27th Jun 2007 07:01
Hikma Pharmaceuticals Plc27 June 2007 Pre-close trading statement Hikma expects first half revenue growth of approximately 40% LONDON, 27 June 2007 - Hikma Pharmaceuticals PLC ("Hikma") (LSE: HIK) (DIFX:HIK), the multinational pharmaceuticals group, has seen continuing growth in theyear to date and expects first half revenues to be up approximately 40% andfirst half gross margins to be around 50%. The Branded business, which operates in the Middle East and North Africa (MENA),has been performing particularly well and is expected to deliver growth ofapproximately 60% for the first half, compared to the same period in 2006. Thishas been driven by organic growth of approximately 30% and the fullconsolidation of JPI, the Saudi-based business that became a wholly ownedsubsidiary in the second half of 2006. JPI's integration has now beensuccessfully completed and it is growing in line with our expectations. TheBranded business's performance in the first half also reflects the continuingseasonality of this business, which is traditionally strongest in the first sixmonths of the year. Underlying growth in the Injectable business should exceed 20% for the firsthalf, driven by a very strong performance in the MENA region. Including ourrecently acquired oncology businesses, Ribosepharm and Thymoorgan, growth in theInjectable business as a whole is expected to be around 57% for the first halfof the year. The sales and marketing team at Ribosepharm is maintaining itsstrong position in the German injectable oncology market and we are successfullyexpanding the product portfolio. At Thymoorgan, the injectable oncologymanufacturer we acquired in June, we expect to launch our first product for thePortuguese market this summer and have already begun the certification of theplant for the MENA region. In Portugal, our new cephalosporin plant has recently been approved forproduction for Europe and the MENA region and we continue to expect to beginproduction for the US market in the second half of the year. As a result oflimited production at the new plant in the year to date, the Injectable businesswill see lower operating margins in the first half of the year, compared to thesame period in 2006. As we increase utilisation in the second half, we expectmargins will improve. However, the consolidation of Ribosepharm, with its highersales and marketing costs, will lead to a slightly lower Injectables operatingmargin for the full year, compared to 2006. The generic market in the US continues to be competitive, both in volume andpricing terms. We expect first half sales in the Generic business to be slightlyabove the first half of 2006, driven by higher volumes and the contribution fromnew product launches. As expected this growth has been achieved through morecompetitive pricing. Outlook Looking forward, we are confident that we will deliver sales growth in 2007 inexcess of 35%. Gross margin is still expected to be in line with 2006, at around50%. At the group level, we expect general and administrative expenses to growin line with sales, due to the consolidation of acquisitions and the costsassociated with supporting the growth of the Group. Following the acquisitionsof Ribosepharm and Thymoorgan, and including budgeted capital expenditure, weexpect to be in a net debt position of around $85 million at the end of June. Commenting on the first half, Samih Darwazah, Chairman and CEO said, 'Hikma hasperformed well in the year to date. We continue to show growth in our keybusinesses and I am confident that, on the back of very solid fundamentals, weare well-placed to deliver another year of strong growth, in line with ourexpectations.' Hikma will enter its close period on 7 July 2007 ahead of the announcement ofits results for the six months ended 30 June 2007, which will be made on 5September 2007. - ENDS -Enquiries: Hikma Pharmaceuticals PLC Susan Ringdal +44 20 7399 2760Investor Relations Director Brunswick GroupJon Coles / Justine McIlroy / Alex Tweed +44 20 7404 5959 About Hikma Hikma Pharmaceuticals PLC is a fast growing multinational group focused ondeveloping, manufacturing and marketing a broad range of both branded andnon-branded generic and in-licensed products. Hikma's operates through threebusinesses: "Branded", "Injectables" and "Generics", based principally in theMiddle East and North Africa ("MENA"), where it is a market leader and sellsacross 18 countries, the United States and Europe. In 2006, Hikma achievedrevenues of $317 million (2005 $262 million) and profit attributable toshareholders was $55 million (2005 $44 million). At 31 December 2006, the Grouphad over 2,400 employees. For news and other information, please visitwww.hikma.com. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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