.S. GAAP) (8)	$2,545.4	$504.4	$(0.3)	$3,049.5

(8)Organic net sales exclude the impact from acquisitions and/or divestitures and translate the current-period reported sales of subsidiaries whose functional currency is other than the U.S. Dollar at the applicable foreign currency exchange rates in effect during the comparable prior-year period.

WEST PHARMACEUTICAL SERVICES

CASH FLOW ITEMS

(UNAUDITED)

(in millions)

	Twelve Months Ended December 31,
	2022	2021
Depreciation and amortization	$120.6	$122.3
Operating cash flow	$724.0	$584.0
Capital expenditures	$284.6	$253.4
Free cash flow	$439.4	$330.6

WEST PHARMACEUTICAL SERVICES

FINANCIAL CONDITION

(UNAUDITED)

(in millions)

	As of December 31, 2022	As of December 31, 2021
Cash and cash equivalents	$894.3	$762.6
Accounts receivable, net	$507.4	$489.0
Inventories	$414.8	$378.4
Accounts payable	$215.4	$232.2
Debt	$208.9	$253.0
Equity	$2,684.9	$2,335.4
Working capital	$1,400.5	$1,147.9

WEST PHARMACEUTICAL SERVICES

RECONCILIATION OF REPORTED-DILUTED EPS GUIDANCE TO ADJUSTED-DILUTED EPS GUIDANCE

(UNAUDITED)

	2022 Actual	2023 Guidance	% Change
Reported-diluted EPS (U.S. GAAP)	$7.73	$7.21 to $7.36	(6.7%) to (4.8%)
Restructuring and related charges	0.29	—	—
Pension settlement	0.42	—	—
Amortization of acquisition-related intangible assets	0.04	0.04	—
Cost investment activity	0.05	—	—
Royalty acceleration	(0.02)	—	—
Tax law changes	0.07	—	—
Adjusted-diluted EPS (Non-U.S. GAAP) (9)	$8.58	$7.25 to $7.40	(15.5%) to (13.8%)

(9)See “Full-year 2023 Financial Guidance” and “Non-U.S. GAAP Financial Measures” in today’s press release for additional information regarding adjusted-diluted EPS.

We have opted not to forecast 2023 tax benefits from stock-based compensation in upcoming quarters, as they are out of the Company’s control. Instead, we recognize the benefits as they occur. In 2022, tax benefits associated with stock-based compensation increased adjusted-diluted EPS by $0.22. Any future tax benefits associated with stock-based compensation that we receive in 2023 would provide a positive adjustment to our full-year EPS guidance.

Trademark Notices

Trademarks and registered trademarks are the property of West Pharmaceutical Services, Inc., in the United States and other jurisdictions, unless noted otherwise.

Daikyo Crystal Zenith® and Daikyo CZ® are registered trademarks of Daikyo Seiko, Ltd. Daikyo Crystal Zenith technologies are licensed from Daikyo Seiko, Ltd.

EX-99.2

1 Fourth-Quarter 2022 and Full Year Results Fourth Quarter Overall Net Sales $708.7M | 3.0% Diluted Earnings Per Share: $1.36 Adjusted Diluted Earnings Per Share: $1.77 Eric M. Green President and Chief Executive Officer Chair of the Board West Pharmaceutical Services, Inc. WST Q4/FY 2022 Earnings Cautionary Statement Under the Private Securities Litigation Reform Act of 1995 This presentation and any accompanying management commentary contain “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about product development and operational performance. Each of these statements is based on preliminary information, and actual results could differ from any preliminary estimates. We caution investors that the risk factors listed under “Cautionary Statement” in our press releases, as well as those set forth under the caption "Risk Factors" in our most recent Annual Report on Form 10-K as filed with the Securities and Exchange Commission and as revised or supplemented by our quarterly reports on Form 10-Q, could cause our actual results to differ materially from those estimated or predicted in the forward-looking statements. You should evaluate any statement in light of these important factors. Except as required by law or regulation, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise. Non-U.S. GAAP Financial Measures Certain financial measures included in these presentation materials, or which may be referred to in management’s discussion of the Company’s results and outlook, have not been calculated in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”), and therefore are referred to as non- U.S. GAAP financial measures. Non-U.S. GAAP financial measures should not be considered in isolation or as an alternative to such measures determined in accordance with U.S. GAAP. Please refer to “Reconciliation of Non-U.S. GAAP Financial Measures” at the end of these materials for more information. “I am pleased to report that we had a solid finish to 2022 and that we enter 2023 with a strong order book and continued demand for our core business. I am extremely proud of the many accomplishments by our global team members, as our Company has supplied critical components, solutions and systems to our base and COVID-19 related customers.” Full Year Overall Net Sales $2.887B | 2.0% Diluted Earnings Per Share: $7.73 Adjusted Diluted Earnings Per Share: $8.58

