Hungarian pharmaceuticals company Richter Gedeon had consolidated net income of HUF 26.5 billion billion in the second quarter of 2010, up 225% from a year earlier, the company's unaudited consolidated IFRS report shows.
Operating profit rose double-digit, lifted by a milestone payment from Forest Laboratories in the quarter, but the main boost came from large financial profit instead of a similar-size loss as the forint weakened by the end the quarter.
Q1 net income was sharply higher than the HUF 19.6 billion consensus by analysts polled by the website portfolio.hu.
Q2 sales rose just 0.8% to HUF 73.8 billion in Q2 and cost of sales fell 7.7% to HUF 28.7 billion, resulting in 7.1% higher gross profit, of HUF 45.1 billion. First-half sales rose 2.0% to HUF 137.22 billion -- a 9.1% euro-term rise to €504.5m as the forint on average was 6.5% stronger to the euro than in H1 2009.
First-half net income rose 36.8% to HUF 38.0 billion as profit from operations rose just 3.2% to HUF 28.2 billion while net financial income jumped to HUF 9.9 billion from HUF 2.2 billion in the first half of 2009, with more than half in realized gains.
In Q2 alone, Richter registered net financial income of HUF 9 billion as against net financial loss of HUF 7.5 billion a year earlier. Q2 profits from operations, boosted by the milestone payment in the period, rose 18.7% to HUF 17.7 billion.
Within costs, sales and marketing expenses rose 6% to HUF 28.5 billion. Administrative and general expenses fell 1.7% to HUF 9.2 billion as a moderate increase in Hungary was more than offset by a forint-term decrease at foreign units.
Research and Development expenses represented 12.5% of sales and increased by 26.0% to HUF 17 billion in H1. The increase resulted from ongoing clinical trials being carried out in co-operation with Forest Laboratories.
Other income and expenses -- where the milestone payments booked, among others -- brought in net HUF 2.3 billion in the first half of this year instead of just HUF 351 million in H1 2009. The effect was even more in Q2 when that item brought in net HUF 3 billion instead of net expenses of HUF 1.2 billion a year earlier.
Richter sales in Hungary rose 9.1% in forint terms to HUF 17.32 billion in H1 as price reductions were insignificant and turnover from products launched in the past two years rose.
Foreign sales rose 8.1% in euro terms to €440.8 million in January-June 2010, including euro-term rises of 1.9% to €9.17 billion in the EU9 countries but an 8.5% decrease in the EU15 to €8.24 billion. Sales to the CIS countries rose a sharp 20.1% to €182.6 million. US sales fell 4% in euro terms to €52.2 million in the first half but improved in the second quarter primarily as a result of increasing generic drospirenone sales. Sales with the “rest of the world” region rose 11.7%.
Diluted earning per share (EPS) totaled HUF 2,041 (€7.50) in H1, up from HUF 1,492 (€5.13) a year earlier. In the second quarter diluted EPS jumped to HUF 1,422 (€5.19) from HUF 335 (€1.23) .
Total assets of the group stood at HUF 466.64 billion on June 30, 2010, up 8.5% from six months earlier, including a 8.0% rise in capital and reserves, to HUF 409.09 billion. (MTI – Econews)