DGAP-News: STADA Arzneimittel AG / Key word(s): Half Year Results
STADA Arzneimittel AG: Solid result in difficult market environment -
Group sales increase by 4 percent - adjusted key earnings figures
substantially higher than previous year - reported net income
approximately at prior-year level
07.08.2014 / 07:25
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Important items at a glance
- Group sales increase to Euro 1,002.8 million (+4 percent) - adjusted
for currency and portfolio effects -1 percent
- Adjusted sales in Russia -9 percent, adjusted sales in Central Europe
+3 percent
- Despite the difficult market environment, particularly in Russia, and
high burdens from currency translation effects of Euro 12.6 million
before tax due to the fluctuation of the Russian ruble as well as
further significant currencies of the market region CIS/Eastern Europe,
reported EBITDA rises to Euro 192.1 million (+5 percent) - adjusted
EBITDA records growth to Euro 208.3 million (+10 percent)
- Reported net income is - despite the high one-time special effects
particularly from currency translation expenses and impairments from
acquisitions - approximately at the same level of the corresponding
period of the previous year with Euro 66.8million - adjusted net
income records substantial growth to Euro 90.1 million (+29 percent)
- Share of branded products in adjusted operating profit of core segments
amounts to 51 percent
- Outlook for 2014 confirmed
STADA Key Figures
<pre>
1-6/2014 1-6/2013 +/-
Group sales Euro 1,002.8 million Euro 966.8 million +4%
Operating profit, reported Euro 121.2 million Euro 129.5 million -6%
Operating profit, adjusted Euro 152.2 million Euro 135.4 million +12%
EBITDA, reported Euro 192.1 million Euro 183.4 million +5%
EBITDA, adjusted Euro 208.3 million Euro 189.1 million +10%
Net income, reported Euro 66.8 million Euro 66.6 million 0%
Net income, adjusted Euro 90.1 million Euro 70.1 million +29%
Earnings per share Euro 1.11 Euro 1.12 -1%
Earnings per share, adjusted Euro 1.49 Euro 1.18 +26%
</pre>
Bad Vilbel, August 7, 2014 - In the first half of 2014, the STADA Group's
business development was characterized by difficult framework conditions in
the two market regions of CIS/Eastern Europe and Germany. The Group was
also burdened by one-time special effects in connection with high currency
translation expenses recorded in the income statement. Overall, the Group's
development was within the scope of expectations. Group sales rose. All
adjusted key earnings figures recorded substantial growth.
"Within the context of our active acquisitions policy, we were able to
strengthen our branded products segment in the first half of 2014 with
three attractive acquisitions. With the expansion of high-margin branded
products, we are consistently moving our growth strategy forward and at the
same time are making ourselves increasingly independent of the regulated
generics area - particularly in the German market", says Hartmut Retzlaff,
Chairman of the Executive Board of STADA Arzneimittel AG.
Development of sales
Group sales increased by 4 percent to Euro 1,002.8 million in the first six
months of 2014 (1-6/2013: Euro 966.8 million).
Sales of the core segment Generics decreased by 2 percent to
Euro 598.7 million in the reporting period (1-6/2013: Euro 613.3 million),
primarily due to the development in the markets of Germany and Russia.
Generics thus contributed 59.7 percent to Group sales (1-6/2013: 63.4
percent). Sales of the core segment Branded Products recorded substantial
growth of 14 percent to Euro 381.6 million in the first half of 2014
(1-6/2013: Euro 333.6 million). Branded Products thus contributed 38.1
percent to Group sales (1-6/2013: 34.5 percent).
Development of earnings
Reported operating profit decreased in the half year under review by 6
percent to Euro 121.2 million (1-6/2013: Euro 129.5 million). Reported
EBITDA rose by 5 percent to Euro 192.1 million (1-6/2013: Euro 183.4
million). Reported net income was - despite the high one-time special
effects - approximately at the same level of the corresponding period of
the previous year with Euro 66.8 million (1-6/2013: Euro 66.6 million).
After adjusting the key earnings figures for influences distorting the
period comparison resulting from one-time special effects, adjusted
operating profit showed growth of 12 percent in the first six months of
2014 to Euro 152.2 million (1-6/2013: Euro 135.4 million). Adjusted EBITDA
rose by 10 percent to Euro 208.3 million (1-6/2013: Euro 189.1 million).
Net income, adjusted for one-time special effects and effects from the
measurement of derivative financial instruments under financial income and
expenses, increased substantially by 29 percent to Euro 90.1 million
(1-6/2013: Euro 70.1 million).
The significant increase of adjusted net profit can primarily be attributed
to a substantial reduction of the effective tax rate as of the first
quarter of 2014. This development results from a changed profit allocation
in the STADA Group, which has been primarily influenced by the successful
conclusion of the "STADA - build the future" project at the end of
financial year 2013 and a connected adjustment of the internal transfer
pricing model. As a consequence, STADA Arzneimittel AG has been using,
among other things, tax interest carryforwards in Germany since the
beginning of the current financial year, which resulted from applying the
regulations in connection with the so-called interest barrier in previous
periods. Against this background, the adjusted effective tax rate for the
first six months of 2014 decreased to 22.5 percent in comparison to the
corresponding period of the previous year (1-6/2013: 33.6 percent). The
reported tax rate decreased by almost 10 percentage points in comparison to
the corresponding period of the previous year to 24.0 percent (1-6/2013:
33.9 percent).
The net debt to adjusted EBITDA ratio was at 3.5 in the reporting period
(1-6/2013: 3.2).