West Pharmaceutical Services, Inc. Eric M. Green President & CEO, Chair of the Board Bernard J. Birkett Senior VP & Chief Financial and Operations Officer Fourth-Quarter and Full Year Results 2022 Analyst Conference Call 9 a.m. Eastern Time | February 16, 2023

3 West Analyst Conference Call 9 a.m. Eastern Time February 16, 2023 A webcast of today’s call can be accessed in the “Investors” section of the Company’s website: www.westpharma.com To participate on the call by asking questions to Management, please register in advance at: https://register.vevent.com/register/BI1f11a77df69a4881b623 39db131c3128 Upon registration, all telephone participants will receive the dial-in number along with a unique PIN number that will be used to access the call. A replay of the conference call and webcast will be available on the Company’s website for 30 days. These presentation materials are intended to accompany today’s press release announcing the Company’s results for the fourth quarter and full year 2022 and management’s discussion of those results during today’s conference call. WST Q4/FY 2022 Earnings

4 Safe Harbor Statement This presentation and any accompanying management commentary contain “forward- looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about product development, operational performance and expectations regarding future events. Each of these statements is based on preliminary information, and actual results could differ from any preliminary estimates. We caution investors that the risk factors listed under our “Forward Looking Statements” in our press releases, as well as those set forth under the caption "Risk Factors" in our most recent Annual Report on Form 10-K as filed with the Securities and Exchange Commission and as revised or supplemented by our quarterly reports on Form 10-Q, could cause our actual results to differ materially from those estimated or predicted in the forward-looking statements. You should evaluate any statement in light of these important factors. Except as required by law or regulation, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise. Certain financial measures included in these presentation materials, or which may be referred to in management’s discussion of the Company’s results and outlook, have not been calculated in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”), and therefore are referred to as non-U.S. GAAP financial measures. Non-U.S. GAAP financial measures should not be considered in isolation or as an alternative to such measures determined in accordance with U.S. GAAP. Please refer to “Reconciliation of Non-U.S. GAAP Financial Measures” at the end of these materials for more information. Cautionary Statement Under the Private Securities Litigation Reform Act of 1995 Non-U.S. GAAP Financial Measures Trademarks and registered trademarks used in this report are the property of West Pharmaceutical Services, Inc. or its subsidiaries, in the United States and other jurisdictions, unless noted otherwise. Daikyo Crystal Zenith® and Daikyo CZ® are registered trademarks of Daikyo Seiko, Ltd. Daikyo Crystal Zenith technologies are licensed from Daikyo Seiko, Ltd. Trademarks WST Q4/FY 2022 Earnings

5 “Keep everlastingly at it.” Herman O. West West Founder April 14, 1923 Over the course of our 100-year history the West name has come to mean so much to so many people. The future innovations we’ll advance across the next 100 years will allow us to have a greater and more positive impact on the world, as we firmly stand by the side of our customers and patients, in new and exciting ways. WST Q4/FY 2022 Earnings 5

6 Financial Highlights WST Q4/FY 2022 Earnings • Fourth quarter 2022 net sales of $708.7 million declined 3.0%; organic net sales growth was 2.6% • Fourth quarter 2022 reported-diluted EPS of $1.36 compared to $1.93 in the same period last year; adjusted-diluted EPS of $1.77 compared to $2.04 in the same period last year • Full year 2022 net sales of $2.887 billion grew 2.0%; organic net sales growth was 7.7% • Full year 2022 reported-diluted EPS of $7.73 compared to $8.67 in the same period last year; adjusted-diluted EPS of $8.58 remained consistent with the same period last year

7 Donated over $2.75M to our local communities to help those in greatest need Published over 100 scientific peer-reviewed and industry publications 600+ new team members joined West Shipped close to 47 billion components touching billions of patients Established landmark collaboration with Corning in Pharmaceutical injectable drug delivery Introduced Daikyo CZ® 2.25mL insert needle syringe system Customers received three drug approvals using SmartDose® device Advanced our ESG 5-year goals with purpose driven mindset 2022 Business Highlights Expanded capacity at 13 existing sites with 110 major facility modifications and over 690 pieces of equipment WST Q4/FY 2022 Earnings

