- Consolidated revenue € 620.3 million, + 6.8%.
- Operating income € 132.4 million, + 2.7%.
- Net income € 93.1 million, + 1.2%.
- Net financial position*: net debt of € 44.6 million.
- Start of phase III clinical trials concerning REC 0482 (NX-1207), an innovative BPH treatment.
- Six OTC products acquired in Germany
- Acquisition of Farma-Projekt and a portfolio of products in Poland
- Subsequent events: Agreement signed for the acquisition of a portfolio of OTC products in Russia
- Interim 2012 dividend of € 0.20 per share to be distributed.
Milan, 25 October 2012 – The Board of Directors of Recordati S.p.A. approved the Group’s consolidated results for the first nine months 2012 prepared in accordance with International Accounting Standards and International Financial Reporting Standards (IAS/IFRS) and in particular as per IAS 34 requirements for interim reporting. These financial statements will be available today at the company’s offices and on the company’s website: http://www.recordati.com/rec_en/investors/reports/ and can also be viewed on the website of Borsa Italiana S.p.A.
- Consolidated revenue in the first nine months 2012 is € 620.3 million, up by 6.8% compared to the same period of the preceding year. International sales grow by 11.0%.
- Operating income, at 21.3% of sales, is € 132.4 million, an increase of 2.7% over the same period of the preceding year.
- Net income at 15.0% of sales is € 93.1 million, an increase of 1.2% over the first nine months of 2011.
- Net financial position* at 30 September 2012 records a net debt of € 44.6 million. During the period € 21.0 million were paid for the acquisition of six OTC products in Germany, € 14.3 million overall were paid for the acquisitions in Poland of the pharmaceutical company Farma-Projekt plus a portfolio of products and dividends for a total of € 21.3 million were distributed. Shareholders’ equity increases to € 674.9 million.
* Cash and short-term financial investments net of bank overdrafts and medium/long-term loans which include the measurement at fair value of hedging derivatives (fair value hedge).
Business development news
In February the activities for the preparation of a European Phase III clinical trial for REC 0482 (NX-1207), following the successful completion of a Scientific Advice meeting with the European Medicines Agency (EMA) were initiated. The pivotal controlled clinical trial will assess the efficacy and safety of a single TRUS-guided intraprostatic injection of the drug in patients with lower urinary tract symptoms (LUTS) associated with BPH not adequately controlled by medical therapy. A European licensing agreement for the development and commercialization of NX-1207 was signed in 2010 by Recordati and Nymox Pharmaceutical Corporation. Under the terms of the agreement Recordati received exclusive rights to develop and subsequently market and sell the drug in Europe including Russia and the CIS, the Middle East, South Africa and the Maghreb area of North Africa.
During April the marketing authorizations, the trademarks and additional assets concerning six OTC pharmaceuticals for Germany were acquired from Cilag GmbH International and McNeil GmbH & Co. oHG. The products acquired are JHP-Rödler® (mint oil indicated for digestive disorder, headache, cough and cold), Betadorm® D (diphenhydramine HCl indicated for sleep disorders), Rhinopront® (pseudoephedrine+triprolidine indicated for rhinitis and head colds), Collomack® Topical (salicylic acid solution, an anti-corn preparation), Tirgon® (bisacodyl for constipation) and Xitix® (vitamin C lozenges to treat vitamin C deficiency). Estimated 2012 sales for the six products are of around € 6 million.
In August he acquisition of 100% of the share capital of Farma-Projekt Sp. z o.o., a Polish pharmaceutical company with headquarters in Krakow, was successfully concluded. The value of the transaction (enterprise value) is of PLN 71.0 million (approx. € 17.4 million) of which PLN 50.8 million (approx. € 12.5 million) were paid at the closing. Of the remaining balance a portion will be paid in tranches on future dates and a portion comprises the company’s debt. Farma-Projekt operates on the Polish pharmaceutical market since 2003 and markets drugs belonging to a variety of therapeutic areas, mainly cardiovascular and urological treatments as well as dietary supplements. The company employs around 135 personnel, of which 84 are dedicated to sales and marketing. Sales in 2011 were of around PLN 47 million (approx. € 11.5 million).
