TIDMHIK
RNS Number : 0795Y
Hikma Pharmaceuticals Plc
27 August 2009
Hikma Pharmaceuticals PLC
Interim results announcement
for the six months to 30 June 2009
London, 27 August 2009 - Hikma Pharmaceuticals PLC ("Hikma") (LSE: HIK) (NASDAQ
DUBAI: HIK), the fast growing multinational pharmaceutical group, today reports
its interim results for the six months ended 30 June 2009.
+----------------------------------+---------+------------+---------------+
| Summary P&L | | | |
+----------------------------------+---------+------------+---------------+
| | H1 2009 | H1 2008 | Change |
+----------------------------------+---------+------------+---------------+
| | $m | $m | |
+----------------------------------+---------+------------+---------------+
| Revenue | 321.5 | 299.9 | +7.2% |
| | | | |
+----------------------------------+---------+------------+---------------+
| Gross profit | 151.2 | 135.0 | +12.0% |
| | | | |
+----------------------------------+---------+------------+---------------+
| Operating profit | 57.2 | 47.1 | +21.5% |
| | | | |
+----------------------------------+---------+------------+---------------+
| Profit attributable to | 43.2 | 32.9 | +31.4% |
| shareholders | | | |
| | | | |
+----------------------------------+---------+------------+---------------+
| Diluted earnings per share | 22.3 | 17.0 | +31.2% |
| (cents) | | | |
| | | | |
+----------------------------------+---------+------------+---------------+
| Dividend per share (cents) | 4.5 | 3.5 | +28.6% |
+----------------------------------+---------+------------+---------------+
Highlights
* Group revenues up 7.2% to $321.5 million
* Gross margin improved to 47.0%, compared to 45.0% in H1 2008
* Operating profit up 21.5% to $57.2 million reflecting strong improvement in
Generics profitability
* Diluted earnings per share up 31.2% to 22.3 cents
* Dividend per share up 28.6% to 4.5 cents
* Operating cash flow increased by $30.8 million to $36.2 million reflecting
working capital improvements
* Net debt decreased by $33.2 million to $164.4 million since June 2008
* Launched 72 products across the Group, including 12 new compounds1 and 25 new
dosage forms and strengths
1 New pharmaceutical compounds that are being launched for the first time by
the Group or for the first time within another business segment.
Said Darwazah, Chief Executive Officer of Hikma, said:
"Despite difficult economic conditions and a slowing global healthcare market,
Hikma has achieved an excellent set of half year results, with 31.2% growth in
diluted earnings per share. We have also increased our dividend by 28.6% to 4.5
cents. Our Branded business continues to outperform the market and we have been
able to gain market share in key markets. We are very satisfied with the
turnaround of our US Generics business, which reflects the direct action we have
taken to improve the quality of this business. We remain confident that the
performance of our Injectables business will improve in the second half of the
year, particularly in the MENA region and the US, and continue to be positive on
the long-term prospects for this business.
We remain confident in the outlook for the full year and we believe that we have
the right strategy to continue our track record of growth."
Enquiries
Hikma Pharmaceuticals PLC
Susan Ringdal, Investor Relations Director Tel: +44 (0)20 7399 2760
Brunswick Group
Jon Coles / Justine McIlroy Tel: +44 (0)20 7404 5959
About Hikma
Hikma Pharmaceuticals PLC is a fast growing multinational group focused on
developing, manufacturing and marketing a broad range of both branded and
non-branded generic and in-licensed products. Hikma's operations are conducted
through three businesses: "Branded", "Injectables" and "Generics" based
principally in the Middle East and North Africa ("MENA") region, where it is a
market leader, the United States and Europe. In 2008, Hikma achieved revenues of
$581 million and profit attributable to shareholders of $57 million. For news
and other information, please visit www.hikma.com.
Interim management report
Group performance
Revenue for the Group increased by 7.2% to $321.5 million, compared to $299.9
million in the first half of 2008. On a constant currency basis, Group revenues
increased by 11.0%. During the period our Branded business continued to perform
well and we saw a considerable improvement in our US Generics business compared
to the first half of 2008. These strong performances were partially offset by a
decline in Injectables revenues compared to the first half of 2008, reflecting
the impact of negative foreign exchange movements and our strategic decision to
reduce private label sales in the US.
Exchange rate movements had a negative impact on Group revenue of approximately
$11.5 million, or 3.6%, and on Group operating profit of approximately $3.6
million, or 6.3%. This resulted primarily from the strengthening of the US
Dollar relative to the Euro, the Algerian Dinar, the Sudanese Pound and the
Egyptian Pound.
The Branded business continues to represent close to 60% of Group sales and the
combined Branded and Injectables sales in MENA now make up 68% of total Group
sales.
+--------------------------+--------------------------+--------------------------+
| Revenue by segment | H1 2009 | H1 2008 |
+--------------------------+--------------------------+--------------------------+
| Branded | 59.2% | 58.0% |
+--------------------------+--------------------------+--------------------------+
| Injectables | 21.1% | 26.9% |
+--------------------------+--------------------------+--------------------------+
| Generics | 19.2% | 14.4% |
+--------------------------+--------------------------+--------------------------+
+--------------------------+--------------------------+--------------------------+
| Revenue by region | H1 2009 | H1 2008 |
+--------------------------+--------------------------+--------------------------+
| MENA | 68.0% | 67.1% |
+--------------------------+--------------------------+--------------------------+
| US | 20.9% | 18.6% |
+--------------------------+--------------------------+--------------------------+
| Europe and rest of world | 11.1% | 14.2% |
+--------------------------+--------------------------+--------------------------+
The Group's gross profit increased by 12.0% to $151.2 million, compared to
$135.0 million in the first half of 2008. Group gross margin for the first half
of 2009 was 47.0%, compared to 45.0% in the first half of 2008. This improvement
primarily reflects the increase in profitability in our Generics business.
Group operating expenses grew in the first half of 2009 by 6.9% to $94.0
million, compared to $87.9 million in the first half of 2008, but as a
percentage of sales remained relatively stable at 29.2%, compared to 29.3% in
the first half of 2008. The paragraphs below address the Group's main operating
expenses in turn.
Sales and marketing expenses totalled $47.3 million for the first half of the
year, compared to $47.1 million in the first half of 2008, and decreased as a
percentage of sales from 15.7% in the first half of 2008 to 14.7%. This
improvement was a result of the economies of scale gained from the full
integration of our acquisitions and increased Generics sales.
General and administrative expenses increased by 13.0% to $31.7 million,
compared to $28.0 million in the first half of 2008. This increase comes mainly
from corporate general and administrative costs, which reached $12.0 million,
compared to $8.4 million in the first half of 2008, owing primarily to increased
provisions for bad debt and increases in employee benefits. General and
administrative expenses as a percentage of sales increased to 9.9%, compared to
9.3% in the first half of 2008.
Investment in R&D decreased by 26.4% to $8.0 million, with total investment in
R&D now representing 2.5% of Group revenue, compared to 3.6% in the first half
of 2008. This decline comes as a result of our reduced investment in
bioequivalence studies for our US Generics business as we re-assessed our
priorities in the first half and our increased emphasis on targeting new
in-licensing agreements for the Group.
Other net operating expenses, which consist mainly of provisions against slow
moving inventory items and foreign exchange gains or losses, increased by $5.1
million to $7.0 million. This increase is due primarily to foreign exchange
losses of $2.1 million, which resulted mainly from the depreciation in the
Algerian and Sudanese currencies, and which compare to a $3.6 million foreign
exchange gain in the first half of 2008.
Operating profit for the Group increased by 21.5% to $57.2 million, compared to
$47.1 million in the first half of 2008. Our Group operating margin reached
17.8% compared to 15.7% in the first half of 2008.
Branded
H1 2009 highlights:
* Branded revenues up 9.3%, or 12.5% in constant currency, to $190.2 million,
outperforming the underlying MENA market
* Successful development of our cardiovascular and diabetes business and excellent
progress in the rollout of key in-licensed products
Branded revenues increased by 9.3% in the first half to $190.2 million, compared
to $174.0 million in the first half of 2008. In constant currency, Branded
revenues increased by 12.5%. Importantly, the Branded business continued to
grow faster than the underlying MENA market, where growth has slowed compared to
the first half of 2008.
Focused sales and marketing efforts helped to increase customer demand across
most Branded markets in the first half of the year. Significant focus was put on
promoting new and recently launched products, developing our market position in
key products and therapeutic areas, and building greater brand recognition.
As a result of these efforts, Hikma is the largest regional pharmaceutical
company in the MENA region and the fifth largest international pharmaceutical
company in the MENA region, with a market share of 3.8%, up from 3.5% at the end
of June 2008.2..
2 All market data sourced from IMS Health, YTD June 2009. Private retail sales
only Includes Algeria, Jordan, Kuwait, Egypt, Tunisia, Morocco, UAE, Lebanon and
Saudi Arabia.
Sales in Algeria were particularly strong in the first half, as a result of
excellent sales efforts, strong brand recognition, and our expanding product
portfolio, which now includes an impressive range of cardiovascular products
including the antihypertensives Blopress (candesartan) and Iminopril
(imidapril), the oral diabetes products Actos (pioglitazone) and Glorion
(glimepiride), and the dyslipidemia product Torvast (atorvastatin). At the end
of June, our market share in Algeria had increased to 7.0%, compared to 5.9% at
the end of June 2008. As of June 2009 we have grown to be the third largest
pharmaceutical company and the largest generic pharmaceutical manufacturer by
value in the Algerian market.
In Saudi Arabia, our specialist cardiovascular sales team is focusing on
building a leading position in the treatment of chronic heart conditions and
diabetes and is making progress in developing sales of key products like
Blopress , Actos and Glorion . We have also seen strong demand from our
hospital customers across our product portfolio. At the end of June, our market
share in Saudi Arabia had increased to 5.3%, compared to 5.0% at the end of June
2008. We are now the fourth largest pharmaceutical company by value in the
Saudi market, compared to the fifth largest at the end of June 2008.
