Richter Q3 Earnings Double
Image by LaMography/Moni Lazar
Third-quarter net income of listed Hungarian pharmaceutical company Gedeon Richter jumped 116% year-on-year to HUF 82.4 billion as revenue rose and margins widened, supported by favorable exchange rates, state news wire MTI writes, citing an earnings report released ahead of the opening bell on Tuesday.
Richter CEO Gábor Orbán acknowledged that the rare combination of the simultaneous strength of the dollar and the ruble gave "a massive uplift to the already robust underlying trend" in both sales revenue and overall profitability.
The United States and Russia are Richter's top two markets.
Revenue climbed 38% to HUF 217.8 bln, rising faster than the direct cost of sales which increased 21% to HUF 87.1 bln.
Sales and marketing costs rose 33% to HUF 36 bln and R&D spending was up 14% at HUF 18.8 bln.
Earnings per share came to HUF 442 for the period.
Financial Gains Support Q1-Q3 Profit
For the period Q1-Q3, Richter's net income rose 111% to HUF 196 bln.
Revenue increased 27% to HUF 578.8 bln. Direct costs of sales climbed 20% to HUF 242.1 bln. Sales and marketing costs were up 24% at HUF 103.4 bln and spending on R&D rose 16% to HUF 55.8 bln.
The bottom line was lifted by net financial income of HUF 51.3 bln, well over the HUF 1.8 bln in the base period.
Orbán pointed to the "extra boost" financial income got as both USD and RUB exchange rates to the HUF peaked near the end of the reporting period.
Vraylar Boosts U.S. Revenue
The United States was Richter's biggest market in Q1-Q3: sales there rose 36% to HUF 117.5 bln. Royalty revenue there linked to Vraylar, the brand name for Richter's antipsychotic cariprazine, increased 38pc to HUF 98.5 bln.
Sales in Russia, Richter's second-biggest market, increased 47% to HUF 89.9 bln. Richter noted that the ruble appreciated against the forint by an average 36% in Q1-Q3.
"Notwithstanding a volatile market environment presenting unforeseeable risks connected to the ongoing war and the subsequent sanctions imposed on Russia, business operations prevailed at levels experienced prior to the pandemic," Richter said.
Domestic sales rose 7% to HUF 33.5 bln. Richter's market share in Hungary was 4.5%, making it the fourth-biggest player. However, it was runner-up on the market for prescription drugs alone, with 7.4% market share.
Cariprazine, also marketed under the brand Reagila, was Richter's biggest-selling product in Q1-Q3, generating turnover of HUF 104.3 bln, ahead of oral contraceptives, sales of which came to HUF 98.7 bln.
Richter's balance sheet shows retained earnings of HUF 1.008 trillion at the end of September.
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