SCHWARZ PHARMA to continue positive trend
· Sales +3.1% · Net Profit DM 33.5m; DM 1.52/Euro 0.78 per share · Increase of the previous budget figures
Sales of the Schwarz Pharma Group from January to September 2000, were DM 1,056.5 million, which is a 3,1% increase over 1999. After allowing for exchange rate effects, acquisition and divestiture, adjusted growth in sales was 2.4%.
“We are continuing the positive development of the first half year and we are aiming to beat our target - of achieving sales at least equal to the previous year,” said Patrick Schwarz-Schütte, CEO of Schwarz Pharma AG. “We are further strengthening research and development. Overall we will invest DM 200 million in this area until the end of year. Nevertheless we expect net income for the year exceeding 1999 net income by approximately 50%.”
Europe with above average increase
This increase in sales is attributable to a 14% growth to DM 390.1 million of the European markets. Specific contributors to this development were the subsidiaries in Spain with a sales increase of 10%, Italy of 16.8% and Poland of 38%.
With sales of DM 283.4 million, Germany is slightly behind 1999 amounts (-1.2%). Relevant products in Germany are the cardiovascular drug ISOKET® (isosorbide dinitrate) with DM 43.5 million, the gastrointestinal product RIFUN® (pantroprazol) with DM 43.2 million and PROSTAVASIN® (alprostadil), a drug to treat peripheral arterial occlusive disease, with DM 39.7 million. The innovative asthma drug ATMADISC® (salmeterol/ fluticason) completed the range of products since its launch in September.
The contribution to sales from the USA was slightly below 1999 with sales of DM 305.1 million (1999: DM 308,7 million). The antihypertensive drug UNIVASC®/UNIRETIC® made a major contribution to sales with DM 68 million.
Sales on the Asian markets more than doubled from DM 7.9 million in 1999 to DM 18 million in 2000.
Financial Situation
Gross profit was up slightly by 0.7% to DM 620.5 million. The reason is that costs of goods rose by 6.6% as a result of the product mix. Selling expense, general and administrative costs increased at a lower rate than sales by 1.7% to DM 426.1 million. Research and development costs significantly inclined by 48.3% due to the scheduled development of clinical studies with steadily growing numbers of patients.
Operating income was DM 36.6 million compared to DM 55.3 million for the same period of 1999. Excluding research and development, operating income rose by 14%. The financial result as of September 30 was DM 18 million. Pre-tax earnings were DM 53 million. With a tax rate of 37%, earnings after tax were as high as DM 33.5 million or DM 1.52/Euro 0.78 Euro per share.
Considering reductions in current assets (-10%) and current liabilities (-15%), the balance sheet total reduced as of September 30, 2000 by 2.3% to DM 1,657.1 billion compared to December 31, 1999. The equity ratio was 60.7% (1999: 56.4%).
Net cash of DM 144.7 million (+4%) from operating activities exceeded the net cash used in investing activities. Net investments as of September 30 were DM 50 million. The net cash used in financing activities of DM 111.7 million include repayments of debt of DM 68.2 million in total. Cash and cash equivalents were reduced by DM 13
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