Meda AB (publ) – Interim report, January–September 2010
- Group sales reached SEK 8,561 million (9,918). Currency effects and increased competition for the Astelin and Optivar products are the most important reasons for lower sales compared to last year.
- EBITDA amounted to SEK 3,486 million (3,356), corresponding to a 40.7% margin (33.8).
- EBITDA, excluding a non-recurring effect[1] and currency fluctuations, declined by 1% to SEK 3,327 million (3,356), thus yielding a 35.9% margin (33.8).
- Operating profit amounted to SEK 2,201 million (2,275).
- Profit after tax totaled SEK 1,249 million (1,205).
- Earnings per share reached SEK 4.13 (3.99).
- Cash earnings per share reached SEK 6.04 (6.88).
- Forecast for full-year 2010
"The Meda Group expects to achieve sales of about SEK 11,400 million and an EBITDA (excluding restructuring charges related to the acquisition of Alaven) of about SEK 4,400 million for full-year 2010.”
CEO'S COMMENTS
The third quarter is traditionally Meda’s seasonally weakest period, and this year is no exception. Currency fluctuations also affected sales for the period negatively by SEK 174 million. The effects of generic competition for Astelin and Optivar are also evident. It is gratifying that we have successfully used cost savings to compensate for negative factors, and maintained profitability even in this situation. Going forward, Meda has a lower risk exposure since the portion of sales vulnerable to generic competition is lower. We are also happy to report success with Astepro, the Astelin follow-up product that now has over 50% of the total azelastine market in the US by value.
As planned, organic sales growth has mainly occurred in new growth markets and for OTC products. These products currently account for about 15% and 20% of Group sales, respectively. Sales in new growth markets show double-digit growth, and are particularly strong in the Turkish and Mexican markets. OTC products are a strategic area for Meda, as the trend of self-care is increasing. Meda now has OTC sales of over SEK 2 billion.
In new products, azelastine in combination with fluticasone for the treatment of allergic rhinitis is the most interesting. The combination product has obtained good results in the ongoing Phase-III studies, which are now concluding. We intend to submit a new drug application in major markets as early as next year. In addition, Potiga (ezogabine, known as Retigabine outside the US) is expected to be approved before the end of 2010. Next year we plan to launch several other new drugs, such as Xerese (treatment of cold sores) in the US and Onsolis (treatment of cancer pain) in Europe.
During the period, we made several interesting product acquisitions and a major corporate acquisition in the US – the specialty pharmaceutical company Alaven. The acquisition of Alaven is a consistent step in Meda's growth strategy and significant cost synergies can be achieved. The integration process has begun.
Cash flow remains strong and we have flexibility to make further interesting acquisitions and enter new partnerships.
Anders Lönner
President and CEO
[1] Excluding non-recurring income of SEK 429 million in Q2.
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For more information, contact
Anders Larnholt, Phone: +46 8-630 19 62
VP Corporate Development and Investor Relations +46 709-458 878
The company’s auditors did not review this interim report.
