Concorde Securities - Chemical Works of Gedeon Richter Plc (RICHTER) Richter’s Q2/23 clean EBIT lagged behind estimates

Report

Concorde Securities

Attila Vago

Richter’s Q2/23 clean EBIT lagged behind estimates

Richter posted clean EBIT of HUF 40.3bn (-7% YoY) on net sales HUF 203.8bn (+6% YoY)
for Q2/23. Clean EBIT lagged behind by 12% the consensus estimate of HUF 45.6bn (but
it was ahead 4% of our estimate), while net revenue was also slightly higher than
consensus forecast of HUF 199.6bn and our estimate. As a result, clean EBIT (incl. extra
taxes) margin stood at 19.8% compared to consensus estimate of 24.3% and was almost
the same as our estimate of 19.7%.
Richter recorded minor extra income of HUF 0.6bn in Q2/23. The extra tax levied on the
pharmaceutical industry at the end of December 2022 amounted to HUF 9.1bn.Clean net
income came in at HUF 28.1bn (-59% YoY) vs. consensus estimate of HUF 30.6bn and our
estimate of HUF 30bn profit YoY.

08/08/2023 5 EN

Underlying

Chemical Works of Gedeon Richter Plc

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.

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HU0000123096 Budapest Stock Exchange Hungary

Provider

Concorde Securities

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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Analysts

Attila Vago

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Richter’s Q2/23 clean EBIT lagged behind estimates

Guidance unchanged, clean EBIT beat estimates

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Massive Q1 beat on FX gains, guidance reiterated

Encouraging top line with weak profitability, while Mobility outperforms

Consistent growth in Q3, net profit boosted by Spanish network sale

Record net profit in Q3, guidance maintained

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