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Hikma Pharmaceuticals FY'17 earnings down 9%

Hikma Pharmaceuticals PLC said earnings for the year ending Dec. 31, 2017, fell 9%, and the company forecast 2018 revenues for generics and injectables.

Core profit attributable to shareholders was $252 million, or $1.046 per share, compared to $276 million or $1.179 per share in 2016.

The S&P Capital IQ consensus normalized EPS estimate for 2017 is 94 cents.

On a reported basis, loss attributable to shareholders was $843 million, compared to a profit of $155 million in 2016.

Core revenue for 2017 was down 1% to $1.94 billion from $1.95 billion for the same period a year ago.

Intense pricing pressure in the U.S. plus the delay in approval for its generic version of GlaxoSmithKline PLC's blockbuster asthma treatment Advair Diskus had a material impact on the company's generics business, Executive Chairman Said Darwazah said.

The U.S. Food and Drug Administration recently upheld its 2017 rejection of Hikma's application for generic Advair. Based on an analysis and valuation of its generic Advair, Hikma said it recorded a total impairment charge of $168 million in the second half of 2017.

Hikma also expects 2018 revenues for generics to be in the range of $550 million to $600 million and the core generics operating margin in the low single digits, before adjustments related to the 2017 impairment. The company said it plans to offset continuing price erosion in its generic business by pursuing new commercial opportunities and focusing on the execution of its pipeline.

The London-based drugmaker expects 2018 revenue from injectables to be in the range of $750 million to $800 million, with growth in the Middle East and North Africa region offsetting increased competition in the U.S.

Hikma was affected by the recent U.S. tax reform, incurring a tax expense of $101 million, up from $52 million in 2016. This was mainly due to a $49 million write-down to its U.S. deferred tax asset.