In Jordan we have maintained our position as the market leader with a market
share of 11.9%, down from 12.5% at the end of June 2008. We delivered a strong
performance in Jordan during the period, benefitting from the efficient
integration of APM's sales and marketing staff. We also performed extremely well
in the tenders awarded in the first half, which will help to drive sales in this
market in the second half.
In Egypt, we began the rollout of some of our key Branded products, including
Actos and Tanatril (imidapril). Six further launches are planned for the
second half, including the launch of Blopress , Omnicef and Mycamine . At the
end of June, our market share in Egypt was stable at 1.4%.
Other markets that performed well during the first half were Sudan and Iraq,
where we benefited from strong demand for our own brands, and Lebanon, where we
launched some of our leading in-licensed products.
Revenue from in-licensed products grew by 24.9% in the first half of 2009 to
$73.5 million, representing 38.6% of Branded sales. Actos and Blopress have
now been launched in 13 markets, Blopress Plus has been launched in 6 markets
and Takepron has been launched in 9 markets. Our cardiovascular sales team is
working hard to establish these products as leading cardiovascular and diabetes
brands in the MENA through a combination of medical education programmes,
sponsorship of scientific conferences and targeted marketing campaigns.
We continue our efforts to develop our portfolio of in-licensed products and
have signed three new licensing agreements since the beginning of the year. In
June we signed an agreement with Teikoku Pharma USA for our own brand of
Lidoderm , the first and only US FDA approved patch for post-herpetic neuralgia.
This agreement covers the territories of Algeria, Morocco, Iraq, Libya, Sudan,
and Tunisia. In July, we signed two agreements with Faes Farma SA, a Spanish
manufacturing company - one for the manufacturing and marketing of mesalazine, a
generic product used for the treatment of inflammatory intestinal disease, and
one for the license to manufacture and market the novel anti-histamine
Bilastine . Both of these agreements cover the entire MENA region. All of these
agreements reflect our position as the partner of choice for marketing branded
products in the region.
During the first half of 2009, the Branded business launched a total of
48 products across all markets, including five new compounds and 12 new dosage
forms and strengths. The Branded business also received 22 regulatory approvals
across the region, including five for new products.
Gross profit in the Branded business increased by 7.3% to $100.9 million,
compared to $94.0 million in the first half of 2008. Reflecting the
depreciation of the Algerian Dinar, the Sudanese Pound and the Egyptian Pound,
the Branded business's gross margin declined by one percentage point to 53.0%,
compared to 54.0% in the first half of 2008,
Branded operating profit increased by 5.2% to $53.0 million, compared to $50.4
million in the first half of 2008. Operating margin in the Branded business was
27.9%, compared to 29.0% in 2008. This change is mainly due to the negative
impact of exchange rates described above.
Taking into account the seasonality of the Branded business and the first half
slowdown in the underlying MENA market, we still expect to deliver strong growth
in the Branded business for the full year.
Injectables
H1 2009 highlights:
* Injectables revenues down 16.0% to $67.7 million and down 8.6% on a constant
currency basis
* Obtained significant new injectable supply agreement in the US, effective from
July 2009
Revenue in our global Injectables business decreased by 16.0% to $67.7 million
compared $80.6 million in the first half of 2008. As 44.3% of Injectable sales
are Euro denominated, the strengthening of the US Dollar against the Euro, in
addition to the depreciation of the Algerian Dinar and the Sudanese Pound, had
an adverse impact on the segment's revenue. On a constant currency basis,
revenues decreased by 8.9%.In addition to the currency impact, the decline in
Injectables sales is due to our strategic decision to reduce private label sales
in our US business compared to the same period last year.
+--------------------------+--------------------------+--------------------------+
| Injectables revenue by | H1 2009 | H1 2008 |
| region | | |
+--------------------------+--------------------------+--------------------------+
| MENA | 47.6% | 41.1% |
+--------------------------+--------------------------+--------------------------+
| US | 8.1% | 15.8% |
+--------------------------+--------------------------+--------------------------+
| Europe and rest of world | 44.3% | 43.2% |
+--------------------------+--------------------------+--------------------------+
MENA Injectables sales declined by 2.8% to $32.2 million, compared to $33.1
million in the first half of 2008. This decline is attributed to currency
impact and the timing of tender sales. Growth in the second half will be
generated by the realisation of these tender sales, an increase in sales in
Iraq, an increasing contribution from existing markets like Lebanon and Jordan,
and an initial contribution from newly launched oncology products.
It is our strategy to prioritise our own label sales in the US. We therefore
reduced private label sales in our US Injectables business by $7.0 million,
whilst our own label sales remained stable during the period. As a result, US
injectables sales declined by 56.9% to $5.5 million. We are limiting private
label sales in order to improve the market potential of our own label products.
Having successfully built a hospital sales force, we now have a greater
capability to market our own label products and drive profitable sales going
forward. We expect to deliver a much stronger performance in the US in the
second half of the year from our own label products and also as a result of a
new supply agreement signed with a leading group purchasing organisation.
Further sales growth will be driven by the four new product launches expected in
the second half of the year.
European injectable sales reached $30.0 million in the first half, down 13.6%
from $34.8 million in the first half of 2008. The decline is attributed mainly
to the foreign exchange rate movements, which had a negative impact of
approximately $4.6 million. In addition to the negative impact of exchange
rates, price erosion in the German market offset increased sales from new
product launches and an increasing market share in some of our newer markets.
During the first half of 2009, the Injectables business launched a total of
21 products across all markets, including 5 new compounds and 10 new dosage
forms and strengths. The Injectables business also received a total of 15
regulatory approvals across all regions and markets, including 7 in MENA, 3 in
Europe and 4 in the US. In the second half, we expect further sales will be
driven by these launches and an additional 19 launches expected in the second
half of the year.
Injectables gross profit decreased by 13.6 % to $29.2 million, compared to $33.8
million in the first half of 2008, with gross margin increasing to 43.2%,
compared to 42.0% in the first half of 2008. The increase in margin reflects a
shift in the mix of Injectables sales towards the MENA region, currency impact
and lower private label sales in the US.
Injectables operating profit decreased by 33.6% to $8.9 million, compared to
$13.5 million in the first half of 2008. Injectables operating margin decreased
to 13.2% in the first half of 2009, down from 16.7% in the first half of 2008.
This decline is explained by lower sales compounded by relatively fixed
operating expenses.
We remain confident that the performance of our Injectables business will
improve in the second half of the year, particularly in the MENA region and the
US, enabling us to deliver full year sales in line with 2008.
Generics
H1 2009 highlights:
* Delivered significant improvement in Generics revenues, up 43.2% to $61.8
million
* More than doubled gross margin to 33.8%
Revenue in our Generics business increased by 43.2% to $61.8 million, compared
to $43.1 million in the first half of 2008. This strong performance reflects
the actions of the strengthened management team and in particular focused sales,
marketing and operational improvements. It also reflects the changing
competitive environment in the US, which has increased demand for our
anti-infective products, our ability to successfully supply these products from
our FDA-approved manufacturing facilities in the MENA region, and a healthy
demand for a number of our US-produced products, including isosorbide
mononitrate and digoxin.
Over the past year we have rationalised our product portfolio and increased our
focus on our higher margin products. We have seen significant volume increases
for a number of our products and have implemented price increases across our
portfolio. Through focused sales targeting and improving service levels, we
have been developing better relationships with key wholesale and retail
customers, and are therefore improving the predictability of our revenue
streams. At the same time our operations have become more efficient.
All of these actions led to an increase in Generics gross profit of 205.7% to
$20.9 million, compared to $6.8 million in the first half of 2008. Gross margin
more than doubled from 15.8% in the first half of 2008 to 33.8% in the first
half of 2009. Consequently, the Generics segment achieved an operating
profit of $9.1 million in the first half of 2009, compared to an operating
loss of $6.0 million in the first half of 2008.
During the first half of 2009, the Generics business launched two new compounds
in three new dosage forms and strengths.
We are encouraged by the success we achieved in the Generics business in the
first half. We expect an increase in market pressure in the second half of the
year, but overall we are confident of delivering a strong performance for the
full year.
Other businesses
Other businesses, which primarily comprise Arab Medical Containers, a
manufacturer of plastic specialised packaging, and International Pharmaceuticals
Research Centre, which conducts bio-equivalency studies, contributed revenues of
$1.9 million, compared to revenue of $2.1 million in the first half of 2008.
These other businesses delivered an operating loss of $1.9 million in the first
half of 2009, compared to an operating loss of $2.3 million in the first half of
2008.
Research & Development3
The Group's product portfolio continues to grow. During the first half of the
year, we launched 12 new compounds, expanding the Group portfolio
to 379 compounds in 791 dosage forms and strengths. We manufacture and/or sell
40 of these compounds under-license from the originator.
Across all businesses and markets, a total of 72 products were launched during
the first half. In addition, the Group received 37 approvals.
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| | Total marketed products | Products launched in H1 2009 |
+-------------+---------------------------------------------+----------------------------------------------------+
| | Compounds | Dosage forms and | New compounds | New dosage forms | Total launches |
| | | strengths | | and strengths | in H1 2009* |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| | | | | | |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| Branded | 245 | 471 | 5 | 12 | 48 |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| | | | | | |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| Injectables | 85 | 212 | 5 | 10 | 21 |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| | | | | | |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| Generics | 49 | 108 | 2 | 3 | 3 |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| | | | | | |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| Group | 379 | 791 | 12 | 25 | 72 |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
| | | | | | |
+-------------+--------------------+------------------------+----------------+------------------+----------------+
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| | Products approved in H1 2009 | |
| | | Products pending approval as of 30 June 2009 |
+-------------+----------------------------------------------+----------------------------------------------------+
| | New | New dosage | Total | New compounds | New dosage forms | |
| | compounds | forms and | approvals in | | and strengths | Total pending |
| | | strengths | H1 2009* | | | approvals as |
| | | | | | | of 30 June |
| | | | | | | 2009* |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| | | | | | | |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| Branded | 5 | 8 | 22 | 32 | 56 | 525 |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| | | | | | | |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| Injectables | 3 | 6 | 15 | 17 | 29 | 224 |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| | | | | | | |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| Generics | 0 | 0 | 0 | 27 | 35 | 35 |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| | | | | | | |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| Group | 8 | 14 | 37 | 76 | 120 | 784 |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
| | | | | | | |
+-------------+--------------+----------------+--------------+----------------+------------------+----------------+
*Totals include all compounds and formulations that are either launched,
approved or pending approval across all markets.
