OREANDA-NEWS. June 17, 2011. OJSC “VEROPHARM” [RTS:VRPH, MICEX:VFRM] announces its unaudited financial results for the 1st Quarter 2011 in accordance with the International Financial Reporting Standards (IFRS).

Sales

Consolidated sales in 1Q 2011 increased by 43.6% and reached RUR 1,382.9 million (as compared with RUR 962.9 million in 1Q2010).

Group of pharmaceutical products

Rx drugs sales amounted to RUR 962.3 million, a 61.0% increase in comparison with 1Q 2010. The Rx drugs sales accounted for 69.5% of total finished goods sales.[1]

OTC drugs sales amounted to RUR 192.1 million, a 27.9% increase in comparison with 1Q 2010. The share of OTC drugs makes 14% of total finished goods sales.

Traditional drug sales amounted to RUR 6.7 million, which represents a 48.1% decrease as compared to 1Q 2010. The share of traditional drugs in total sales decreased to 0.5%

Group of non-pharmaceutical products

Adhesive bandages and cosmetic products sales came to RUR 221.8 million, a 9.7% increase in comparison with 1Q 2010. The share of adhesive bandages and cosmetic products in total finished goods sales of the Company was 16%.

Veropharm sales as part of the Federal Reimbursement Program (FRP) came to RUR 54.7 million, accounting for 3.8% of the Company’s total finished goods sales. [1]

In 1Q 2011 sales in Russian Federation provide 98% of the Company’s sales. In 1Q 2011 exports accounted for 2% of the Company’s total finished goods sales compared to 4% in 1Q 2010.

Profit

In 1Q 2011 the Gross profit of Veropharm increased by 36.7% and reached RUR 959.4 million compared to RUR 701.8 million in 1Q 2010. Gross margin in 1Q 2011 amounted 69.4%.

Gross margin of segments of OJSC “Veropharm” in 1Q 2011 is the following:

Group of pharmaceutical products

Gross margin of Rx drugs amounted to 69.6% against 77.2% in 1Q 2010;

Gross margin of OTC drugs amounted to 75.9% against 77.2% in 1Q 2010;

Gross margin in the traditional products amounted to 44.8% against 53.5% in 1Q 2010.

Group of non-pharmaceutical products

Gross margin of adhesive bandages and cosmetic products increased and amounted 63.7% against 58.3% in 1Q 2010.

In 1Q 2011 EBITDA increased by 109.1% as compared to 1Q 2010 and reached RUR 415.5 million. EBITDA margin in 1Q 2011 increased to 30.0% against 20.6% in 1Q 2010.

In 1Q 2011 Net profit increased by 179.2% as compared to 1Q 2010 and reached RUR 338.3 million. NI margin in 1Q 2011 increased to 24.5% against 12.6% in 1Q 2010.

Debt

As of the end of 1Q 2011 the debt of OJSC “Veropharm” amounted to RUR 440.9 million that represents less than 20% of Company’s net assets.

[1] – % as percentage of finished goods sales.