Higher Sales, Financial Gain Lift Richter Earnings


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Second-quarter net income of Hungarian pharmaceutical company Gedeon Richter climbed 173% year-on-year to HUF 76.5 billion, lifted by higher sales, improved margins, and a net financial gain, state news wire reports citing an earnings report released ahead of the opening bell on Wednesday.

Revenue increased 24% to HUF 192.9 bln, outpacing the rise in the cost of sales, which was up 23% at HUF 82.9 bln.

Gross profit rose 25% to HUF 110 bln, while operating profit increased 43% to HUF 52 bln as spending on sales and marketing and R&D rose a little over 25%.

Richter booked net financial income of HUF 28.7 bln for the quarter, compared to a HUF 6.2 bln loss in the base period.

Earnings per share came to HUF 411 for the quarter.

H1 Earnings Double

First-half net income increased 107% from the same period a year earlier to HUF 113.6 bln as sales climbed 22% to HUF 361 bln, rising faster than the direct cost of sales.

Operating profit rose 47% to HUF 89.5 bln.

A net financial gain of HUF 30 bln - compared to a loss of HUF 4.8 bln in the base period - improved earnings. Just HUF 9.8 bln of the financial gain was realized, the report shows.

The first-half EPS came to HUF 610.

The United States was Richter's biggest market in H1: sales there rose 31% to HUF 70.7 bln. U.S. sales of Vraylar, the brand name for Richter's antipsychotic cariprazine, came to HUF 57.3 bln, while sales of the morning-after pill Plan B "increased substantially", Richter said.

Sales in Russia, Richter's second-biggest market, increased 26% to HUF 50.8 bln. 

"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 8% to HUF 22.8 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 a 7.4% market share.

Cariprazine, also marketed under the brand Reagila, was Richter's biggest-selling product in H1, generating a turnover of HUF 61.1 bln, ahead of oral contraceptives, sales of which came to HUF 60.8 bln.

Richter's balance sheet shows retained earnings of HUF 924.6 bln at the end of June.


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