8 Purpose. Driven. ESG Priorities for 2022 and beyond WST Q4/FY 2022 Earnings Climate Strategy R&D for the Environment Waste in Operational Processes Responsible Supply Chain Talent Diversity Talent Engagement and Retention NASDAQ recognition of West’s Corporate Responsibility Report featured in Times Square, New York Creating a healthier environment through our sustainability efforts

9 F l u ro Te c ® 5 - 1 0 m L c a r t r i d g e p l u n g e r Execute. Innovate. Grow. Innovations for today’s complex and sensitive molecules WST Q4/FY 2022 Earnings We s t R e a d y Pa c k ™ w i t h C o r n i n g Va l o r ® R T U V i a l s D a i k y o C Z ® 2 . 2 5 m L i n s e r t n e e d l e s y r i n g e s y s te m

10 2023 Full-Year Guidance WST Q4/FY 2022 Earnings 2023 Full-Year Guidance Consolidated Net Sales $2.935 - $2.960 billion Adjusted-Diluted EPS $7.25 to $7.40 2023 New Share Repurchase Program • Authorized for up to $1 billion of share repurchase • No specified end date to this new repurchase program

11 Capacity Investments making progress across the Globe AMERICAS EXPANSION PROGRESS EUROPE EXPANSION PROGRESS ASIA PACIFIC EXPANSION PROGRESS Kinston Williamsport & Jersey Shore Waterford Kovin Eschweiler Jurong, Singapore 11WST Q4/FY 2022 Earnings

12 Fourth-Quarter 2022 Summary Results ($ millions, except earnings-per-share (EPS) data) Three Months Ended December 31 2022 2021 Reported Net Sales $708.7 $730.8 Gross Profit Margin 37.0% 41.1% Reported Operating Profit $129.7 $184.0 Adjusted Operating Profit (1) $158.7 $189.2 Reported Operating Profit Margin 18.3% 25.2% Adjusted Operating Profit Margin (1) 22.4% 25.9% Reported-Diluted EPS $1.36 $1.93 Adjusted-Diluted EPS (1) $1.77 $2.04 “Adjusted Operating Profit,” “Adjusted Operating Profit Margin” and “Adjusted-Diluted EPS” are Non-U.S. GAAP financial measures. See accompanying slides and the discussion under the heading “Non-U.S. GAAP Financial Measures” in today’s press release for an explanation and reconciliation of these items. (1) WST Q4/FY 2022 Earnings

13 Overall Organic Net Sales Growth – 2.6% (Q4 2022) Proprietary Products Q4 2022 organic net sales growth of 1.8% with sales of high-value products flat year over year BIOLOGICS GENERICS PHARMA Sales decline due to reduction in sales related to COVID-19 vaccines Sales led by high-value products, including Envision® components and Admin Systems Sales led by high-value products, including NovaPure®and Westar® components CONTRACT MANUFACTURING Organic sales growth of 7%, led by increase in sales of medical device products (Mid-Single Digit) Double-Digit Mid-Single DigitHigh-Single Digit Fourth-Quarter 2022 Organic Net Sales Growth WST Q4/FY 2022 Earnings

14 Change in Consolidated Net Sales Fourth-quarter 2021 to 2022 ($ millions) WST Q4/FY 2022 Earnings

15 Gross Profit Update ($ millions) Three Months Ended December 31, 2022 2021 Proprietary Products Gross Profit $243.0 $282.4 Proprietary Products Gross Profit Margin 41.6% 46.3% Contract-Manufactured Products Gross Profit $19.1 $20.1 Contract-Manufactured Products Gross Profit Margin 15.4% 16.5% Consolidated Gross Profit $262.1 $300.6 Consolidated Gross Profit Margin 37.0% 41.1% WST Q4/FY 2022 Earnings

16 Cash Flow and Balance Sheet Metrics ($ millions) Cash Flow Items YTD Q4 2022 YTD Q4 2021 Depreciation and Amortization $120.6 $122.3 Operating Cash Flow $724.0 $584.0 Capital Expenditures $284.6 $253.4 Free Cash Flow $439.4 $330.6 Financial Condition December 31, 2022 December 31, 2021 Cash and Cash Equivalents $894.3 $762.6 Debt $208.9 $253.0 Equity $2,684.9 $2,335.4 Working Capital $1,400.5 $1,147.9 WST Q4/FY 2022 Earnings

