BUDAPEST: A large financial gain lifted Hungarian drugmaker Gedeon Richter’s fourth-quarter net income to HUF 19.3 billion, a little more than double the HUF 9.5 bln it brought in during the same period in 2015, an earnings report published early this morning shows.
Net income was a little more than the HUF 16.7 bln estimate by analysts polled by Portfolio.hu. Earnings per share came to HUF 103.
Richter booked a HUF 5.9 bln financial gain for the quarter, improving over a HUF 3.3 bln loss in the base period. Revenue rose 19% to HUF 105.7 bln. Cost of sales outpaced the increase, climbing 27% to HUF 48.3 bln, and gross profit rose just over 13% to HUF 57.4 bln. Higher R&D costs caused operating profit to drop 26% to HUF 10.6 bln.
A large financial gain also lifted Richter’s profits for the full year. The company booked net income of HUF 63.3 bln, up 18%. Financial profit came to HUF 8.7 bln, compared to a HUF 8.3 bln loss in the base period.
Richter noted that the big loss in 2015 was due to the weaker ruble and Kazakh tenge, while exchange rate gains on trade receivables in Russia, Richter’s biggest export market, were supported by a 23% strengthening of the ruble against the forint. Revenue rose 7% to HUF 389.7 bln. Gross profit rose a little more than 2% to HUF 225.4 bln as costs of sales climbed 13% to HUF 164.3 bln.
Richter said its gross margin was impacted by the amortization of two drugs in its portfolio, lower sales in CIS countries other than Russia, and a higher share of narrower-margin wholesale and retail sales in Romania.
In a breakdown of revenue by region, Richter said domestic sales rose 2% to HUF 35.8 bln, while sales in other European Union countries climbed 11% to HUF 166.2 bln. Sales in Russia were practically flat at HUF 80.2 bln. R&D spending edged up about 1% to HUF 35.1 bln for the year. CAPEX rose 8% to HUF 36.1 bln.
Richter had total assets of HUF 810.1 bln at the end of last year, up 8% from the end of 2015. Net assets rose 10% to HUF 679.6 bln. Non-current liabilities fell 23% to HUF 43.8 bln.