Development of the market regions
The four STADA market regions recorded varying developments in the first
half of the current financial year. In market region Germany, sales
decreased by 5 percent. In Central Europe, sales increased substantially by
15 percent. In CIS/Eastern Europe, sales grew by 4 percent applying the
exchange rates of the previous year whereas sales in Euro declined by 9
percent as a result of negative currency effects. In market region Asia &
Pacific, sales increased significantly by 50 percent.
In market region Germany, sales in the first half of 2014 recorded a
decrease of 5 percent to Euro 227.0 million (1-6/2013: Euro 238.6 million).
This development is primarily attributable to the still decreasing generics
sales in this market region, which could not be compensated through a
positive branded products business of the German sales companies and an
increase in export activities. This market region contributed a total of
22.6 percent to Group sales (1-6/2013: 24.7 percent).
Sales in market region Central Europe recorded strong growth - despite the
high basis of comparison in the corresponding period of the previous year
and in consideration of the acquisition of the British OTC supplier
Thornton & Ross Ltd. completed in the second half of 2013 - of 15 percent
to Euro 467.4 million in the half year under review (1-6/2013:
Euro 407.3 million). Sales achieved in this market region thereby
contributed 46.6 percent to Group sales (1-6/2013: 42.1 percent). In market
region Central Europe, sales saw particularly pleasing developments in the
United Kingdom with significant growth of 134 percent, in Spain with a plus
of 9 percent and in Italy with growth of 8 percent.
In market region CIS/Eastern Europe, sales in the first six months of the
current financial year grew by 4 percent applying the exchange rates of the
previous year. In euro, sales recorded a decline of 9 percent to
Euro 265.6 million as a result of negative currency effects (1-6/2013:
Euro 292.5 million). Sales achieved in this market region thereby
contributed 26.5 percent to Group sales (1-6/2013: 30.3 percent). In
Russia, sales decreased by 2 percent in the first half of 2014 applying the
exchange rates of the previous year. As a result of a clearly negative
currency effect of the Russian ruble, sales decreased in euro by 16 percent
to Euro 163.5 million (1-6/2013: Euro 194.2 million). In Serbia, sales rose
substantially by 15 percent in the reporting period applying the exchange
rates of the previous year. In euro, sales increased by
11 percent to Euro 44.8 million despite a negative currency effect of the
Serbian dinar (1-6/2013: Euro 40.3 million).
Sales in market region Asia & Pacific recorded a significant rise of 50
percent to Euro 42.8 million in the reporting period (1-6/2013:
Euro 28.4 million). The sales contribution of this market region to Group
sales was at 4.3 percent (1-6/2013: 2.9 percent). The growth in market
region Asia & Pacific was primarily a result of the sales rise following
the consolidation of STADA Vietnam J.V. Co., Ltd., Vietnam, and STADA
Pharmaceuticals Beijing Ltd., China, as subsidiaries.
Development, production and procurement
Research and development costs amounted to Euro 29.3 million in the first
six months of the current financial year (1-6/2013: Euro 27.4 million).
Worldwide, STADA launched a total of 301 individual products in the
individual national markets in the first half of 2014 (1-6/2013: 343
product launches).
Outlook
The Executive Board confirms the outlook for financial year 2014. According
to this, STADA expects slight growth in Group sales, adjusted EBITDA and
adjusted net income. For reasons of transparency, the adjustments as from
2014 also include currency translation effects recorded in the income
statement from the fluctuation of the Russian ruble as well as further
significant currencies of the market region CIS/Eastern Europe.
STADA Adjustments
<pre>
1-6/2014
Net income, reported Euro
66.8
million
One-time effects
Burden from currency effects recorded in the income statement Euro
resulting from the fluctuation of the Russian ruble as well as +10.5
further significant currencies of the market region CIS/Eastern million
Europe
Burden from additional impairments and other measurement effects Euro
due to purchase price allocations as well as significant product +7.3
acquisitions taking financial year 2013 as basis million
Burden from value adjustments netted of write-ups on intangible Euro
assets after impairment tests +5.2
million
Burden for several extraordinary expenses among other things Euro
provisions for damage claims in connection with a lost patent +1.8
litigation in the market region Central Europe million
Relief on earnings from the measurement of derivative financial Euro
instruments under financial income and expenses -1.5
million
Total one-time effects Euro
23.3
million
Net income, adjusted Euro
90.1
million
</pre>
Additional information for analysts:
STADA Arzneimittel AG / Investor Relations / StadastraÃe 2-18 / 61118 Bad
Vilbel - Germany / Phone: +49 (0) 6101 603-113 / Fax: +49 (0) 6101 603-506
/ e-mail: communications@stada.de
Additional information for journalists:
STADA Arzneimittel AG / Media Relations / StadastraÃe 2-18 / 61118 Bad
Vilbel - Germany / Phone: +49 (0) 6101 603-165 / Fax: +49 (0) 6101 603-506
/ e-mail: press@stada.de
Or visit us in the Internet at www.stada.com.
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07.08.2014 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
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Language: English
Company: STADA Arzneimittel AG
StadastraÃe 2-18
61118 Bad Vilbel
Germany
Phone: +49 (0)6101 603- 113
Fax: +49 (0)6101 603- 506
E-mail: communications@stada.de
Internet: www.stada.de
ISIN: DE0007251803, DE0007251845,
WKN: 725180, 725184,
Indices: MDAX
Listed: Regulierter Markt in Düsseldorf, Frankfurt (Prime
Standard); Freiverkehr in Berlin, Hamburg, Hannover,
München, Stuttgart
End of News DGAP News-Service
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281091 07.08.2014
DGAP-News: STADA Arzneimittel AG: Solid result in difficult market environment - Group sales increase by 4 percent - adjusted key earnings figures substantially higher than previous year - reported net income approximately at prior-year level
| Source: EQS Group AG