17 Execute. Innovate. Grow. Delivering Unique Value to Customers and Patients Global Operational Effectiveness Across the Network Accelerating Investments for the Future Committed to patient health today and into the future WST Q4/FY 2022 Earnings

18 Eric M. Green President and Chief Executive Officer, Chair of the Board Bernard J. Birkett Senior VP and Chief Financial and Operations Officer Quintin Lai VP, Corporate Strategy & Investor Relations Q & A

19 Notes to Non-U.S. GAAP Financial Measures The Non-U.S. GAAP financial measures are incorporated into our discussion and analysis as management uses them in evaluating our results of operations and believes that this information provides users a valuable insight into our overall performance and financial position. A reconciliation of these adjusted Non-U.S. GAAP financial measures to the comparable U.S. GAAP financial measures is included in the accompanying tables. For the purpose of aiding the comparison of our year-over-year results, we may refer to net sales and other financial results excluding the effects of changes in foreign currency exchange rates. Organic net sales exclude the impact from acquisitions and/or divestitures and translate the current-period reported sales of subsidiaries whose functional currency is other than the U.S. Dollar at the applicable foreign exchange rates in effect during the comparable prior-year period. We may also refer to financial results excluding the effects of unallocated items. The re-measured results excluding effects from currency translation, the impact from acquisitions and/or divestitures, and the effects of unallocated items are not in conformity with U.S. GAAP and should not be used as a substitute for the comparable U.S. GAAP financial measures. WST Q4/FY 2022 Earnings

20 Notes to Non-U.S. GAAP Financial Measures RECONCILIATION OF NON-U.S. GAAP FINANCIAL MEASURES (UNAUDITED) See “Notes to Non-U.S. GAAP Financial Measures”, “Safe Harbor Statement” (Slide 4) and today’s press release for an explanation and reconciliation of these items. Reconciliation of Reported and Adjusted Operating Profit, Net Income and Diluted EPS ($ millions, except EPS data) Three months ended December 31, 2022 Operating profit Income tax expense Net income Diluted EPS Reported (U.S. GAAP) $129.7 $28.9 $103.0 $1.36 Restructuring and related charges 25.4 2.4 23.0 0.30 Pension settlement - 0.3 0.9 0.02 Amortization of acquisition-related intangible assets 0.1 - 0.7 0.01 Cost investment activity 3.5 - 3.5 0.05 Tax law changes - (2.5) 2.5 0.03 Adjusted (Non-U.S. GAAP) $158.7 $29.1 $133.6 $1.77 WST Q4/FY 2022 Earnings Twelve months ended December 31, 2022 Operating profit Income tax expense Net income Diluted EPS Reported (U.S. GAAP) $734.0 $114.7 $585.9 $7.73 Restructuring and related charges 23.8 2.0 21.8 0.29 Pension settlement - 20.6 31.6 0.42 Amortization of acquisition-related intangible assets 0.7 0.1 2.8 0.04 Cost investment activity 3.5 - 3.5 0.05 Royalty acceleration - 1.3 (1.3) (0.02) Tax law changes - (5.7) 5.7 0.07 Adjusted (Non-U.S. GAAP) $762.0 $133.0 $650.0 $8.58

21 Notes to Non-U.S. GAAP Financial Measures RECONCILIATION OF NON-U.S. GAAP FINANCIAL MEASURES (UNAUDITED) See “Notes to Non-U.S. GAAP Financial Measures”, “Safe Harbor Statement” (Slide 4) and today’s press release for an explanation and reconciliation of these items. Reconciliation of Reported and Adjusted Operating Profit, Net Income and Diluted EPS ($ millions, except EPS data) Three months ended December 31, 2021 Operating profit Income tax expense Net income Diluted EPS Reported (U.S. GAAP) $184.0 $34.2 $147.7 $1.93 Pension settlement - 0.3 0.8 0.01 Cost investment activity 2.5 - 2.5 0.03 Restructuring and related charges (0.3) (0.1) (0.2) - Amortization of acquisition-related intangible assets 0.2 - 0.7 0.01 Asset impairment 2.8 - 2.8 0.04 Royalty acceleration - (2.0) 2.0 0.02 Adjusted (Non-U.S. GAAP) $189.2 $32.4 $156.3 $2.04 WST Q4/FY 2022 Earnings Twelve months ended December 31, 2021 Operating profit Income tax expense Net income Diluted EPS Reported (U.S. GAAP) $752.3 $107.2 $661.8 $8.67 Pension settlement - 0.5 1.5 0.02 Cost investment activity 4.3 (0.1) 4.4 0.06 Restructuring and related charges 2.2 0.4 1.8 0.02 Amortization of acquisition-related intangible assets 0.8 0.1 2.8 0.04 Asset impairment 2.8 - 2.8 0.04 Royalty acceleration - 18.5 (18.5) (0.25) Tax law changes - 1.4 (1.4) (0.02) Adjusted (Non-U.S. GAAP) $762.4 $128.0 $655.2 $8.58

