London-listed Hikma Pharmaceuticals expects sales growth in 2020 after posting a 10 per cent rise in annual core operating profit for 2019 driven by higher revenue as demand for its injectable drugs grew.
The drugmaker's group core operating profit rose to $508 million (Dh1.86 billion) in the year ending December 31, up from $460m in 2018, Hikma said in a filing to the London Stock Exchange on Thursday. Full-year group core revenue increased 6 per cent to $2.2bn, beating analyst estimates.
"2019 was another very good year for Hikma, driven by strong demand for our broad product portfolio," Siggi Olafsson, chief executive of Hikma, said. "During a challenging year for the industry, we delivered strong financial performance and made important progress on our strategic objectives, including strengthening our operations, building our portfolio and pipeline, forming new partnerships, developing our people and attracting new talent."
Hikma, which produces and markets a wide range of branded and non-branded generic medicines, has been helped by newer launches that cushioned it from drug pricing pressure in the US - its biggest market. It's second largest market is Saudi Arabia, followed by Egypt.
The company's US business recorded a 61 per cent increase in revenue in 2019 to $1.35bn, followed by its business in the Middle East and North Africa which saw a 33 per cent rise to $719m.
"Saudi Arabia and Egypt, performed well - reflecting strong market positions and good demand for marketed products and new launches," it said. "Hikma also delivered a good performance across most of its other Mena markets, which more than offset significantly lower sales in Algeria resulting primarily from political and economic disruptions."
Hikma's business segments all recorded double-digit revenue growth in 2019, led by the injectable drugs business. That segment's revenue grew 40 per cent to $890m.
The company proposed a dividend of 30 cents in 2019, pending approval by shareholders at its annual general meeting on April 30.
In 2020, Hikma expects its injectable drugs revenue to grow in the "low to mid-single digits", driven by new product launches and demand for its existing products across all of its markets, which should "more than offset" continued price erosion, it said.
The company forecasts its generic drugs revenue to be in the range of $700m to $750m while its branded medicine revenue is projected to grow in the mid-single digits in constant currency in 2020.
It expects group capital expenditure in the range of $120m to $140m.
Hikma added it does not anticipate any "material impact" on its operations from the outbreak of the coronavirus, which broke out in China and spread rapidly around the world, as it does not have extensive operations or manufacturing in China and does not directly depend on Chinese-manufactured goods or services.
"This is a complex situation that we are continually monitoring," Hikma said.
The group has a stake in Hubei Haosun Pharmaceutical, located in China's Hubei province, the epicentre of the coronavirus outbreak, according to its website.