Egis stands by guidance for revenue growth of 4-6%

Hungarian drugmaker Egis is standing by its projection for revenue growth of 4-6% in the business year started October 1, CFO Csaba Poroszlai said at a press conference on Wednesday, after the company published its Q2 earnings report. The decline in domestic sales is expected to slow, Poroszlai said. He put the drop for the full business year at 5-10%, a little under the 12% decrease in the first half. Egis' revenue will be boosted mainly by sales in Russia and the CIS, set to rise 8-12%. Egis' Q2 revenue climbed 2.4% to HUF 34.3 billion from the same period a year earlier, the earnings report shows. Domestic sales were down 2.1%, but export sales climbed 3.7%. Cost of sales rose just 1.1% to HUF 14.0 billion, showing a widening margin and lifting Egis' gross profit by 3.4% to HUF 20.3 billion. But administration and distribution costs rose 14.8% to HUF 14.3 billion - including HUF 3.3 billion spent on reseach and development - causing operating profit to fall by 15.5% to HUF 5.8 billion. More than HUF 2 billion in financial profit lifted the bottom line to give Egis after-tax profit of HUF 7.6 billion, up 17.4% from the same period a year earlier. CAPEX came to HUF 4.2 billion for the first half of 2012/2013 business year, Poroszlai said. Egis continues to review the possibility of acquisitions, mainly in the region, and within the region first of all in Russia, he said. The primary goal would be to acquire production capacity, but Egis could also expand its product portfolio with acquisitions, he added.