3 Products are defined as pharmaceutical compounds sold by the Group. New
compounds are defined as pharmaceutical compounds not yet launched by the Group
and existing compounds being introduced into a new segment.
To ensure the continuous development of our product pipeline, we submitted
165 regulatory filings in the first half of the year across all regions and
markets. As of 30 June 2009, we had a total of 784 pending approvals across all
regions and markets.
We estimate the approximate addressable market for our portfolio of pending
approvals to be approximately $27 billion, based on the 2008 full year sales of
the currently marketed equivalent products in the markets covered by the pending
approvals.
At 30 June 2009, we had a total of 81 new products under development, the
majority of which should receive several marketing authorisations for differing
strengths and/or product forms over the next few years.
Net finance expense
Net finance expense decreased to $6.7 million, compared to $8.2 million in the
first half of 2008 due to lower net debt levels as explained in the operating
cash flow and investment section below.
Profit before tax
Profit before taxes for the Group increased by 28.5% to $50.5 million, compared
to $39.3 million in the first half of 2008.
Tax
The Group incurred a tax expense of $6.5 million in the first half of 2009. The
effective tax rate was 12.9%, a decrease of 2.3 percentage points on the
comparable period of 2008. The decline in the effective tax rate is attributed
the continued shift in the Group's overall geographic sales mix.
Profit for the period
The Group's profit attributable to equity holders of the parent increased by
31.4% to $43.2 million for the six months to 30 June 2009.
Earnings per share
Diluted earnings per share for the six months to 30 June 2009 were 22.3 cents,
up 31.2% from 17.0 cents in the first half of 2008.
Dividend
The Board has declared an interim dividend of 4.5 cents per share (approximately
2.75 pence per share) to be paid on 16 October 2009 to eligible shareholders on
the register at the close of business on 18 September 2009. The ex-dividend date
is 16 September 2009.
Operating cash flow and investment
The Group achieved an overall improvement in its working capital indicators.
Receivable days improved from 126 days as at 30 June 2008 to 115 days as at 30
June 2009. Inventory days improved from 194 days to 179 days and payable days
remained steady at 65 days. These improvements are a reflection of our continued
focus on improving collections, especially in the MENA region, increased
factoring of receivables and a leaner supply chain.
Working capital improvements coupled with improved profitability led to a
significant increase in operating cash flow to reach $36.2 million during the
first half, compared to $5.4 million during the first half of 2008.
Capital expenditures also declined to $14.3 million from $30.0 million due to
lower capital expenditure needs following three years of substantial expansion
projects.
As a result, net debt decreased from $197.6 million at 30 June 2008 and
$170.9 million as at 31 December 2008 to $164.4 million as at 30 June 2009
keeping the Group in a very strong financing position.
Principal risks and uncertainties
The Group's business faces risks and uncertainties which could have a
significant effect on its financial condition, results of operations or
performance over the remaining six months of the financial year and could cause
actual results to differ materially from expected and historical results. The
directors do not consider that the principal risks and uncertainties have
changed materially since the publication of the Annual Report & Accounts for the
year ended 31 December 2008, which can be found on pages 51 to 57 of the Annual
Report & Accounts, which is available at www.hikma.com, and which are summarised
below.
Operational risks
Regulatory
Hikma is subject to extensive regulation on the approval, manufacture and
distribution of its products in all its markets. There is no single worldwide
harmonised set of regulations relating to the development, manufacture and sale
of pharmaceutical products, and these laws and regulations may be subject to
unexpected change. This can create significant compliance costs, and can also
increase the time it takes to realize the full penetration of products into all
markets.
Economic and political dynamics
The Group operates in emerging markets. The failure of control, a change in the
economic conditions or political environment or sustained civil unrest in any
particular market or country could adversely affect the financial condition of
the Group.
Risk of interruption of production
Product manufacture is subject to continual regulatory control, inspection and
approval. Regulatory changes or compliance failure could result in interruptions
to production. The Group's manufacturing facilities could also be disrupted for
reasons beyond the Group's control such as fire, work force actions or other
issues.
Regulated and other suppliers
The Group benefits from close commercial relationships with a number of key
customers and suppliers. Damage to or loss of any of these relationships could
have a direct and detrimental effect on the Group's results. In addition a
compliance failure by any of our regulated suppliers could lead to delays in
production or increased costs or liabilities.
R&D and commercialisation of new products
Group results may be impacted significantly by the timeliness of its research
and development and product commercialisation activities. Additional costs may
be incurred, and sales opportunities lost, if there is a significant delay in
any of these steps.
Competitor risk
The Group operates in highly competitive markets with significant product
innovations. We are subject to the threat of our competitors entering our
markets, launching new products in existing markets and to pricing pressures on
our existing products.
Seasonality
The Group's business, in particular the Branded Pharmaceuticals business, is
seasonal, and generally experiences higher net sales and net profit in the first
half of each financial year, as compared to the second half of its financial
year. Accordingly, the Group's outstanding borrowings historically have been
higher during the first half of the financial year in order to finance the
working capital requirements of the Group.
Financial risks
Foreign exchange risk
The Group uses the US Dollar as its reporting currency and is therefore exposed
to foreign exchange movements, primarily in the European, Algerian, Sudanese and
Egyptian currencies, that could materially affect the Group's financial results.
Interest rate risk
The Group manages its exposures to interest rate risks by changing the
proportion of fixed rate debt and variable rate debt in its total debt
portfolio. To manage this mix the Group may enter into interest rate swap
agreements, in which it exchanges the periodic payments based on notional
amounts and agreed upon fixed and variable interest rates.
Credit Risk
In most cases, the Group grants its buyers credit terms for settlement of sales
invoices. Credit risk is managed through the Group Credit policy and the use of
various financial instruments such as letters of credit, factoring and credit
insurance arrangements. The Group has concentration of risk arising from
significant balances with key customers in the MENA region and the US.
Liquidity Risk
The Group has constant financing requirements, both for short-term working
capital needs and for long term strategic plans. The principal terms of the
Group's committed debt facilities and the directors' view on the sufficiency of
those facilities are described in note 2 to the condensed financial statements.
Outlook
Our expectations for the second half are positive and we re-iterate our guidance
of delivering full year sales growth of approximately 10% on current exchange
rates, or 15% in constant currency, with a 1% to 2% improvement in gross margin.
Responsibility statement
+---------------+
| We |
| confirm |
| that to |
| the |
| best of |
| our |
| knowledge: |
| |
| (a) the |
| condensed |
| set of |
| financial |
| statements |
| has been |
| prepared |
| in |
| accordance |
| with IAS |
| 34 |
| 'Interim |
| Financial |
| Reporting; |
| |
| (b) the |
| interim |
| management |
| report |
| includes a |
| fair review |
| of the |
| information |
| required by |
| DTR 4.2.7R |
| (indication |
| of |
| important |
| events |
| during the |
| first six |
| months and |
| description |
| of |
| principal |
| risks and |
| uncertainties |
| for the |
| remaining six |
| months of the |
| year); and |
| |
| (c) the |
| interim |
| management |
| report |
| includes a |
| fair review |
| of the |
| information |
| required by |
| DTR 4.2.8R |
| (disclosure |
| of related |
| parties' |
| transactions |
| and changes |
| therein). |
| |
+---------------+
| By |
| order |
| of the |
| Board |
| |
| |
| |
| Said |
| Darwazah |
| Bassam |
| Kanaan |
| Chief |
| Executive |
| Officer |
| Chief |
| Financial |
| Officer |
| |
| 26 August |
| 2009 |
| |
+---------------+
Cautionary statement
This Interim Management Report ("IMR") has been prepared solely to provide
additional information to shareholders to assess the Group's strategies and the
potential for those strategies to succeed. The IMR should not be relied on by
any other party or for any other purpose.
Forward looking statements
Certain statements in this announcement are forward-looking statements - using
words such as "intends", "believes", anticipates" and "expects". Where included,
these have been made by the Directors in good faith based on the information
available to them up to the time of their approval of this announcement. By
their nature, forward-looking statements are based on assumptions and involve
inherent risks and uncertainties that could cause actual results or events to
differ materially from those expressed or implied by the forward-looking
statements, and should be treated with caution. These risks, uncertainties or
assumptions could adversely affect the outcome and financial effects of the
plans and events described in this announcement. Forward-looking statements
contained in this announcement regarding past trends or activities should not be
taken as a representation that such trends or activities will continue in the
future. You should not place undue reliance on forward-looking statements, which
speak as only of the date of the approval of this announcement.
Except as required by law, the Company is under no obligation to update or keep
current the forward-looking statements contained in this announcement or to
correct any inaccuracies which may become apparent in such forward-looking
statements.
INDEPENDENT REVIEW REPORT TO HIKMA PHARMACEUTICALS PLC
We have been engaged by the company to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 30 June
2009 which comprises the condensed consolidated statement of comprehensive
income, the condensed consolidated balance sheet, the condensed consolidated
statement of changes in equity, the condensed consolidated cash flow statement
and related notes 1 to 13. We have read the other information contained in the
half-yearly financial report and considered whether it contains any apparent
misstatements or material inconsistencies with the information in the condensed
set of financial statements.
