Adcock Ingram, the Johannesburg-listed drug-maker with operations in South Africa, Ghana, East Africa and Zimbabwe, on Tuesday said the company’s poor profit showing in the six months to March this year was “regrettable and unfortunate.”
The firm said this inadequate performance was attributable to negative market conditions, overhead costs and the protracted hostile product sales mix during the period under review.
“The group was also a target in a protracted contest for shareholder control and…the drawn out and exacting corporate and regulatory processes preoccupied certain key management and they, together with the board of directors (Board), became embroiled by the demands of these events and actions,” Adcock Ingram said in its results presentation.
It was inevitable that there would be economic consequences under such circumstances…the negative
commercial effects of this prolonged distraction…must to a lesser or greater extent, be revealed in the disappointing results, it said.
Stakeholder control problems were at long last fixed towards the end of February this year, when a group of firms under the leadership JSE-listed diversified industrials firm, Bidvest Group, acquired a “material interest” in Adcock Ingram. This prompted the dissolution of the planned offer and scheme of arrangement between Adcock Ingram and Chile’s CFR Pharmaceuticals.
Adcock Ingram said during the period under review gross profit had sagged 13.9 percent to R846 million ($81.8m) from R983 million ($95m) as hostile product sales mix and the weak rand took their toll.
The firm posted a headline loss of R39 million ($3.7m) during the period under review, compared to the R317 million ($30.6m) gain it posted in the previous reporting period.
However, revenues for the rest of Africa operations surged 68 percent over the comparative period.
Ghana sales surged 10.3 percent to R60 million ($5.8m) from R55 million ($5.3m) in the previous comparable period.
In East Africa, sales soared to R21 million ($2m) from R14 million ($1,3m), boosted by the drug-makers spreading out into Uganda and Rwanda and a further product registrations in Tanzania. (VENTURES AFRICA
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