OREANDA-NEWS. September 01, 2011. Pharmstandard released a strong set of 1H11 IFRS financials today (31 Aug). Revenue was up 60% YoY in rouble terms to RUB18.5bn, mostly driven by growth in third-party product sales (+146% YoY) while sales of the company’s organic brands rose 14%, reported the press-centre of ATON.

Nevertheless, PHST was able to improve its margins substantially as costs for organic brands were flat YoY despite their sales growth. EBITDA margin reached 29.5% on the back of reduced operating costs as a percentage of revenue while earnings rose an impressive 52%.
 
Bottom line
The margin contraction trend is in line with what the market expects from Pharmstandard, but the velocity of the fall in EBITDA margin is slower than we anticipated. While the news is good, we don’t expect it to move the stock in the current environment.