Hikma Pharmaceuticals Plc Trading Statement (9879V)
November 09 2017 - 2:01AM
UK Regulatory
TIDMHIK
RNS Number : 9879V
Hikma Pharmaceuticals Plc
09 November 2017
Trading Update
London, 9 November 2017 - Hikma Pharmaceuticals PLC (Hikma,
Group) (LSE: HIK) (NASDAQ Dubai: HIK) (OTC: HKMPY) (rated Ba1
Moody's / BB+ S&P, both stable) is today updating the market on
its current trading.
Group
Our Injectables and Branded businesses are delivering a good
performance this year. Like many of our competitors, we are
experiencing challenging conditions in the US generics market and
as a result we are revising our full year expectations for our
Generics business. For the Group overall, we continue to expect
full year revenue to be around $2.0 billion in constant currency in
2017.
We remain committed to driving value from our marketed products,
bringing new products to market, increasing efficiencies and
delivering cost savings. Our strong cash flow and balance sheet are
providing a solid foundation for the Group and will support
continued investment across each of our businesses to ensure we can
deliver long-term, sustainable growth.
Injectables
Our global Injectables business is delivering a good performance
this year, driven by strong demand for our marketed portfolio and
new product launches, which has more than offset the impact of
increased competition on a number of our products. For the full
year in 2017, we continue to expect global Injectables revenue to
be around $775 million, with a very strong core operating margin of
around 39%. Whilst this reflects the resilient performance of our
business this year, we expect competition to intensify in 2018 and
margins to return to more normalised levels.
Generics
Growth in our Generics business this year continues to be
limited by the challenging market conditions that are impacting the
US generics industry. As a result of greater than expected price
and volume erosion, we now expect Generics revenue to be around
$600 million for the full year and core operating margin to be in
the low single-digits. We expect these market conditions to persist
in 2018 and are actively pursuing new commercial opportunities and
focusing on the execution of our pipeline to help offset continuing
price erosion across the industry. We are also identifying further
cost savings for this business, which will include the
consolidation of our oral manufacturing operations in the US.
Branded
The performance of our Branded business has been steadily
improving in the second half and we expect sales to accelerate
through the remainder of the year as a result of seasonality and
new product launches. We are reiterating our expectation for
Branded revenue growth in the mid-single digits in constant
currency in 2017.
On a reported basis, we continue to expect revenue and core
operating profit to be broadly in line with 2016. As previously
guided, this reflects an adverse currency impact, primarily due to
the devaluation of the Egyptian pound against the US dollar.(1)
Generic Advair update
On 11 May 2017, we announced the receipt of a complete response
letter (CRL) from the US Food and Drug Administration (FDA) in
relation to our abbreviated new drug application (ANDA) for our
generic version of GlaxoSmithKline's Advair Diskus(R) (fluticasone
propionate and salmeterol inhalation powder). Since then we,
supported by our partner Vectura, have had constructive discussions
with the FDA and we have been able to clarify and address the
majority of the questions raised.
However, there remains an outstanding issue regarding our
Clinical Endpoint (CEP) study. We firmly disagree with the FDA's
position and we are progressing with a dispute resolution process.
We now expect this process to be completed in the first quarter of
2018, at which point we will update the market and provide further
details on timelines.
Hikma and Vectura remain confident in the approvability of our
product and are committed to bringing this cost-effective
alternative to Advair Diskus(R) to the market as quickly as
possible.
Financing position
The Group continues to generate good cash flow and has a strong
balance sheet, which provides strategic and financial
flexibility.
We will announce our full year results for the year ended 31
December 2017 on 14 March 2018.
-- ENDS --
Enquiries
Hikma Pharmaceuticals PLC
Susan Ringdal VP Corporate Strategy and Director of Investor
Relations +44 (0)20 7399 2760/ +44 7776 477050
Lucinda Baker Deputy Director of Investor Relations +44 (0)20
7399 2765/ +44 7818 060211
Virginia Spring Investor Relations Manager +44 (0)20 3892 4389/
+44 7973 679502
FTI Consulting
Ben Atwell/ Brett Pollard +44 (0)20 3727 1000
About Hikma
Hikma Pharmaceuticals PLC is a multinational pharmaceutical
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: 'Injectables,' 'Generics' and 'Branded,' based
primarily in the Middle East and North Africa (MENA) region, where
it is a market leader, the United States and Europe. In 2016, Hikma
achieved revenues of $1,950 million and profit attributable to
shareholders of $155 million.
(1) On 2 November 2017, the Egyptian pound had devalued against
the US dollar from its peg of 8.8 EGP:USD prior to 3 November 2016
to 17.6 EGP:USD (www.oanda.com)]
This information is provided by RNS
The company news service from the London Stock Exchange
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