This report is made solely to the company in accordance with International
Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim
Financial Information Performed by the Independent Auditor of the Entity" issued
by the Auditing Practices Board. Our work has been undertaken so that we might
state to the company those matters we are required to state to them in an
independent review report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than
the company, for our review work, for this report, or for the conclusions we
have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved
by, the directors. The directors are responsible for preparing the half-yearly
financial report in accordance with the Disclosure and Transparency Rules of the
United Kingdoms' Financial Services Authority.
As disclosed in note 1, the annual financial statements of the Group are
prepared in accordance with IFRSs as adopted by the European Union. The
condensed set of financial statements included in this half-yearly financial
report has been prepared in accordance with International Accounting Standard
34, "Interim Financial Reporting," as adopted by the European Union.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.
Scope of Review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making inquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe
that the condensed set of financial statements in the half-yearly financial
report for the six months ended 30 June 2009 is not prepared, in all material
respects, in accordance with International Accounting Standard 34 as adopted by
the European Union and the Disclosure and Transparency Rules of the United
Kingdom's Financial Services Authority.
Deloitte LLP
Chartered Accountants and Registered Auditors
London, United Kingdom
26 August 2009
Notes: A review does not provide assurance on the maintenance and integrity of
the website, including controls used to achieve this, and in particular on
whether any changes may have occurred to the financial information since first
published. These matters are the responsibility of the directors but no control
procedures can provide absolute assurance in this area.
Legislation in the United Kingdom governing the preparation and dissemination of
financial information differs from legislation in other jurisdictions.
Hikma Pharmaceuticals PLC
Condensed consolidated statement of comprehensive income
+--------------------------------------------+-------+-------------+-------------+------------+
| | | H1 | H1 | FY |
| | | 2009 | 2008 | 2008 |
+--------------------------------------------+-------+-------------+-------------+------------+
| |Notes | $000's | $000's | $000's |
| | | (Unaudited) | (Unaudited) | (Audited) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Continuing operations | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Revenue | 3 | 321,495 | 299,912 | 580,656 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Cost of sales | 3 | (170,312) | (164,884) | (324,174) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Gross profit | 3 | 151,183 | 135,028 | 256,482 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Sales and marketing costs | | (47,303) | (47,149) | (90,560) |
+--------------------------------------------+-------+-------------+-------------+------------+
| General and administrative expenses | | (31,674) | (28,018) | (56,853) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Research and development costs | | (7,956) | (10,816) | (22,172) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Other operating expenses (net) | | (7,036) | (1,936) | (6,215) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Total operating expenses | | (93,969) | (87,919) | (175,800) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Adjusted operating profit | | 60,930 | 56,686 | 94,326 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Exceptional items | 12 | - | (6,005) | (6,429) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Intangible amortisation* | 12 | (3,716) | (3,572) | (7,215) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Operating profit | | 57,214 | 47,109 | 80,682 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Finance income | | 226 | 430 | 817 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Finance expense | | (6,923) | (8,601) | (17,545) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Other (expense) / income | | (64) | 321 | 80 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Profit before tax | | 50,453 | 39,259 | 64,034 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Tax | 4 | (6,493) | (5,942) | (6,915) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Profit for the period | | 43,960 | 33,317 | 57,119 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Other comprehensive income | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Cumulative effect of change in fair value | | 18 | - | (216) |
| of available for sale investments | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Cumulative effect of change in fair value | | 26 | 160 | (78) |
| of financial derivatives | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Exchange difference on translation of | | (3,552) | 9,955 | (15,454) |
| foreign operations | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Total comprehensive income for the period | | 40,452 | 43,432 | 41,371 |
+--------------------------------------------+-------+-------------+-------------+------------+
| | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Profit attributable to: | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Attributable to: | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Minority interest | | 730 | 405 | (6) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Equity holders of the parent | | 43,230 | 32,912 | 57,125 |
+--------------------------------------------+-------+-------------+-------------+------------+
| | | 43,960 | 33,317 | 57,119 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Total comprehensive income attributable | | | | |
| to: | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Attributable to: | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Minority interest | | 390 | 405 | (6) |
+--------------------------------------------+-------+-------------+-------------+------------+
| Equity holders of the parent | | 40,062 | 43,027 | 41,377 |
+--------------------------------------------+-------+-------------+-------------+------------+
| | | 40,452 | 43,432 | 41,371 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Earnings per share (cents) | | | | |
+--------------------------------------------+-------+-------------+-------------+------------+
| Basic | 6 | 22.8 | 17.6 | 30.4 |
+--------------------------------------------+-------+-------------+-------------+------------+
| Diluted | 6 | 22.3 | 17.0 | 29.6 |
+--------------------------------------------+-------+-------------+-------------+------------+
On this page and throughout these interim financial information "H1 2009" refers
to the six months ended 30 June 2009, "H1 2008" refers to the six months ended
30 June 2008 and "FY 2008" refers to the year ended 31 December 2008.
* Intangible amortisation comprises the amortisation on intangible assets other
than software.
Hikma Pharmaceuticals PLC
Condensed consolidated balance sheet
+----------------------------------------+-------+-------------+--------------+-----------+
| | | 30 June | 30 June | 31 |
| | | | | December |
+----------------------------------------+-------+-------------+--------------+-----------+
| | | 2009 | 2008 | 2008 |
+----------------------------------------+-------+-------------+--------------+-----------+
| |Notes | $000's | $000's | $000's |
| | | (Unaudited) | (Unaudited)* | (Audited) |
+----------------------------------------+-------+-------------+--------------+-----------+
| Non-current assets | | | | |
+----------------------------------------+-------+-------------+--------------+-----------+
| Intangible assets | | 254,746 | 267,824 | 258,228 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Property, plant and equipment | | 273,922 | 266,658 | 271,650 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Interest in joint venture | | 5,453 | 4,996 | 5,453 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Deferred tax assets | | 18,438 | 14,060 | 13,305 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Available for sale investments | | 557 | 842 | 540 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Financial and other non-current assets | | 2,030 | 1,916 | 2,077 |
+----------------------------------------+-------+-------------+--------------+-----------+
| | | 555,146 | 556,296 | 551,253 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Current assets | | | | |
+----------------------------------------+-------+-------------+--------------+-----------+
| Inventories | 7 | 166,635 | 167,970 | 154,756 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Trade and other receivables | 8 | 229,231 | 228,513 | 195,843 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Collateralised cash | | 1,025 | 720 | 819 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Cash and cash equivalents | | 50,526 | 21,767 | 62,727 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Other current assets | | 1,165 | 4,447 | 1,061 |
+----------------------------------------+-------+-------------+--------------+-----------+
| | | 448,582 | 423,417 | 415,206 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Total assets | | 1,003,728 | 979,713 | 966,459 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Current liabilities | | | | |
+----------------------------------------+-------+-------------+--------------+-----------+
| Bank overdrafts and loans | | 101,550 | 119,360 | 117,300 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Obligations under finance leases | | 708 | 882 | 1,221 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Trade and other payables | 9 | 104,094 | 93,124 | 82,003 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Income tax provision | | 12,824 | 12,459 | 12,016 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Other provisions | | 5,452 | 5,066 | 5,392 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Other current liabilities | | 7,082 | 16,373 | 10,502 |
+----------------------------------------+-------+-------------+--------------+-----------+
| | | 231,710 | 247,264 | 228,434 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Net current assets | | 216,872 | 176,153 | 186,772 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Non-current liabilities | | | | |
+----------------------------------------+-------+-------------+--------------+-----------+
| Long-term financial debts | | 108,340 | 93,944 | 110,414 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Deferred income | | 588 | 810 | 695 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Obligations under finance leases | | 5,358 | 5,911 | 5,496 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Deferred tax liabilities | | 12,353 | 11,574 | 12,425 |
+----------------------------------------+-------+-------------+--------------+-----------+
| | | 126,639 | 112,239 | 129,030 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Total liabilities | | 358,349 | 359,503 | 357,464 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Net assets | | 645,379 | 620,210 | 608,995 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Equity | | | | |
+----------------------------------------+-------+-------------+--------------+-----------+
| Share capital | | 34,010 | 33,751 | 33,857 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Share premium | | 270,900 | 269,503 | 269,973 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Own shares | | (2,203) | - | (1,124) |
+----------------------------------------+-------+-------------+--------------+-----------+
| Other reserves | | 336,496 | 310,723 | 300,503 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Equity attributable to equity holders | | 639,203 | 613,977 | 603,209 |
| of the parent | | | | |
+----------------------------------------+-------+-------------+--------------+-----------+
| Minority interest | | 6,176 | 6,233 | 5,786 |
+----------------------------------------+-------+-------------+--------------+-----------+
| Total equity | | 645,379 | 620,210 | 608,995 |
+----------------------------------------+-------+-------------+--------------+-----------+
*These numbers are revised - see note 1
Hikma Pharmaceuticals PLC
Condensed consolidated statement of changes in equity
+---------------------------------------+----------+-------------+-------------+-----------+
| | Merger | Revaluation | Translation | Retained |
| | reserve | reserves | reserves | earnings |
+---------------------------------------+----------+-------------+-------------+-----------+
| | $000's | $000's | $000's | $000's |
+---------------------------------------+----------+-------------+-------------+-----------+
| Balance at 1 January 2008 (Audited) | 33,920 | 4,627 | 19,792 | 215,853 |
+---------------------------------------+----------+-------------+-------------+-----------+
| Total comprehensive income for the | - | (90) | 9,955 | 33,162 |
| period | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Issue of equity shares | - | - | - | - |
+---------------------------------------+----------+-------------+-------------+-----------+
| Acquisition of own shares | - | - | - | - |
