18th Jan 2007 07:01
Hikma Pharmaceuticals Plc18 January 2007 Pre-close trading statement LONDON, 18 January 2007 - Hikma Pharmaceuticals PLC ("Hikma") (LSE: HIK) (DIFX:HIK), the multinational pharmaceuticals group, will enter its close period on 21January 2007 ahead of the preliminary announcement of its results for the twelvemonths ended 31 December 2006, which will be made on 22 March 2007. Hikma performed very well in 2006 and the Board currently expects a strong setof results for the 2006 full-year, with revenue growth of around 20%, grossmargin close to 50% and growth in profits attributable to shareholders slightlybelow 25%.* In 2006 the Branded business continued to perform extremely well, withanticipated revenue growth of approximately 40% compared to 2005. This wasachieved through organic growth in our established markets, such as SaudiArabia, Sudan and Jordan, as well as by growth in newer markets like Lebanon andthe United Arab Emirates. The consolidation of approximately $12 million insales from JPI, wholly-owned as of September 2006, also contributed to thisstrong performance. Gross margin in the Branded business will reflect the impactof reference pricing in Algeria and increased overheads related to the newAlgerian manufacturing plant, opened in early 2006. It is expected that our Injectable business will deliver strong growth of morethan 35% for the year, with growth coming from all three operating regions. Wesaw considerable momentum in the MENA region and in Europe, where sales grew asa result of our continued focus on sales and marketing. Sales in the US werehigher than last year and we are still awaiting the approval of an importanthigh margin product. Taking into consideration our strong product pipeline, weincreased investment in sales and marketing across all regions, particularly inthe second half of the year, but still expect to deliver operating marginexpansion on a year-on-year basis. As announced in our trading update in October, the performance of our Genericbusiness was impacted in 2006 by continued price erosion and a limitedcontribution from new product launches. We continue to expect that full yearGeneric sales will be slightly below those achieved in 2005 and this will bereflected in the Generic business's gross margin. Outlook Looking forward we expect to deliver sales growth in 2007 in the mid-20% range.Gross margins are expected to be slightly lower in 2007 than in 2006, as we worktowards being more competitive in the US generic market and as we beginproduction at our new Injectable plant in Portugal. We will continue to investin R&D at a rate of 5% to 6% of sales and we expect that our effective tax ratewill improve slightly from the 26% we are currently forecasting for 2006. Commenting on 2006, Samih Darwazah, Chairman and CEO said, 'Hikma has performedextremely well this year, continuing our track record for delivering stronggrowth. We are confident about the Company's prospects for 2007 and believe thatthe fundamentals of our business remain very strong. ' - ENDS - Enquiries: Hikma Pharmaceuticals PLC Susan Ringdal +44 20 7399 2760Investor Relations Director Brunswick Group Jon Coles / Justine McIlroy / Alex Tweed +44 20 7404 5959 About Hikma Hikma Pharmaceuticals PLC is a multinational pharmaceutical group focused ondeveloping, manufacturing and marketing a broad range of both branded andnon-branded generic and in-licensed pharmaceutical products. Hikma's operationsare conducted through three businesses: Generic, Branded and InjectablePharmaceuticals. Hikma's operations are based principally in the United States,the Middle East and North Africa ("MENA") region and Europe. In 2005, the Grouphad revenue of $262 million and profit attributable to shareholders of $44million. At 31 December 2005, the Group had over 1,800 employees. For news andother information, please visit www.hikma.com.-------------------------- * These figures have not yet been reviewed by Hikma's auditors This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Hikma Pharmaceuticals