Hikma Pharmaceuticals shares soar and lift FTSE 100 despite fall in profits
Hikma Pharmaceuticals was the top gainer on the FTSE 100 today as its profit drop was smaller than expected.
The figures
Hikma's group operating profit stood at $302m (£247.6m), down 21 per cent and down nine per cent in constant currency.
Group revenue hit $1.9bn, up 35 per cent and up 39 per cent in constant currency.
The group proposed a final dividend of 22 cents per share and full year dividend of 33 cents per share, up from 32 cents per share for the full year in 2015.
Group revenue in 2017 is expected to be around $2.2bn in constant currency.
Hikma, which makes and markets branded and non-branded generic and injectable drugs, bought Boehringer Ingelheim's US generic drugs business last year.
Read more: Hikma Pharmaceuticals has cut its full year sales guidance
Why it's interesting
Hikma was the biggest gainer on the FTSE 100 today despite posting a drop in profit.
This is because the fall in profits was far less dramatic that analysts expected. Bloomberg analysts expected profits to drop to $281m. According to Reuters, analysts on average had estimated operating profit of $375m and noted the positive impact of improved margins.
At the time of writing, shares in the company were up 7.21 per cent at 2,279.20p.
[stockChart code="HIK" date="2017-03-15 12:12"]
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What Hikma said
Said Darwazah, chairman and chief executive officer of Hikma, said: "We made significant strategic progress in 2016. The acquisition of West-Ward Columbus is transforming our Generics business and the group as a whole. This is our largest acquisition to date and the integration process has been both challenging and exciting."
We expect the generics business to achieve significant growth in revenue and profitability in the coming years as we focus on pipeline execution and portfolio optimisation.
He added: "Our global injectables business delivered excellent growth in revenue and operating profit in 2016, at the same time as we more than doubled our R&D investment to underpin the long-term growth potential for this business.
"In the MENA, our reported results were impacted by the devaluation of the Egyptian pound in November 2016. However, our strategic focus on higher value products, combined with tight cost control, drove significant growth in operating profit in constant currency and a meaningful margin expansion."