+---------------------------------------+----------+-------------+-------------+-----------+
| Cost of equity settled employee share | - | - | - | 1,307 |
| scheme | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Deferred tax arising on share-based | - | - | - | (261) |
| payments | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Dividends on ordinary shares | - | - | - | (7,542) |
+---------------------------------------+----------+-------------+-------------+-----------+
| Dividends paid to minority | - | - | - | - |
| shareholders | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Balance at 30 June 2008 (Unaudited) | 33,920 | 4,537 | 29,747 | 242,519 |
+---------------------------------------+----------+-------------+-------------+-----------+
| Balance at 1 January 2008 (Audited) | 33,920 | 4,627 | 19,792 | 215,853 |
+---------------------------------------+----------+-------------+-------------+-----------+
| Total comprehensive income for the | - | (180) | (15,454) | 57,011 |
| year | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Issue of equity shares | - | - | - | - |
+---------------------------------------+----------+-------------+-------------+-----------+
| Acquisition of own shares | - | - | - | - |
+---------------------------------------+----------+-------------+-------------+-----------+
| Cost of equity settled employee share | - | - | - | 3,384 |
| scheme | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Deferred tax arising on share-based | - | - | - | (4,299) |
| payments | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Dividends on ordinary shares | - | - | - | (14,151) |
+---------------------------------------+----------+-------------+-------------+-----------+
| Dividends paid to minority | - | - | - | - |
| shareholders | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Balance at 31 December 2008 (Audited) | 33,920 | 4,447 | 4,338 | 257,798 |
+---------------------------------------+----------+-------------+-------------+-----------+
| Total comprehensive income for the | - | (91) | (3,212) | 43,365 |
| period | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Issue of equity shares | - | - | - | - |
+---------------------------------------+----------+-------------+-------------+-----------+
| Acquisition of own shares | - | - | - | - |
+---------------------------------------+----------+-------------+-------------+-----------+
| Cost of equity settled employee share | - | - | - | 2,170 |
| scheme | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Current and deferred tax arising on | - | - | - | 1,335 |
| share-based payments | | | | |
+---------------------------------------+----------+-------------+-------------+-----------+
| Dividends on ordinary shares | - | - | - | (7,574) |
+---------------------------------------+----------+-------------+-------------+-----------+
| Balance at 30 June 2009 (Unaudited) | 33,920 | 4,356 | 1,126 | 297,094 |
+---------------------------------------+----------+-------------+-------------+-----------+
Hikma Pharmaceuticals PLC
Condensed consolidated statement of changes in equity
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| | Total | Share | Share | Own | Total | Minority | Total |
| | Other | capital | premium | shares | equity | interest | equity |
| | reserves | | | | attributable | | |
| | | | | | to equity | | |
| | | | | | shareholders | | |
| | | | | | of the | | |
| | | | | | parent | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| | $000's | $000's | $000's | $000's | $000's | $000's | $000's |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Balance at 1 January 2008 | 274,192 | 30,229 | 114,059 | - | 418,480 | 6,177 | 24,657 |
| (Audited) | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Total comprehensive income for | 43,027 | - | - | - | 43,027 | 405 | 43,432 |
| the period | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Issue of equity shares | - | 3,522 | 155,444 | - | 158,966 | - | 158,966 |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Acquisition of own shares | - | - | - | - | - | - | - |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Cost of equity settled employee | 1,307 | - | - | - | 1,307 | - | 1,307 |
| share scheme | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Deferred tax arising on | (261) | - | - | - | (261) | - | (261) |
| share-based payments | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Dividends on ordinary shares | (7,542) | - | - | - | (7,542) | - | (7,542) |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Dividends paid to minority | - | - | - | - | - | (349) | (349) |
| shareholders | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Balance at 30 June 2008 | 310,723 | 33,751 | 269,503 | - | 613,977 | 6,233 | 620,210 |
| (Unaudited) | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Balance at 1 January 2008 | 274,192 | 30,229 | 114,059 | - | 418,480 | 6,177 | 424,657 |
| (Audited) | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Total comprehensive income for | 41,377 | - | - | - | 41,377 | (6) | 41,371 |
| the year | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Issue of equity shares | - | 3,628 | 155,914 | - | 159,542 | - | 159,542 |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Acquisition of own shares | - | - | - | (1,124) | (1,124) | - | (1,124) |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Cost of equity settled employee | 3,384 | - | - | - | 3,384 | - | 3,384 |
| share scheme | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Deferred tax arising on | (4,299) | - | - | - | (4,299) | - | (4,299) |
| share-based payments | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Dividends on ordinary shares | (14,151) | - | - | - | (14,151) | - | (14,151) |
| | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Dividends paid to minority | - | - | - | - | - | (385) | (385) |
| shareholders | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Balance at 31 December 2008 | 300,503 | 33,857 | 269,973 | (1,124) | 603,209 | 5,786 | 608,995 |
| (Audited) | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Total comprehensive income for | 40,062 | - | - | - | 40,062 | 390 | 40,452 |
| the period | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Issue of equity shares | - | 153 | 927 | - | 1,080 | - | 1,080 |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Acquisition of own shares | - | - | - | (1,079) | (1,079) | - | (1,079) |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Cost of equity settled employee | 2,170 | - | - | - | 2,170 | - | 2,170 |
| share scheme | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Current and deferred tax arising | 1,335 | - | - | - | 1,335 | - | 1,335 |
| on share-based payments | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Dividends on ordinary shares | (7,574) | - | - | - | (7,574) | - | (7,574) |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
| Balance at 30 June 2009 | 336,496 | 34,010 | 270,900 | (2,203) | 639,203 | 6,176 | 645,379 |
| (Unaudited) | | | | | | | |
+----------------------------------+------------+----------+-----------+-----------+--------------+----------+------------+
Hikma Pharmaceuticals PLC
Condensed consolidated cash flow statement
+--------------------------------------------+------+-------------+-------------+-------------+
| | | H1 | H1 | FY |
| | | 2009 | 2008 | 2008 |
+--------------------------------------------+------+-------------+-------------+-------------+
| |Note | $000's | $000's | $000's |
| | | (Unaudited) | (Unaudited) | (Audited) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Net cash from operating activities | 10 | 36,246 | 5,442 | 74,969 |
+--------------------------------------------+------+-------------+-------------+-------------+
| Investing activities | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Purchases of property, plant and equipment | | (14,325) | (30,041) | (56,205) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Proceeds from disposal of property, plant | | 246 | 130 | 1,003 |
| and equipment | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Purchase of intangible assets | | (2,067) | (2,882) | (9,313) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Proceeds from disposal of intangible | | 738 | - | 1,257 |
| assets | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Investment in joint venture | | - | - | (910) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Investment in financial and other non | | 46 | (1,079) | (787) |
| current assets | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Proceeds from available for sale | | 1 | 166 | 252 |
| investments (net) | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Subsequent payments relating to prior year | | - | (1,934) | (2,234) |
| acquisitions | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Finance income | | 226 | 430 | 817 |
+--------------------------------------------+------+-------------+-------------+-------------+
| Net cash used in investing activities | | (15,135) | (35,210) | (66,120) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Financing activities | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| (Increase)/decrease in collateralised cash | | (206) | 4,908 | 4,809 |
+--------------------------------------------+------+-------------+-------------+-------------+
| Increase in long-term financial debts | | 30,768 | 41,904 | 101,685 |
+--------------------------------------------+------+-------------+-------------+-------------+
| Repayment of long-term financial debts | | (15,842) | (5,622) | (48,933) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Decrease in short-term borrowings | | (32,750) | (161,223) | (159,237) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Decrease in obligations under finance | | (650) | (360) | (436) |
| leases | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Dividends paid | | (7,574) | (7,557) | (14,151) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Dividends paid to minority shareholders | | - | (351) | (385) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Purchase of own shares | | (1,079) | - | (1,124) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Interest paid | | (6,992) | (8,632) | (17,097) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Proceeds from issue of new shares | | 1,080 | 161,450 | 162,026 |
+--------------------------------------------+------+-------------+-------------+-------------+
| Costs of issue of new shares | | - | (2,484) | (2,484) |
+--------------------------------------------+------+-------------+-------------+-------------+
| Net cash (used in)/from financing | | (33,245) | 22,033 | 24,673 |
| activities | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Net (decrease)/increase in cash and cash | | (12,134) | (7,735) | 33,522 |
| equivalents | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Cash and cash equivalents at beginning of | | 62,727 | 28,905 | 28,905 |
| period | | | | |
+--------------------------------------------+------+-------------+-------------+-------------+
| Foreign exchange translation movement | | (67) | 597 | 300 |
+--------------------------------------------+------+-------------+-------------+-------------+
| Cash and cash equivalents at end of period | | 50,526 | 21,767 | 62,727 |
+--------------------------------------------+------+-------------+-------------+-------------+
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements
1. General information
The financial information for the year ended 31 December 2008 does not
constitute statutory accounts within the meaning of Section 240 of the Companies
Act 1985. Statutory accounts for the year ended 31 December 2008, which were
prepared under International Financial Reporting Standards (IFRSs) issued by the
International Accounting Standards Board, have been filed with the Registrar of
Companies. The auditors' report on those accounts was unqualified did not drawn
attention to any matters by way of emphasis and did not contain any statement
under Section 237 (2) or (3) of the Companies Act 1985.
2. Accounting policies
The unaudited condensed set of financial statements for the six months ended 30
June 2009 have been prepared using the same accounting policies and on a basis
consistent with the audited results for the year ended 31 December 2008, other
than as noted below. The financial information has been prepared under the
historical cost convention, except for the revaluation to market of certain
financial assets and liabilities.
Basis of preparation
The currency used in the preparation of the accompanying consolidated financial
statements is the US Dollar as the majority of the Group's business is conducted
in US Dollars ($).
Comparative figures for 30 June 2008 have been adjusted for revisions to the
provisional acquisition balance sheet of the companies acquired by the Group in
2007. Further details are provided in note 11.
The Group's condensed consolidated financial statements included in this half
yearly financial report are prepared in accordance with IAS 34 'Interim
Financial Reporting' as adopted by the European Union. They were approved by the
Board on 26 August 2009.
Going concern
Although the current economic conditions may affect short-term demand for our
products, as well as place pressure on customers and suppliers which may face
liquidity issues, the Group's geographic spread, product diversity and large
customer and supplier base substantially mitigate these risks.
