HUDDINGE, Sweden, July 22, 2021 /PRNewswire/ -- April – June
- Revenues amounted to MSEK 747.9 (688.9), corresponding to an
increase of +9% for the period.
- The organic growth[1] during the second quarter
was +8%. The currency impact in the quarter was 0% while the
acquisitions of the product portfolios Pevaryl® from
Johnson & Johnson and Flux®, Decubal®,
Apobase®, Lactocare® from Teva generated
growth of +1%.
- EBIT (Operating Profit) amounted to MSEK 31.0 (98.6),
corresponding to a decline of 69%.
- EBITDA1 amounted to MSEK 180.7 (226.1) corresponding
to a decline of 20%.
- The gross margin, defined as gross profit divided by revenues,
was 56.3% (60.8%) for the quarter. The margin was affected
negatively by product mix.
- Cash flow from operating activities amounted to MSEK 137.9
(171.0).
- Earnings per share was SEK -0.10
(0.11), before and after dilution.
[1] Alternative Performance Measures (APM), note
4 for further information.
Comments by CEO Christoffer
Lorenzen
The second quarter of 2021 finished with a revenue growth of 9%
compared to the year prior, an improvement versus the first quarter
that realized a negative revenue growth of -10%. The organic growth
came in at 8% but total growth was helped by the acquisitions of
Pevaryl® from Johnson & Johnson and the portfolio of
Nordic consumer healthcare brands from Teva. The organic growth
reflects, in part, that last year's sales in comparable months was
negatively impacted by COVID-19 lockdowns. It also reflects that
consumer traffic into physical channels (pharmacies, drug stores
and convenience stores) is increasing. The business, however,
continues to be impacted by COVID-19 and reduced infection rates
and doctor's visits as compared to pre-COVID-19 levels. This
continues to impact the business, notably the Specialty products
and the Pain, Cough & Cold categories.
We continue to develop Karo Pharma in line with our
strategy:
- We have now completed most of the investments into the
operating platform required to support an internationalizing and
growing business. We recently completed the roll-out of our ERP
system and now have a single, streamlined, state-of-the-art
financial system. We have also completed systems implementations in
supply and operations planning and regulatory that digitize and
scale operations. We will continue to invest to develop and improve
our operating platform, however, we shift focus to incremental
improvements of the platform and to investments to support our
commercial functions.
- In terms of M&A we have progressed all integration
projects and are tracking to plan. The Proct® and Teva
portfolios are already fully integrated. The Pevaryl®
portfolio transfer and integration are progressing and will be
completed in Q3. We have also completed the carve-out of the
Hospital Supply business and on July
1 we announced a further divestment of a portfolio of 12
brands to Evolan Pharma. The divestment to Evolan marks the
completion of a portfolio optimization and restructure project, in
which non-core businesses and brands have been divested.
- In terms of our commercial footprint, the business outside of
Scandinavia grew 24% in the first 6 months and now constitutes 47%
of Karo's business versus 37% same period last year. The Italian
market is the latest addition to Karo's directly served markets and
we now have a core commercial team staffed and are executing on a
clear go-to-market strategy with a rented sales force, which
provides improved access to Italian pharmacies.
- We are accelerating the build-up of our e-commerce and digital
team and capabilities. In Q2 we on-boarded a new Head of digital
marketing and e-commerce, Fredrik Thorsén, who is a member of the
Corporate Management Team. Fredrik brings strong experience from
the world of e-commerce and international consumer brands marketing
to Karo Pharma. Most recently he spent 12 years with The Absolute
Company.
The EBITDA for the first half of the year came in at MSEK 440.4,
which corresponds to a growth of 1% compared to the year prior. The
gross margins improved by 1% to 58.6% compared to the year prior
and we have tightly managed the cost base and continue to run a
lean operation. We are gradually increasing our advertising and
promotional spend levels and this, combined with the investments
into e-commerce will be of fundamental importance to drive growth
looking ahead.
Christoffer LorenzenCEO
Significant events after period end
On July 1, 2021, Karo Pharma
closed the divestment of a portfolio consisting of 12 brands to
Evolan. (Citodon®, Morfin Special, Sincon®,
Bamse®, Oliva®, Karbasal®,
Complete®, Nazamer®, Ferromax®,
Tussin®, Samin® and Conotrane®).
The portfolio had a turnover of SEK 62
million in 2020 with a growth of -4% versus the previous
year. The divestment completes the efforts to refine and optimize
Karo's portfolio after the acquisitions done over the last few
years.
Financial calendar
Interim report Jan-Sep
2021
Oct 28, 2021
Year-end report 2021
Feb 16, 2022
The Annual Report 2020 was released March
30, 2021 and the Annual General Meeting was held
April 21, 2021.
Contact
Christoffer Lorenzen, CEO+46 73-501
76 20, christoffer.lorenzen@karopharma.com
Jon Johnsson, CFO, +46 73-507 88 61,
jon.johnsson@karopharma.com
About Karo Pharma
Karo Pharma offers "Smart choices for everyday healthcare". We
own and commercialize reliable original brands within prescription
drugs and over over-the-counter consumer products. Our products are
available in over 60 countries with the core in Europe and the Nordics region. The headquarter
of Karo Pharma is in Stockholm and
the company is listed on Nasdaq Stockholm, Mid
Cap.
This information is information that Karo Pharma AB is obliged
to make public pursuant to the EU Market Abuse Regulation and the
Securities Markets Act. The information was submitted for
publication, through the agency of the contact person set out
above, on July 22, 2021, at 08.00
CET.
This information was brought to you by Cision
http://news.cision.com
https://news.cision.com/karo-pharma/r/interim-report-q2-2021,c3388173
The following files are available for download:
https://mb.cision.com/Main/72/3388173/1447374.pdf
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INTERIM REPORT
JANUARY â€" JUNE 2021 (PDF)
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