22 Notes to Non-U.S. GAAP Financial Measures RECONCILIATION OF NON-U.S. GAAP FINANCIAL MEASURES (UNAUDITED) See “Notes to Non-U.S. GAAP Financial Measures”, “Safe Harbor Statement” (Slide 4) and today’s press release for an explanation and reconciliation of these items. Reconciliation of Net Sales to Organic Net Sales (1) ($ millions) Organic net sales exclude the impact from acquisitions and/or divestitures and translate the current-period reported sales of subsidiaries whose functional currency is other than the U.S. Dollar at the applicable foreign exchange rates in effect during the comparable prior-year period. (1) Three months ended December 31, 2022 Proprietary CM Eliminations Total Reported net sales (U.S. GAAP) $584.8 $123.9 $- $708.7 Effect of changes in currency translation rates 35.3 6.0 - 41.3 Organic net sales (Non-U.S. GAAP) (1) $620.1 $129.9 $- $750.0 WST Q4/FY 2022 Earnings Twelve months ended December 31, 2022 Proprietary CM Eliminations Total Reported net sales (U.S. GAAP) $2,406.8 $480.4 $(0.3) $2,886.9 Effect of changes in currency translation rates 138.6 24.0 - 162.6 Organic net sales (Non-U.S. GAAP) (1) $2,545.4 $504.4 $(0.3) $3,049.5

23 Notes to Non-U.S. GAAP Financial Measures RECONCILIATION OF NON-U.S. GAAP FINANCIAL MEASURES (UNAUDITED) See “Notes to Non-U.S. GAAP Financial Measures”, “Safe Harbor Statement” (Slide 4) and today’s press release for an explanation and reconciliation of these items. Reconciliation of Reported-Diluted EPS Guidance to Adjusted-Diluted EPS Guidance 2022 Actual 2023 Guidance % Change Reported-diluted EPS (U.S. GAAP) $7.73 $7.21 to $7.36 (6.7%) to (4.8%) Restructuring and related charges 0.29 - Pension settlement 0.42 - Amortization of acquisition-related intangible assets 0.04 0.04 Cost investment activity 0.05 - Royalty acceleration (0.02) - Tax law changes 0.07 - Adjusted-diluted EPS (Non-U.S. GAAP) (1) $8.58 $7.25 to $7.40 (15.5%) to (13.8%) (1) See “Full-year 2023 Financial Guidance” and “Non-U.S. GAAP Financial Measures” in today’s press release for additional information regarding adjusted-diluted EPS. We have opted not to forecast 2023 tax benefits from stock-based compensation in upcoming quarters, as they are out of the Company’s control. Instead, we recognize the benefits as they occur. In 2022, tax benefits associated with stock-based compensation increased adjusted-diluted EPS by $0.22. Any future tax benefits associated with stock- based compensation that we receive in 2023 would provide a positive adjustment to our full-year EPS guidance. WST Q4/FY 2022 Earnings

XML

Cover	Feb. 15, 2023
Cover [Abstract]
Document Type	8-K
Document Period End Date	Feb. 15, 2023
Entity Registrant Name	WEST PHARMACEUTICAL SERVICES, INC.
Entity Incorporation, State or Country Code	PA
Entity File Number	1-8036
Entity Tax Identification Number	23-1210010
Entity Address, Address Line One	530 Herman O. West Drive
Entity Address, City or Town	Exton
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	19341-0645
City Area Code	610
Local Phone Number	594-2900
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.25 per share
Trading Symbol	WST
Security Exchange Name	NYSE
Entity Emerging Growth Company	false
Amendment Flag	false
Entity Central Index Key	0000105770