In addition, the Group operates in the relatively defensive generic
pharmaceuticals industry which we expect to be less affected compared to other
industries that are subject to greater cyclical changes.
The Group has $410 million of banking facilities of which $194 million were
undrawn as at 30 June 2009. These facilities are well diversified across the
operating subsidiaries of the Group with a number of financial institutions.
Over 50% of the Group's short term and undrawn long term facilities are of a
committed nature.
We continue to expect the short term facilities to be renewed upon maturity. In
addition the Group maintained cash balances of $51.6 million as at 30 June 2009.
The Group's forecasts, taking into account reasonable possible changes in
trading performance, facility renewal sensitivities and maturities of long-term
debt, show that the Group should be able to operate well within the levels of
its facilities and their related covenants.
After making enquiries, the Directors believe that the Group is adequately
placed to manage its business and financing risks successfully despite the
current uncertain economic outlook. Accordingly, they continue to adopt the
going concern basis in preparing the half yearly condensed financial statement.
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
2. Accounting policies continued
Changes in accounting policy
In the current financial year, the Group has adopted International Financial
Reporting Standard 8 "Operating Segments" and IAS 1 "Presentation of Financial
Statements" (revised 2007).
IFRS 8 requires operating segments to be identified on the basis of internal
reports about components of the Group that are regularly reviewed by the Chief
Executive to allocate resources to the segments and to assess their performance.
In contrast, the predecessor Standard (IAS 14 "Segment Reporting") required the
Group to identify sets of segments (Business and Geographical), using a risks
rewards approach, with the Group's system of internal financial reporting to key
management personnel serving only as the starting point for the identification
of such segments. The segmental information required by IAS 34 which is included
in note 3 below is presented in accordance with IFRS 8.
IAS 1(revised) requires the presentation of a statement of changes in equity as
a primary statement, separate from the income statement and statement of
comprehensive income. As a result a condensed consolidated statement of changes
in equity has been included in the primary statements, showing changes in each
component of equity for each period presented.
Exceptional items are defined as those that are material in nature or amount and
are non-recurring. Exceptional items are disclosed separately in the condensed
consolidated income statement to assist in the understanding of the financial
performance of the Group.
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
3. Business and geographical segments
For management purposes, the Group is currently organised into three operating
divisions - Branded , Injectables and Generics. These divisions are the basis
on which the Group reports its primary segment information. The segments
identified under IFRS 8 are unchanged from those previously disclosed under IAS
14.
Segment information about these businesses is presented below.
+---------------------------+-----------+-------------+----------+-----------+------------+
| Six months ended | Branded | Injectables | Generic | Others | Group |
+---------------------------+-----------+-------------+----------+-----------+------------+
| 30 June 2009 (unaudited) | $000's | $000's | $000's | $000's | $000's |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Revenue | 190,179 | 67,689 | 61,775 | 1,852 | 321,495 |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Cost of sales | (89,324) | (38,453) | (40,894) | (1,641) | (170,312) |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Gross profit | 100,855 | 29,236 | 20,881 | 211 | 151,183 |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Result | | | | | |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Adjusted segment result | 55,233 | 10,381 | 9,209 | (1,934) | 72,889 |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Intangible amortisation* | (2,210) | (1,440) | (66) | - | (3,716) |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Segment result | 53,023 | 8,941 | 9,143 | (1,934) | 69,173 |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Unallocated corporate | | | | | (11,959) |
| expenses | | | | | |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Operating profit | | | | | 57,214 |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Finance income | | | | | 226 |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Finance expense | | | | | (6,923) |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Other income | | | | | (64) |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Profit before tax | | | | | 50,453 |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Tax | | | | | (6,493) |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Profit for the period | | | | | 43,960 |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Attributable to: | | | | | |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Minority interest | | | | | 730 |
+---------------------------+-----------+-------------+----------+-----------+------------+
| Equity holders of the | | | | | 43,230 |
| parent | | | | | |
+---------------------------+-----------+-------------+----------+-----------+------------+
| | | | | | 43,960 |
+---------------------------+-----------+-------------+----------+-----------+------------+
*Intangible amortisation comprises the amortisation on intangible assets other
than software.
"Others" mainly comprises Arab Medical Containers LTD and International
Pharmaceutical Research Center LTD and the chemicals division of Hikma
Pharmaceuticals LTD Jordan.
Unallocated corporate expenses are primarily made up of employee costs, office
costs and professional fees.
+------------------------------------+------------+-------------+------------+-----------+--------------+
| | Branded | Injectables | Generic | Corporate | Group |
| | | | | and | |
| | | | | others | |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Other information 30 June 2009 | $000's | $000's | $000's | $000's | $000's |
| (unaudited) | | | | | |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Additions to property, plant and | 9,679 | 4,332 | 1,629 | 215 | 15,855 |
| equipment (cost) | | | | | |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Additions (disposals) to | 1,426 | 733 | 656 | (721) | 2,094 |
| intangible assets | | | | | |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Total property, plant and | 336,528 | 151,262 | 31,955 | 8,923 | 528,668 |
| equipment and intangible assets | | | | | |
| (net book value) | | | | | |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Depreciation and amortisation | 9,776 | 3,766 | 2,515 | 643 | 16,700 |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Balance sheet | | | | | |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Total assets | | | | | |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Segment assets | 664,165 | 201,581 | 117,213 | 20,769 | 1,003,728 |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Total liabilities | | | | | |
+------------------------------------+------------+-------------+------------+-----------+--------------+
| Segment liabilities | 221,012 | 87,052 | 31,599 | 18,686 | 358,349 |
+------------------------------------+------------+-------------+------------+-----------+--------------+
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
3. Business and geographical segments (continued)
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Six months ended | Branded | Injectables | Generic | Corporate | Group |
| | | | | and | |
| | | | | others | |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| 30 June 2008 (unaudited) | $000's | $000's | $000's | $000's | $000's |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Revenue | 174,039 | 80,597 | 43,133 | 2,143 | 299,912 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Cost of sales | (80,040) | (46,768) | (36,300) | (1,776) | (164,884) |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Gross profit | 93,999 | 33,829 | 6,833 | 367 | 135,028 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Result | | | | | |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Adjusted segment result | 53,737 | 14,820 | (1,173) | (2,326) | 65,058 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Exceptional items | (1,205) | - | (4,800) | - | (6,005) |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Intangible amortisation* | (2,144) | (1,362) | (66) | - | (3,572) |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Segment result | 50,388 | 13,458 | (6,039) | (2,326) | 55,481 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Unallocated corporate | | | | | (8,372) |
| expenses | | | | | |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Operating profit | | | | | 47,109 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Finance income | | | | | 430 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Finance expense | | | | | (8,601) |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Other income | | | | | 321 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Profit before tax | | | | | 39,259 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Tax | | | | | (5,942) |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Profit for the period | | | | | 33,317 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Attributable to: | | | | | |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Minority interest | | | | | 405 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| Equity holders of the | | | | | 32,912 |
| parent | | | | | |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
| | | | | | 33,317 |
+---------------------------+-----------+-------------+-----------+-----------+-----------+
*Intangible amortisation comprises the amortisation on intangible assets other
than software.
"Others" mainly comprises Arab Medical Containers LTD and International
Pharmaceutical Research Center LTD and the chemicals division of Hikma
Pharmaceuticals LTD Jordan.
Unallocated corporate expenses are primarily made up of employee costs, office
costs, professional fees and donations.
+------------------------------------+------------+-------------+-----------+-----------+------------+
| | Branded | Injectables | Generic | Corporate | Group |
| | | | | and Other | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Other information 30 June 2008 | $000's | $000's | $000's | $000's | $000's |
| (unaudited) | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Additions to property, plant and | 17,306 | 5,200 | 5,830 | 856 | 29,192 |
| equipment (cost) | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Additions to intangible assets | 1,084 | 1,599 | - | 199 | 2,882 |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Total property, plant and | 331,354 | 162,124 | 31,924 | 9,080 | 534,482 |
| equipment and intangible assets | | | | | |
| (net book value) | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Depreciation and amortisation | 9,466 | 4,697 | 2,220 | 760 | 17,143 |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Balance sheet | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Total assets | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Segment assets | 633,038 | 226,937 | 96,557 | 23,181 | 979,713 |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Total liabilities | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Segment liabilities | 191,854 | 113,693 | 41,727 | 12,229 | 359,503 |
+------------------------------------+------------+-------------+-----------+-----------+------------+
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
3. Business and geographical segments (continued)
+---------------------------+-----------+-------------+-----------+-----------+------------+
| | Branded | Injectables | Generic | Corporate | Group |
| | | | | and | |
| | | | | others | |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| 31 December 2008 | $000's | $000's | $000's | $000's | $000's |
| (audited) | | | | | |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Revenue | 320,837 | 149,320 | 105,696 | 4,803 | 580,656 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Cost of sales | (148,023) | (85,942) | (86,385) | (3,824) | (324,174) |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Gross profit | 172,814 | 63,378 | 19,311 | 979 | 256,482 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Result | | | | | |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Adjusted segment result | 93,591 | 24,688 | (839) | (3,738) | 113,702 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Exceptional items | (1,629) | - | (4,800) | - | (6,429) |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Intangible amortisation* | (4,478) | (2,587) | (150) | - | (7,215) |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Segment result | 87,484 | 22,101 | (5,789) | (3,738) | 100,058 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Unallocated corporate | | | | | (19,376) |
| expenses | | | | | |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Operating profit | | | | | 80,682 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Finance income | | | | | 817 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Finance expense | | | | | (17,545) |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Other income | | | | | 80 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Profit before tax | | | | | 64,034 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Tax | | | | | (6,915) |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Profit for the year | | | | | 57,119 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Attributable to: | | | | | |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Minority interest | | | | | (6) |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| Equity holders of the | | | | | 57,125 |
| parent | | | | | |
+---------------------------+-----------+-------------+-----------+-----------+------------+
| | | | | | 57,119 |
+---------------------------+-----------+-------------+-----------+-----------+------------+
*Intangible amortisation comprises the amortisation on intangible assets other
than software.
