A raft of acquisitions and a buoyant injectables division have pushed up first-half revenues at Hikma Pharmaceuticals, offsetting a shrinking of sales at the Jordan-based drugmaker’s generics unit.
The FTSE 250 company on Thursday reported a 35 per cent increase in interim revenues to $532.3m, aided by acquisitions including last year’s $111m purchase of a controlling stake in Morocco’s Promopharm.
On an organic basis, interim revenues rose 7.6 per cent year-on-year, which marked a slowdown compared with 9.6 per cent growth recorded in the final half of 2011.
The deceleration was partially caused by troubles at its generic drug division, which reported a 27 per cent year-on-year fall in first-half revenues to $55.8m.
The generic drug and injectables specialist attributed the decline to a slackening in production at its New Jersey manufacturing facility, and further cut its full-year revenue guidance for the division from $125m to $115m – down on the $155m reported in 2011.
The news pushed up shares in Hikma 5.6 per cent to 765.5p in early London trading.
Hikma’s generics unit came under pressure in February following the receipt of a warning letter from the US Food and Drug Administration regarding the group’s Eatontown oral dosage facility.
Moves to comply with the regulator’s requests have slowed production at the facility, impacting sales of its generic drugs.
Hikma, which earns more than half of its revenues from the Middle East and north Africa regions (MENA), appears to have recovered from turbulence stemming from last year’s Arab Spring protests, which prompted the group to almost halve its sales growth forecasts for 2011
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The group’s sales in the region proved more resilient than initially feared, and Hikma was one of the first companies to restart its operations in Libya following the toppling of Muammer Gaddafi’s regime.
“I am pleased with the growth we have achieved in our key MENA markets this year. Our global injectables business continues to deliver strong growth, as we benefit from our increased scale,” said Said Darwazah, Hikma chief executive.
Pre-tax profit rose from $39.9m to $57.8m, and diluted earnings per share increased from 16.7 cents to 20.4 cents. An interim dividend of 6 cents was proposed, up from 5.5 cents last time.
The positive figures encouraged Mr Darwazah, a senator and former minister in Jordan, to reiterate its guidance for revenue growth of about 20 per cent for the full year.