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Olainfarm Demonstrates Consolidated Record Sales, Board Proposes Dividends

on February 28, 2017

Consolidated profit and loss account of JSC Olainfarm for 2016 shows that with the sales of 111.2 million euros, the Group has set the new record sales. Last year the sales grew by 14% compared to 2015. Net profit in 2016 was 10.1 million euros, which is reduction by a third comparing to 2015, when the net profit was as high as 15.3 million. Profit of 2016 was very significantly influenced by provisions for receivables. The total of about 7 million euros were left for provisions.

Board of JSC Olainfarm proposed a dividend of 0.66 euros per share from the profit of Parent company for 2016. Should it be necessary, undistributed profits of other years may also be used. The Board proposes that dividends are paid in three equal installments at the ends of second, third and fourth quarter of 2017 respectively.

“2016 was important for Olainfarm not only because we acquired four new daughter companies, but also with the sales record we achieved as we surpassed the mark of 100 million. In order to raise our targets every year, we have to get stronger every year. Therefore we focus on integrating the daughter companies into our group, expand our product portfolio, strengthen our positions in existing markets and enter the new ones. We also keep searching for new acquisition targets in different pharma related sectors,” says Valerijs Maligins, Chairman of Olainfarm’s Board.

In terms of sales, fourth quarter of 2016 is again by far the best in corporate history. During the fourth quarter of 2016, sales volumes have increased by 27% compared to similar period of 2015 and reached 32.6 million euro. Profit during this quarter reached 2.3 million, which is a reduction by 13% compared to the fourth quarter of 2015. In fourth quarter alone provisions of 2.47 were made.

The biggest sales increase in 2016 was achieved in Uzbekistan, where sales increased by 65%. During 2016, compared to its nine months share of Russia in totals sales grew significantly (from 29% to 34%). This was facilitated by particularly large sales volumes to this country during the fourth quarter. Share of Ukraine has dropped by 3 percentage points during the same period. Shares of other markets have remained relatively unchanged. The biggest sales markets in 2016 were Russia, Latvia, Ukraine and Belarus.

During the reporting period, registration processes of several products has been successfully completed in Estonia, Kyrgyzstan, Azerbaijan, Turkmenistan, Ukraine, Mongolia, Armenia, Turkmenistan and Bosnia and Herzegovina. During the fourth quarter alone registration of ten products in five countries has been completed. Registration processes of a few more products have been started in Turkey.

Annual meeting of shareholders of JSC Olainfarm convened on June 7, 2016 approved operating plan of the Group for 2016. According to it, sales of the Group in 2016 are planned to be 100 million euros, but the net profit will reach 10 million euros. According to this unaudited report for 2016, during this period 111% of annual sales target and 101% of annual profit target is met.

Condensed Consolidated Statement of Financial Position Group
31.12.2016 31.12.2015
EUR ‘000 EUR ‘000
ASSETS
NON-CURRENT ASSETS
Intangible assets 31 859 20 591
Property, plant and equipment 40 946 35 579
Investment properties 2 200
Financial assets 6 244 4 917
TOTAL NON-CURRENT ASSETS 81 249 61 087
CURRENT ASSETS
Inventories 24 135 20 990
Receivables 36 455 30 480
Cash 3 166 5 574
TOTAL CURRENT ASSETS 63 756 57 044
TOTAL ASSETS 145 005 118 131
EQUITY AND LIABILITIES
EQUITY
Share capital 19 719 19 719
Share premium 2 504 2 504
Reserves 322 322
Retained earnings 72 581 65 773
Non-controlling interests 37 30
TOTAL EQUITY 95 163 88 348
LIABILITIES
Non-current liabilities
Borrowings 19 846 8 560
Deferred corporate income tax 2 685 1 947
Deferred income 2 810 2 656
Total Non-Current Liabilities 25 341 13 163
Current liabilities
Borrowings 5 974 4 258
Trade payables and other liabilities 18 034 11 562
Deferred income 493 800
Total Current Liabilities 24 501 16 620
TOTAL LIABILITIES 49 842 29 783
TOTAL EQUITY AND LIABILITIES 145 005 118 131

 

Consolidated statement of comprehensive income Group Group
Q4 2016 Q4 2015 12M 2016 12M 2015
EUR ‘000 EUR ‘000 EUR ‘000 EUR ‘000
Net revenue 32 600 25 531 111 275  97 392
Cost of goods sold (11 233) (8 727) (41 238)  (32 315)
Gross Profit 21 367 16 804 70 037 65 077
Selling expense (12 542) (8 121) (33 882) (28 202)
Administrative expense (5 767) (6 959) (19 346) (18 965)
Other operating income 1 028 2 355 2 951 2 715
Other operating expense (2 776) (297) (9 427) (1 957)
Share of profit of an associate 38 40 65 118
Income from investments in subsidiaries
Financial income 2 103 64 3 457 262
Financial expense (100) (1 196) (307) (1 404)
Profit Before Tax 3 351 2 690 13 548 17 644
Corporate income tax (719) 585 (3 350) (2 110)
Deferred corporate income tax (319) (91) (112) (245)
PROFIT FOR THE REPORTING PERIOD 2 313 3 184 10 086 15 289
Other comprehensive income for the reporting period
Total comprehensive income for the reporting period 2 313 3 184 10 086 15 289
Total comprehensive income attributable to:
The equity holders of the Parent Company 2 315 3 182 10 079 15 281
Non-controlling interests (2) 2 7 8
Basic and diluted earnings per share, EUR 0.16 0.23 0.72 1.08

 

JSC Olainfarm is one of the biggest pharmaceutical companies in Latvia with 45 years of experience in production of medication and chemical and pharmaceutical products. A basic principle of company’s operations is to produce reliable and effective top quality products for Latvia and the rest of the world. Products made by the Group are being exported to more than 40 countries of the world, including the Baltics, Russia, other CIS, Europe, Asia, North America and Australia.

 

Information prepared by
Salvis Lapins
JSC Olainfarm
Member of the Management Board
Rupnicu iela 5, Olaine, Latvia, LV 2114
Phone: +371 6 7013 717
Fax: +371 6 7013 777
E-mail: Salvis.Lapins@olainfarm.lv

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