"Others" mainly comprises Arab Medical Containers LTD and International
Pharmaceutical Research Center LTD and the chemicals division of Hikma
Pharmaceuticals LTD Jordan.
Unallocated corporate expenses are primarily made up of employee costs, office
costs, professional fees and donations.
+------------------------------------+------------+-------------+-----------+-----------+------------+
| | Branded | Injectables | Generic | Corporate | Group |
| | | | | and Other | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Other information 31 December 2008 | $000's | $000's | $000's | $000's | $000's |
| (audited) | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Additions to property, plant and | 34,226 | 12,981 | 8,037 | 1,427 | 56,671 |
| equipment (cost) | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Additions to intangible assets | 3,801 | 4,781 | 463 | 1,601 | 10,646 |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Total property, plant and | 336,839 | 150,282 | 32,185 | 10,572 | 529,878 |
| equipment and intangible assets | | | | | |
| (net book value) | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Depreciation and amortisation | 18,666 | 8,540 | 4,613 | 1,303 | 33,122 |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Balance sheet | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Total assets | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Segment assets | 642,397 | 196,894 | 95,456 | 31,712 | 966,459 |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Total liabilities | | | | | |
+------------------------------------+------------+-------------+-----------+-----------+------------+
| Segment liabilities | 196,924 | 82,804 | 28,191 | 49,545 | 357,464 |
+------------------------------------+------------+-------------+-----------+-----------+------------+
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
4. Tax
+---------------------------------------------+-------------+------------+------------+
| | H1 2009 | H1 2008 | FY 2008 |
+---------------------------------------------+-------------+------------+------------+
| | $000's | $000's | $000's |
+ +-------------+------------+------------+
| | (Unaudited) | (Unaudited) | (Audited) |
+---------------------------------------------+---------------------------------------------+-------------+------------+
| Current tax: | | | |
+---------------------------------------------+-------------+------------+------------+
| UK current tax | 570 | 9,120 | 10,830 |
+---------------------------------------------+-------------+------------+------------+
| Double tax relief | (570) | (9,120) | (10,830) |
+---------------------------------------------+-------------+------------+------------+
| Foreign tax | 10,728 | 6,005 | 9,268 |
+---------------------------------------------+-------------+------------+------------+
| Prior year adjustments | 103 | - | 76 |
+---------------------------------------------+-------------+------------+------------+
| Deferred tax | (4,338) | (63) | (2,429) |
+---------------------------------------------+-------------+------------+------------+
| | 6,493 | 5,942 | 6,915 |
+---------------------------------------------+-------------+------------+------------+
5. Dividends
+-----------------------------------------------------+-----------------------------------------------------+-------------+-----------+
| | H1 2009 | H1 2008 | FY 2008 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+-----------+
| | $000's | $000's | $000's |
+ +-----------------------------------------------------+-------------+-----------+
| | (Unaudited) | (Unaudited) | (Audited) |
+-----------------------------------------------------+-----------------------------------------------------+-------------+-----------+
| Amounts recognised as distributions to equity | | | |
| holders in the year: | | | |
+-----------------------------------------------------+-----------------------------------------------------+-------------+-----------+
| Final dividend for the year ended 31 December 2008 | 7,574 | 7,542 | 7,542 |
| of 4.0 cents (2007: 4.0 cents) per share | | | |
+-----------------------------------------------------+-----------------------------------------------------+-------------+-----------+
| Interim dividend for the year ended 31 December | - | - | 6,609 |
| 2008 of 3.5 cents per share | | | |
+-----------------------------------------------------+-----------------------------------------------------+-------------+-----------+
| | 7,574 | 7,542 | 14,151 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+-----------+
'The proposed interim dividend for the period ended 30 June 2009 is 4.5 cents
(30 June 2008: 3.5 cents) per share.
6. Earnings per share
The calculation of the basic and diluted earnings per share is based on the
following data:
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| | H1 2009 | H1 2008 | FY 2008 |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| | $000's | $000's | $000's |
+ +---------------------------------------------------+-------------+-----------+
| | (Unaudited) | (Unaudited) | (Audited) |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| Earnings for the purposes of basic and diluted | 43,230 | 32,912 | 57,125 |
| earnings per share being net profit attributable | | | |
| to equity holders of the parent | | | |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| | Number | Number | Number |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| Number of shares | '000 | '000 | '000 |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| Weighted average number of Ordinary Shares for | 189,254 | 186,646 | 187,876 |
| the purposes of basic earnings per share | | | |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| Effect of dilutive potential Ordinary Shares : | | | |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| Share options and LTIP | 4,377 | 6,638 | 5,295 |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| Weighted average number of Ordinary Shares for | 193,631 | 193,284 | 193,171 |
| the purposes of diluted earnings per share | | | |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| | H1 2009 | H1 2008 | FY 2008 |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| | Earnings | Earnings | Earnings |
| | per share | per | per |
| | | share | share |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| | Cents | Cents | Cents |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| Basic | 22.8 | 17.6 | 30.4 |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
| Diluted | 22.3 | 17.0 | 29.6 |
+---------------------------------------------------+---------------------------------------------------+-------------+-----------+
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
7. Inventories
+-----------------------------------------------+-----------------------------------------------+--------------+------------+
| | H1 2009 | H1 2008 | FY 2008 |
+-----------------------------------------------+-----------------------------------------------+--------------+------------+
| | $000's | $000's | $000's |
+ +-----------------------------------------------+--------------+------------+
| | (Unaudited) | (Unaudited)* | (Audited) |
+-----------------------------------------------+-----------------------------------------------+--------------+------------+
| Finished goods | 46,048 | 50,602 | 45,585 |
+-----------------------------------------------+-----------------------------------------------+--------------+------------+
| Work-in-progress | 23,476 | 26,668 | 23,609 |
+-----------------------------------------------+-----------------------------------------------+--------------+------------+
| Raw and packing materials | 87,042 | 75,119 | 71,733 |
+-----------------------------------------------+-----------------------------------------------+--------------+------------+
| Goods in transit | 10,069 | 15,581 | 13,829 |
+-----------------------------------------------+-----------------------------------------------+--------------+------------+
| | 166,635 | 167,970 | 154,756 |
+-----------------------------------------------+-----------------------------------------------+--------------+------------+
Goods in transit include inventory held at third parties whilst in transit
between Group companies.
*These numbers are revised - see note 11
8. Trade and other receivables
+--------------------------------------------+--------------------------------------------+--------------+--------------+
| | 30 June | 30 June | 31 December |
+--------------------------------------------+--------------------------------------------+--------------+--------------+
| | 2009 | 2008 | 2008 |
+ +--------------------------------------------+--------------+--------------+
| | $000's (Unaudited) | $000's | $000's |
| | | (Unaudited)* | (Audited) |
+--------------------------------------------+--------------------------------------------+--------------+--------------+
| Trade receivables | 202,512 | 206,427 | 173,958 |
+--------------------------------------------+--------------------------------------------+--------------+--------------+
| Prepayments | 20,024 | 16,860 | 14,345 |
+--------------------------------------------+--------------------------------------------+--------------+--------------+
| Value added tax recoverable | 4,407 | 4,551 | 5,306 |
+--------------------------------------------+--------------------------------------------+--------------+--------------+
| Interest receivable | 157 | 245 | 108 |
+--------------------------------------------+--------------------------------------------+--------------+--------------+
| Employee advances | 2,131 | 430 | 2,126 |
+--------------------------------------------+--------------------------------------------+--------------+--------------+
| | 229,231 | 228,513 | 195,843 |
+--------------------------------------------+--------------------------------------------+--------------+--------------+
*These numbers are revised - see note 11
9. Trade and other payables
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| | 30 June | 30 June | 31 |
| | | | December |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| | 2009 | 2008 | 2008 |
+ +----------------------------------------------------+-------------+------------+
| | $000's (Unaudited) | $000's | $000's |
| | | (Unaudited) | (Audited) |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| Trade payables | 60,333 | 58,781 | 42,632 |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| Accrued expenses | 30,310 | 23,320 | 29,823 |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| Employees' provident fund * | 3,532 | 3,698 | 2,753 |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| VAT and sales tax payables | 3,625 | 1,124 | 1,408 |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| Dividends payable ** | 2,411 | 2,728 | 2,495 |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| Social security withholdings | 775 | 1,045 | 745 |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| Income tax withholdings | 1,442 | 1,030 | 1,037 |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| Other payables | 1,666 | 1,398 | 1,110 |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
| | 104,094 | 93,124 | 82,003 |
+----------------------------------------------------+----------------------------------------------------+-------------+------------+
* The employees' provident fund liability represents outstanding contributions
to Hikma Pharmaceuticals Limited - Jordan retirement benefit plan, on which the
fund receives 5% interest.
** Dividends payable includes $2,224,000 (30 Jun 2008: $2,514,000 and 31 Dec
2008: $2,303,000) due to the previous shareholders of APM.
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
10. Net cash from operating activities
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| | H1 | H1 | FY |
| | 2009 | 2008 | 2008 |
+ +-----------------------------------------------------+-------------+------------+
| | $000's (Unaudited) | $000's | $000's |
| | | (Unaudited) | (Audited) |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Profit before tax | 50,453 | 39,259 | 64,034 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Adjustments for: | | | |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Depreciation, amortisation and impairment of: | | | |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Property, plant and equipment | 12,428 | 13,050 | 25,067 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Intangible assets | 4,272 | 4,093 | 8,055 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Losses/(gains) on disposal of property, plant and | 161 | (4) | (6) |
| equipment | | | |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Gains on disposal of intangible assets | (425) | - | (832.00) |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Movement on provisions | 386 | 591 | 917 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Movement on deferred income | (107) | 530 | 416 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Cost of equity settled employee share scheme | 2,170 | 1,307 | 3,384 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Finance income | (226) | (430) | (817) |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Interest and bank charges | 6,923 | 8,601 | 17,545 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Cash flow before working capital | 76,036 | 66,997 | 117,763 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Change in trade and other receivables | (34,137) | (40,087) | (10,903) |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Change in other current assets | (104) | (1,822) | 1,564 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Change in inventories | (12,804) | (27,706) | (19,327) |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Change in trade and other payables | 20,654 | 12,061 | (693) |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Change in other current liabilities | (3,730) | 19 | (5,751) |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Cash generated by operations | 45,915 | 9,462 | 82,653 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Income tax paid | (9,669) | (4,020) | (7,684) |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
| Net cash generated from operating activities | 36,246 | 5,442 | 74,969 |
+-----------------------------------------------------+-----------------------------------------------------+-------------+------------+
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
11. Revision of acquisition balance sheets
Comparative figures for 30 June 2008 have been adjusted for revisions to the
provisional acquisition balance sheet of the companies acquired by the Group in
2007, being APM and Alkan.
