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Lavipharm – H1 2012 Financial Results

Lavipharm – H1 2012 Financial Results

 

During H1 2012, in an environment characterized by a political instability and recession rates, Lavipharm focused on enhancing its export activities, sustaining its market shares and strengthening its competitiveness while reducing operational costs and increasing productivity.

In H1 2012, consolidated financial results were significantly affected by Lavipharm’s wholesaling activity which was narrowed to a low but safe turnover, aiming to decrease its market exposure in view of the turbulence in the sector which commenced the previous year. In that context, Lavipharm’s consolidated turnover dropped to € 19.0 million from € 94.2 million in H1 2011. On the contrary, the profit margin has been significantly increased, since most of the sales are generated from commercial activity, where margins are higher than in the wholesaling business. It is worth mentioning that exports show an increase compared to H1 2011, mainly due to fentanyl patch’s new markets. In H1 2012, the product’s exports have already exceeded 2011 annual sales.

The continuing efforts for lowering costs led to a 29.0% decrease in operating expenses. Nevertheless, the drop of sales has affected the consolidated EBITDA, which decreased to € 593 K from € 2.2 million in H1 2011. It is worth mentioning that despite the harsh economic environment, Lavipharm Group has reduced its loan obligations, lowering this way its financial expenses, in a period where average financial costs have increased significantly. At the same time, a considerable part of its short term debt has been converted into long term. Consolidated losses reached €5.4 million from €4.7 million in H1 2011 and losses after taxes and minority interests €4.7 million from €3.5 million in the same period last year.

Finally, despite the parent company‘s (Lavipharm SA) high Shareholders’ Equity (€91.07 million), consolidated Shareholders’ Equity has turned negative by €3.96 million, due to the consolidation of accumulated over the years subsidiaries’ losses. Management is focusing on improving the Group’s profitability and enhancing Shareholders’ Equity.

Regarding the financial results of the parent company Lavipharm SA, turnover has been reduced to €19.7 million from €24.7 in H1 2011, resulting primarily from the decrease in pharmaceutical sales. Nevertheless, as Gross Profits have been slightly improved, and operating expenses have dropped by a 7.9%, EBITDA was kept at last year’s level (€1.395K from €1.433K), slightly decreased by €38K. Finally, the drop of financial costs achieved through the reduction of loan obligations has resulted to the confinement of losses after taxes to €1.040K in H1 2012 from €1.129K in H1 2011.

Focusing on the company’s growth and development and given the current international economic and business constraints, Lavipharm carefully and diligently proceeds with all the necessary actions required to further enhance its commercial presence in Greece and its positioning as a key player in the global pharmaceutical market.