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Aspen Pharmacare reports 18% drop in half-year profit

Profit from continuing operations up 11%.
Revenues up 17% led by demand for drugs. Image: Supplied

Aspen Pharmacare said on Thursday its half-year profits were down 18% and that a technical transfer for manufacturing Johnson & Johnson’s Covid-19 vaccines will complete before June.

The company said half-year total headline earnings per share (Heps) were 566.2 cents, down from 689.7 cents reported in the same period a year ago, mainly on account of the sale of its European business which was concluded in November.

Heps from continuing operations increased by 11% to 571.0 cents, it said. Heps is the main profit measure for South African companies.

Aspen, which is Africa’s biggest pharmaceutical company, had said earlier in January that it would be manufacturing J&J’s Covid-19 vaccine by the end of March.

“Technical transfer is expected to be completed during the second quarter of calendar year 2021 with commercial production contributing to our results toward the end of the current financial year,” the company said.

The pharmaceutical company sells branded prescription drugs and over-the-counter medicines and sterile products or those that are directly administered into blood vessels.

Its revenue for the six months to end December 2020 rose 17% to R18.6 billion rand, led by its branded and manufacturing divisions.

Most pharmaceutical companies took a hit last year on sales and profits as countries went into a lockdown hurting demand for prescription and over-the-counter products.

But their shares have risen of late as people who had postponed elective or non-emergency procedures restarted doctor and hospital visits.

Aspen’s shares, which hit a trough in March last year, have risen by more than 90%. Its shares closed up almost 1% against the broader index, which ended up 0.4% on Thursday.

Aspen’s results were announced after the stock market closed.

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