There were no further revisions to those taken in 31 December 2008.
The following table illustrates those revisions:
+-------------------------------------+--------------+--------------+--------------+
| | 30 June 2008 | Final Fair | 30 June 2008 |
| | | value | |
| | (as | adjustments | (Restated) |
| | previously | USD '000 | $000's |
| | reported) | | |
| | $000's | | |
+-------------------------------------+ + + +
| | | | |
+-------------------------------------+--------------+--------------+--------------+
| Non-current assets | | | |
+-------------------------------------+--------------+--------------+--------------+
| Intangible assets | 263,534 | 4,290 | 267,824 |
+-------------------------------------+--------------+--------------+--------------+
| Property, plant and equipment | 263,903 | 2,755 | 266,658 |
+-------------------------------------+--------------+--------------+--------------+
| Interest in joint venture | 4,996 | - | 4,996 |
+-------------------------------------+--------------+--------------+--------------+
| Deferred tax assets | 14,060 | - | 14,060 |
+-------------------------------------+--------------+--------------+--------------+
| Available for sale investments | 842 | - | 842 |
+-------------------------------------+--------------+--------------+--------------+
| Financial and other non-current | 1,916 | - | 1,916 |
| assets | | | |
+-------------------------------------+--------------+--------------+--------------+
| | 549,251 | 7,045 | 556,296 |
+-------------------------------------+--------------+--------------+--------------+
| Current assets | | | |
+-------------------------------------+--------------+--------------+--------------+
| Inventories | 174,853 | (6,883) | 167,970 |
+-------------------------------------+--------------+--------------+--------------+
| Trade and other receivables | 229,219 | (706) | 228,513 |
+-------------------------------------+--------------+--------------+--------------+
| Collateralised cash | 720 | - | 720 |
+-------------------------------------+--------------+--------------+--------------+
| Cash and cash equivalents | 21,767 | - | 21,767 |
+-------------------------------------+--------------+--------------+--------------+
| Other current assets | 4,447 | - | 4,447 |
+-------------------------------------+--------------+--------------+--------------+
| | 431,006 | (7,589) | 423,417 |
+-------------------------------------+--------------+--------------+--------------+
| Total assets | 980,257 | (544) | 979,713 |
+-------------------------------------+--------------+--------------+--------------+
| Current liabilities | | | |
+-------------------------------------+--------------+--------------+--------------+
| Bank overdrafts and loans | 119,360 | - | 119,360 |
+-------------------------------------+--------------+--------------+--------------+
| Obligations under finance leases | 882 | - | 882 |
+-------------------------------------+--------------+--------------+--------------+
| Trade and other payables | 93,124 | - | 93,124 |
+-------------------------------------+--------------+--------------+--------------+
| Income tax provision | 12,459 | - | 12,459 |
+-------------------------------------+--------------+--------------+--------------+
| Other provisions | 5,066 | - | 5,066 |
+-------------------------------------+--------------+--------------+--------------+
| Other current liabilities | 16,353 | 20 | 16,373 |
+-------------------------------------+--------------+--------------+--------------+
| | 247,244 | 20 | 247,264 |
+-------------------------------------+--------------+--------------+--------------+
| Net current assets | 183,762 | (7,609) | 176,153 |
+-------------------------------------+--------------+--------------+--------------+
| Non-current liabilities | | | |
+-------------------------------------+--------------+--------------+--------------+
| Long-term financial debts | 93,944 | - | 93,944 |
+-------------------------------------+--------------+--------------+--------------+
| Deferred income | 810 | - | 810 |
+-------------------------------------+--------------+--------------+--------------+
| Obligations under finance leases | 5,911 | - | 5,911 |
+-------------------------------------+--------------+--------------+--------------+
| Deferred tax liabilities | 12,138 | (564) | 11,574 |
+-------------------------------------+--------------+--------------+--------------+
| | 112,803 | (564) | 112,239 |
+-------------------------------------+--------------+--------------+--------------+
| Total liabilities | 360,047 | (544) | 359,503 |
+-------------------------------------+--------------+--------------+--------------+
| Net assets | 620,210 | - | 620,210 |
+-------------------------------------+--------------+--------------+--------------+
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
12. Exceptional items and intangible amortisation
Exceptional items are disclosed separately in the condensed consolidated income
statement to assist in the understanding of the Group's underlying performance.
+--------------------------------------------------+-----------+-----------+-----------+
| | H1 | H1 | FY |
| | 2009 | 2008 | 2008 |
+--------------------------------------------------+-----------+-----------+-----------+
| | $000's | $000's | $000's |
+--------------------------------------------------+-----------+-----------+-----------+
| Revision to estimates for chargebacks, returns | - | (4,800) | (4,800) |
| and rebates | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| Acquisition integration costs | - | (1,205) | (1,629) |
+--------------------------------------------------+-----------+-----------+-----------+
| Exceptional items | - | (6,005) | (6,429) |
+--------------------------------------------------+-----------+-----------+-----------+
| Intangible amortisation | (3,716) | (3,572) | (7,215) |
+--------------------------------------------------+-----------+-----------+-----------+
| Exceptional items and intangible amortisation | (3,716) | (9,577) | (13,644) |
+--------------------------------------------------+-----------+-----------+-----------+
| Tax effect | 580 | 2,222 | 3,408 |
+--------------------------------------------------+-----------+-----------+-----------+
| Impact on profit for the period | (3,136) | (7,355) | (10,236) |
+--------------------------------------------------+-----------+-----------+-----------+
*Intangible amortisation comprises the amortisation of intangible assets other
than software.
Revision to estimates for chargebacks, returns, and rebates represents a one-off
charge taken against revenue during H1 2008.
Acquisition integration costs represent expenses incurred in integrating APM and
Hikma Pharma SAE (Egypt) into the Group. These are included within sales and
marketing and general and administrative expenses.
Hikma Pharmaceuticals PLC
Notes to the condensed set of financial statements - continued
13. Related party balances
Intra-group transactions have been eliminated on consolidation and are not
disclosed in this note.
During the period, the Group entered into the following transactions with
related parties:
Darhold Limited: is a related party of the Group because it is considered one of
the major shareholders of Hikma Pharmaceuticals PLC with ownership percentage of
30.1% at 30 June 2009 (30 June 2008: 30.7%, 31 December 2008: 30.2%)
Other than dividends (as paid to all shareholders), there were no transactions
between the Group and Darhold Limited in the year.
Capital Bank - Jordan: was a related party of the Group because two board
members of the Bank were also board members of Hikma Pharmaceuticals PLC during
2008. As at 31 December 2008, those two Board members were no longer board
members of Capital Bank. During 2008 total cash balances at Capital Bank -
Jordan as of 30 June 2008 was USD 259,000 (31 December 2008: USD 217,000). Loans
and overdrafts granted by Capital Bank to the Group at 30 June 2008 amounted to
USD 272,000 (31 December 2008: USD 207,000) with interest rates ranging between
8.75% and LIBOR + 1 to 1.25%. Total interest expense incurred in H1 2008 against
Group facilities was USD 21,000 (FY 2008: USD 86,000).
Jordan International Insurance Co: is a related party of the Group because one
board member of the company is also a board member of Hikma Pharmaceuticals PLC.
Total insurance premiums paid by the Group to Jordan International Insurance Co
during the period were USD 516,000 (H1 2008: USD 349,000 and FY 2008: USD
1,351,000). The Group's insurance expense for Jordan International Insurance Co
contracts in the period was USD 641,000 (H1 2008: USD 820,000 and FY 2008: USD
1,490,000). The amounts due to Jordan International Insurance Co at 30 June 2009
were USD 99,000 (30 June 2008: USD 185,000 and 31 December 2008: USD 93,000).
Tunisian Companies: amounts due from the two Tunisian companies in which the
Group has invested net of provisions include USD 627,000 (30 June 2008: USD
270,000 and 31 December 2008: USD 474,000) and USD 784,000 (30 June 2008: USD
444,000 and 31 December 2008: USD 793,000) due from Societe Hikma Medicef
Limited - Tunisia and Societe D'Industries Pharmaceutiques Ibn Al Baytar S.A. -
Tunisia, respectively. The provision for doubtful debts related to balances
above was USD 303,000 (30 June 2008: USD 154,000 and 31 December 2008: USD
303,000).
Labatec Pharma SA: is a related party of the Group because it is owned the by
Mr. Samih Darwazah. During H1 2009 the Group total sales to Labatec Pharma
amounted to USD 19,000 (FY 2008: USD 30,000) and the Group total purchases from
Labatec amounted to USD186,000. At 30 June 2009 the amount owed to Labatec
Pharma by the Group as at 30 June 2009 was USD 78,000 (31 December 2008: Nil).
Mr. Yousef Abd Ali: Mr. Yousef Abd Ali is a related party of the Group because
he holds 33% of Hikma Lebanon. The amount owed to Mr. Yousef by the Group as at
30 June 2009 was USD 161,000 (30 June 2008: USD 161,000 and 31 December 2008:
USD 161,000).
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR PUUQARUPBGBQ
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