OREANDA-NEWS. On 18 August 2008 OJSC "VEROPHARM" [RTS:VRPH, MICEX:VFRM] announced its unaudited financial results for the 1st Half 2008 in accordance with the International Financial Reporting Standarts (IFRS).

Sales

Consolidated sales in H1 2008 grew by 45,4% and reached USD 86,5 mln. in comparison with USD 59,5 mln. in H1 2007.

The share of Rx drugs sales in H1 2008 increased to 65% as compared to 54% in H1 2007. The share of OTC drugs remained unchanged at 8% as compared to the same period in year before. Adhesive bandages sales share in finished goods decreased from 21% to 20% in H1 2007. Portfolio of traditional drug sales as before demonstrate tendency for a decrease of share in sales – the decrease from 17% to 7%.

Veropharm sales as part of Federal Reimbursement Program (FRP) came to USD 3,3 mln. in H1 2008, accounting for 3,8% of the Company’s total finished goods sales. By the results of H1 2007, FRP sales were USD 2,1 mln., or 3,6% of the Company’s total finished goods sales. Sales of anticancer drug Bilumid through FRP accounted for 80% of the Veropharm total FRP sales in H1 2008.

Sales within the Russian Federation accounted for 96% of the Company’s total finished goods sales in H1 2008.

Profit

In H1 2008 the gross profit of Veropharm increased by 60,3% and reached USD 58,7 mln. compared to USD 36,6 mln in H1 2007. Gross margin increased to 67,9% as compared to 61,5% in H1 2007.

The increase of the gross margin materialized in the following product segments: Rx drugs - from 72,5% to 75,8%; adhesive bandages – from 57,0% to 57,2%; OTC drugs (caused by price increase for the drugs “Xylen” and “Slabilen”) – from 55,8% to 66,6%. The gross margin in the traditional products decreased from 40,1% to 26,0.*

In H1 2008 EBITDA increased by 67,9% as compared to H1 2007 and reached USD 28,6 mln. which makes 33,0% of Company’s total sales. In H1 2007 EBITDA accounted for USD 17,0 mln., or 28,6% of the Company’s total sales.

The H1 2008 net profit grew by 75,9% to USD 19,4 mln. which makes 22,4 % of Company’s total sales (an increase of 3,9 % in comparison with H1 2007).

Debt

As of the end of H1 2008 the debt of OJSC “Veropharm” amounted to USD 18,2 mln. that represents less than 20% of Company’s net assets.

* according to management accounts of OJSC “Veropharm”