Subsequent events and business outlook
In October the agreements covering the acquisition of all rights to five product lines on the Russian and CIS market: Alfavit, Qudesan, Vetoron, Focus and Carnitone, were signed. The value of the transaction, which will be funded from existing liquidity, is of RUB 2.7 billion (approx. € 67.2 million). The closing of the operation, expected to take place before year-end, is subject to certain conditions. The brands of the products acquired, which are OTC pharmaceuticals and dietary supplements, are very well known in Russia. Total annual sales of the five product lines are of around RUB 1.0 billion (approx. € 24.9 million). Recordati will also enter into cooperation agreements with Akvion group to continue manufacturing the acquired products and for commercial development.
The group’s business performance was in line with expectations during October. For the full year 2012 we confirm our expectations to achieve revenues between € 810 and € 830 million, operating income between € 160 and € 170 million and net income between € 115 and € 120 million.
The Board of Directors resolved to distribute an interim dividend relating to the financial year 2012 amounting to € 0.20 (before withholding tax) on each outstanding share, excluding shares in treasury stock. The interim dividend will be paid, through the authorised intermediaries, as from November 22, 2012 on coupon No. 10 to be presented on November 19, 2012.
The Independent Auditor’s opinion on the distribution of the interim dividend is also available at the Company’s registered offices as per article 2433-bis of the Italian Civil Code.
The Directors’ Report and financial statements of Recordati S.p.A. as at 30 June 2012, on which the Board of Directors based its resolution to distribute the abovementioned interim dividend, are available at the Company’s registered offices and published on the Company’s website (www.recordati.com). Such documents may also be viewed on Borsa Italiana S.p.A.’s website.
Recordati will be hosting a conference call today 25 October at 4.00 pm Italian time (3.00 pm London time, 10.00 am New York time). The dial-in numbers are:
||+39 02 8058811, toll free 800 213 858
||+44 1 212818003, toll free 800 0156384
||+1 718 7058794, toll free 855 2656959
||+49 65 255114451
Callers are invited to dial-in 10 minutes before conference time. If conference operator assistance is required during the connection please digit * followed by 0 or call +39 02 8061371. A recording of the conference call will be placed on the website www.recordati.com.
A set of slides which will be referred to during the call will be available on our website www.recordati.com under Investors/Company Presentations.
Recordati, established in 1926, is a European pharmaceutical group, listed on the Italian Stock Exchange (Reuters RECI.MI, Bloomberg REC IM, ISIN IT 0003828271), with a total staff of over 3,200, dedicated to the research, development, manufacturing and marketing of pharmaceuticals. Headquartered in Milan, Italy, Recordati has operations in the main European countries, in Central and Eastern Europe, and in Turkey. A field force of around 1,700 medical representatives promotes a wide range of innovative pharmaceuticals, both proprietary and under license, in a number of therapeutic areas including a specialized business dedicated to treatments for rare diseases. Recordati is a partner of choice for new product licenses from companies which do not have a European presence. Recordati is committed to the research and development of new drug entities within the cardiovascular and urogenital therapeutic areas and of treatments for rare diseases. Consolidated revenue for 2011 was € 762.0 million, operating income was € 163.5 million and net income was € 116.4 million.
For further information:
Recordati website: www.recordati.com
Statements contained in this release, other than historical facts, are "forward-looking statements" (as such term is defined in the Private Securities Litigation Reform Act of 1995). These statements are based on currently available information, on current best estimates, and on assumptions believed to be reasonable. This information, these estimates and assumptions may prove to be incomplete or erroneous, and involve numerous risks and uncertainties, beyond the Company’s control. Hence, actual results may differ materially from those expressed or implied by such forward-looking statements. All mentions and descriptions of Recordati products are intended solely as information on the general nature of the company’s activities and are not intended to indicate the advisability of administering any product in any particular instance.
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