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Hikma looking healthy as it upgrades full-year forecasts following strong first half

The FTSE 250 drugmaker had seen its profits lifted by the launch of 37 new products in the six month period

Hikma Pharmaceuticals - Hikma looking healthy as it upgrades full-year forecasts
The firm upgraded revenue guidance for its Injectables and Generics businesses

Hikma Pharmaceuticals PLC (LON:HIK) has raised its full-year expectations after new product launches boosted first-half profits for the generic drugmaker.

For the six months ended 30 June, the FTSE 250 firm reported a core profit attributable to shareholders of US$176mln, 19% higher year-on-year, while core revenues rose 7% to US$1.04bn.

READ: Hikma Pharma repeats guidance as it ‘gets off to good start’ in 2019

The performance had been helped by the launch of 37 new products over the period, Hikma said, while also hiking its interim dividend 17% to US$0.14 per share.

As a result of its strong first half, the company said it now expected full-year revenues from its Injectables business to be between US$870mln-US$900mln, compared to US$850mln-US$900mln in a May trading update, while its Generics business was now forecast to deliver between US$690mln-US$720mln compared to previous estimates of between US$650mln-US$700mln.

“All of our businesses are performing well. We are delivering more from our unique and diversified business model, leading market positions and high-quality operations to drive strong organic growth”, said Siggi Olafsson, Hikema’s chief executive.

The upgrade gave some pep to the shares in early trading on Friday as they jumped 8.1% to 1,990p.

Generics upgrade “positive surprise”

In a note, analysts at Peel Hunt said Hikma’s upgraded forecasts for its Generics division was a “positive surprise”.

However, the broker maintained its ‘hold’ rating and 1,870p price target on the stock, saying that margin pressure on its Injectables business could intensify in the next 12 months if competitor Pfizer Inc (NYSE:PFE) returned to the market, as outages at the US drug giant have been propping up Hikma’s performance.

Quick facts: Hikma Pharmaceuticals Plc

Price: 2015 GBX

AIM:HIK
Market: AIM
Market Cap: £4.88 billion
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