Hikma Pharmaceuticals announced that it remains on course to meet its full-year expectations despite a decrease in operating profits during the first half of the year. The company reported a 6% increase in group revenue to $1.66 billion for the six months ending on June 30. This growth was primarily driven by strong demand across its product portfolio, particularly in the injectables segment, which saw double-digit growth in Europe.
However, Hikma experienced a 26% decline in operating profits, amounting to $259 million, due to factors such as a legal settlement and changes in product mix. Core operating profits also decreased by 7% to $373 million, while core underlying earnings slipped by 5% to $429 million. Margins were under pressure across various segments, with injectables recording a 30.0% core operating margin and Hikma Rx dropping to 17.6%. On the other hand, branded medicines showed resilience with a 30.4% margin and a 3% increase in core operating profit.
Despite a 19% decrease in cash flow from operations to $161 million, profit attributable to shareholders rose by 5% to $238 million. Basic earnings per share also saw a 6% increase to USD 108 cents, accompanied by a 12% rise in interim dividends to USD 36 cents. CEO Riad Mishlawi expressed optimism, stating that the strategic changes implemented in the first half of the year have started yielding positive outcomes. He anticipates a return to growth in the second half and reiterated the company’s full-year guidance for 2025.
Following these announcements, Hikma’s shares experienced a 6.95% decline to 1,753p as of 0850 BST. The company remains focused on delivering results and building momentum across its operations to ensure sustained growth and profitability in the upcoming periods.
Key Takeaways:
– Hikma Pharmaceuticals is confident in meeting its full-year expectations despite a drop in first-half operating profits.
– Revenue growth was driven by strong demand for injectables, especially in Europe, offsetting margin pressures.
– The company reported declines in core operating profits and core underlying earnings, primarily influenced by a legal settlement and changes in product mix.
– Hikma’s CEO is optimistic about the strategic changes made and foresees a return to growth in the second half of the year.
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