RICHTER GEDEON - Stronger than expected profits driven by higher sales and cost cuts
o Richter posted clean EBIT of HUF 36.2 bn on net sales HUF 140.9 bn for Q2/21,
ahead of consensus estimates of HUF 29.8 bn and HUF 147.6 bn.
o Key positives:
1. US sales driven by Vraylar (USD 79 mn vs USD 58.8 mn YoY excl. one-off salesrelated income and USD 69.2 mn QoQ) slightly beat our estimate. other US sales
were better than expected.
2. Russian and Ukrainian sales caught us by surprise (+14% and +80% YoY).
3. Chinese and EU15 sales were also ahead of our estimates (+45% and -21% YoY)
4. WHC sales grew by 26% YoY mainly thanks to Evra sales.
5. S&M expenses (17.8% of sales) was much lower than expected (seems to be
unsustainable), as did R&D expenses (10% of sales), while A&G expenses remained
also under strict control as a response to COVID-19, therefore OpEx declined by
1% YoY.
6. Clean EBIT margin was 23.1% vs. 22.6% YoY and consensus estimate of 20.2%.
7. EBIT margin on other drugs than Vraylar increased to 12.3% from 4.0% in Q1/21
Chemical Works of Richter Gedeon is a multinational pharmaceutical company that is engaged in the research, development, production and marketing and trade of pharmaceutical products. Co.'s activities are divided into two major business segments: Pharmaceutical, including research, development and manufacturing of pharmaceutical products; and Wholesale and Retail including wholesale and retail trade through the distribution chain as well as marketing of its products. Co. is primarily engaged in production of gynecological, cardiovascular and gastroenterological products, antibiotics, antimicotics, OTC and medicines for treatment of the central nervous system.
Concorde Securities Ltd. is Hungary’s leading independent company engaged in investment banking activities. It provides its clients with integrated financial services, including securities trading, research, corporate financing advisory, capital market transactions, wealth management and investment advisory. The operational management of the company is the responsibility of the CEO, while the owners/managers (who control one-third of the company through their shares and options) are in charge of its strategic governance. Concorde Securities Ltd. is a member of the Budapest, Frankfurt, Warsaw and Bucharest stock exchanges, as well as of the Hungarian Association of Investment Service Providers.
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