Richter's Turnover Down, Profit Up

The consolidated sales revenue of the pharmaceutical company Gedeon Richter Plc. was HUF 203.4 billion in the first quarter of 2024, 3.0% lower than a year earlier, the pharmaceutical company announced on the website of the Budapest Stock Exchange (BSE) on Tuesday. Analysts had expected revenues to fall 3.6% to HUF 202 billion.

In the quarter, the company posted a 75.6% increase in profit after tax to HUF 68.5 billion, compared to analyst consensus of HUF 57.8 billion.

The report points out that a significant foreign exchange gain of HUF 15.2 billion – mostly unrealized – boosted profit after tax in the first quarter of 2024, compared with a large foreign exchange loss a year ago, due to the weaker forint at the end of the period.

The significant increase in profit after tax was due to higher operating profit and a financial result that turned from a foreign exchange loss last year into a profit this year, they said.

The report said they were not changing their previous forecast: after an outstanding year last year, double-digit growth in pharmaceuticals should be achievable again this year after removing the impact of exchange rates. Pharma revenue is expected to be around EUR 2.15-2.25 billion in 2024.

Pharmaceutical revenues reached HUF 200.1 billion in the first quarter, up 12.6% year-on-year, with revenue up in all major markets. The women's pharmaceuticals business again achieved significant volume growth. Total sales in this area rose by 17% to HUF 74.2 billion.

Biotechnology revenues jumped strongly in the first quarter, up 46% to HUF 11.4 billion. The business unit's gross profit almost tripled year-on-year, which, together with milestone revenues, offset a significant increase in R&D spending, they said.

The company's annual general meeting approved the payment of a dividend of HUF 78.8 billion, approximately HUF 423 per share, from 2023 net profit, which is expected to be paid in the second quarter of 2024, they said. Richter shares are traded in the premium category of BSE. Last year, the highest price was 9965 forints and the lowest was HUF 8,010, and the paper price was unchanged on Monday, closing at HUF 9,650.