Richter racks up Q4 loss on weaker ruble


Hungarian drugmaker Gedeon Richter finished the fourth quarter of last year HUF 4.2 bln in the red as the sharp weakening of the ruble generated a big financial loss, an earnings report published today shows.

Richter had a financial loss of HUF 15.5 bln in Q4, the consolidated IFRS report shows, well over the HUF 2.9 bln loss in the base period. The company noted that it had reassessed its Russian receivables and ruble-denominated cash and cash equivalents at the end of the period following the "exceptional devaluation" of the currency late in the year.

The unrealised loss is perhaps the only blemish on Richter's P+L statement for the period. Revenue was down about 1% at HUF 90.1 bln. But direct cost of sales fell 4.4% to HUF 34.7 bln, lifting gross profit by 1.4% to HUF 55.4 bln. Other costs, notably for sales and marketing, fell, too, causing operating profit to more than triple to HUF 12.6 bln.

Richter's earnings per share came to negative HUF 23 for the period.

Richter booked net income of HUF 24.6 bln for the full year, down 42.4% as a HUF 12.7 bln financial loss weighed. Revenue was practically flat at HUF 353.7 bln, while direct cost of sales climbed 5.5% to HUF 139.4 bln. Gross profit was down 2.5% at HUF 214.3 bln and operating profit slipped 15.7% to HUF 39.2 bln.

In a breakdown of revenue by region, Richter said its sales in Russia fell 15.3% to HUF 84.5 bln last year, while sales in Ukraine were down 20% at HUF 17.1 bln. Sales in Hungary climbed 5% to HUF 32.8 bln and sales in the rest of the European Union rose 5.6% to HUF 134.7 bln. Sales in the United States increased a little more than 14% to HUF 16.1 bln and Chinese sales rose almost 40% to HUF 13.6 bln. Sales in Latin America were up more than 43% at HUF 8.3 bln.

Richter's balance sheet shows total assets of HUF 718.3 bln at the end of last year, up 0.6% from the end of 2013. Net assets rose 1.8% to HUF 561.2 bln during the period.

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