Olainfarm Group maintains its profit forecast, a short term decline in 9 month sales results

In 2020, the Olainfarm Group continued its ongoing activity in major sales markets. The highest sales in nine months in 2020 was in Latvia, reaching 28 738 thousand EUR, which is 232 thousand EUR or 1% higher than the same period year ago. Latvia sales represent 32% in Group revenues. Sales in Russia for the nine months period in 2020 amount to 20 590 thousand EUR which is a decrease from 2019 due to extra one-off shipment at the end of 2019 for consumption in the first quarter 2020 amounting to 6 million EUR.

“Covid-19 pandemic and restrictions due to it have brought different challenges our way, but we understand how to tackle them, and are committed to reach our growth plans outlined in the company's 5-year strategy. As a long-term investment, we have established a subsidiary in Russia, which allows us to get insights from the medical community and market research so that our efforts are relevant and current to customer needs. I am happy to announce that the new business model in Russia is in place and our team is operating fully,” said Elena Bushberg, Member of the Management Board, CEO of Olainfarm, a part of Olainfarm Group of companies.

During nine months of 2020, the Group’s sales reached EUR 88 893 thousand, which is 10% less than the same period of last year. Gross profit margin in 2020 is 59.2 %, which is 1.9 p.p. drop compared to 61,1 % reached the same period last year.

The Group’s EBITDA figure for nine months 2020 was EUR 18 130 thousand, which is 25 % or EUR 6 089 thousand EUR less than the result of the same period of 2019. EBITDA margin of the Group is 20.4 %. The forecasted full-year profit of the Group remains as reported in 6 month interim statements – EUR 11.2 million.

The Group’s financial position during nine months in 2020 is stable. The Group’s successful operations allowed it to accumulate EUR 29 991 thousand in cash at the end of September 2020. This is a significant precondition to limit the effect of uncertainty within the sales markets as well as allows to safeguard the supply of raw materials maintaining stable operations. Also accumulated cash allows continued financing for fixed asset investments as well as investments into research and development activities linked to completing clinical trials.

In nine months of 2020, four Phase 1 clinical trials (pharmacokinetics and bioavailability) were completed, while one Phase 1 clinical trial was deferred to H1 2021, taking into account the Covid-19 pandemic and following the guidelines issued by the European Medicines Agency in the implementation of clinical trials on 20 March 2020. Four Phase 3 clinical trials are scheduled in 2020. Within the limits and risks associated with the Covid-19 pandemic, the implementation of Phase 3 clinical trials (clinical part) is scheduled to start in 2021.

Condensed Consolidated Statement of Financial Position		Group
		30.09.2020	31.12.2019
		EUR '000	EUR '000
	ASSETS
NON-CURRENT ASSETS
Intangible assets		40 086	38 422
Property, plant and equipment		41 488	42 442
Right-of-use assets		6 854	7 069
Investment property		226	253
Other long-term investments		726	782
	TOTAL NON-CURRENT ASSETS	89 380	88 968
CURRENT ASSETS
Inventories		30 790	28 247
Receivables		22 402	36 225
Cash		29 991	15 230
	TOTAL CURRENT ASSETS	83 183	79 702
TOTAL ASSETS		172 563	168 670
	EQUITY AND LIABILITIES
EQUITY
Share capital		19 719	19 719
Share premium		2 504	2 504
Reserves		(658)	(12)
Retained earnings		105 941	105 298
	TOTAL EQUITY	127 506	127 509
LIABILITIES
Non-current liabilities
Borrowings and lease liabilities		12 068	12 177
Deferred income		3 649	3 194
	Total Non-Current Liabilities	15 717	15 371
Current liabilities
Borrowings and lease liabilities		6 850	9 568
Trade payables and other liabilities		17 283	15 727
Dividends payable		4 507	-
Deferred income		700	495
	Total Current Liabilities	29 340	25 790
	TOTAL LIABILITIES	45 057	41 161
TOTAL EQUITY AND LIABILITIES		172 563	168 670

Consolidated statement of comprehensive income	Group
	M9 2020	M9 2019
	EUR '000	EUR '000
Revenue	88 893	98 774
Cost of goods sold	(36 303)	(38 449)
Gross Profit	52 590	60 325
Selling expense	(19 036)	(22 356)
Administrative expense	(22 457)	(20 467)
Other operating income	1 990	1 577
Other operating expense	(1 796)	(1 262)
Share of (loss) / profit of an associate	(11)	92
Financial income	57	2 093
Financial expense	(6 040)	(703)
Profit Before Tax	5 297	19 299
Corporate income tax	(184)	(100)
Deferred corporate income tax	37	(1)
PROFIT FOR THE REPORTING PERIOD	5 150	19 198
Other comprehensive (loss) / income for the reporting period, net of tax	(646)	271
Total comprehensive income for the reporting period, net of tax	4 504	19 469
Total comprehensive income attributable to:
The equity holders of the Parent Company	4 504	19 469
Non-controlling interests	-	-
Basic and diluted earnings per share, EUR	0.37	1.36

JSC “Olainfarm” is one of the largest companies in the Baltic States with more than 45 years of experience in the production of medicines and chemical pharmaceutical products. JSC “Olainfarm” is ranked as a TOP14 manufacturing company in Central and Eastern Europe. Currently, the products of JSC “Olainfarm” are exported to more than 50 countries, including Russia and other CIS countries, as well as countries of Europe, North America, Asia and Australia. The basic principle of the company’s operations is to produce sustainable healthcare products and services leveraging on manufacturing and commercial expertise.

Additional information:  
Jānis Dubrovskis
Investor Relations Advisor of JSC Olainfarm
Phone: +371 29178878
Email: janis.dubrovskis@olainfarm.com

Attachment

• Olainfarm_Q3_2020_konsolidetais FS_ENG

To view this piece of content from www.globenewswire.com, please give your consent at the top of this page.
To view this piece of content from ml-eu.globenewswire.com, please give your consent at the top of this page.