OREANDA-NEWS. On 18 June 2008 OJSC "Veropharm" announced 2007 financial results in accordance with the International Financial Reporting Standards (audited).

Sales

Consolidated sales in 2007 grew by 38,8% and reached USD 139,5 mln in comparison with USD 100,5 mln. in 2006.

In 2007 sales of finished goods were up by 39.3% in comparison with 2006 USD and amounted USD 137,9 mln.*

The share of Rx drugs sales in 2007 increased to 60% as compared to 53% in   2006. The share of OTC drugs remained unchanged at 8% as compared to year before. Adhesive bandages sales share in finished goods decreased from 21% to 18% in 2007. Portfolio of traditional drug sales also demonstrate tendency for a decrease of share in sales – the decrease from 17% to 14%.*

OJSC "Veropharm" sales in the 2007 FRP program amounted to USD 5,8 mln which makes 4% sales of the Company.*

Profit

In 2007 the gross profit of OJSC "Veropharm" increased by  44,3% and reached USD 86,7 mln compared to USD 60,1 mln in 2006. Gross margin increased to 62,2% as compared to 59,8% in 2006.

The increase of the gross margin materialized in the following product segments: Rx drugs - from 74,1% to 74,6%; OTC drugs (caused by price increase for the drug "Xylen") – from 54,3% to 59,1%. The gross margin in the adhesive bandages decreased from 59,6% to 56,3%; in the traditional products – from 37,4% to 37,2%.*

In 2007 EBITDA increased by 47,3% and reached USD 42,5 mln which makes 30,5% of Company’s sales (in 2006 EBITDA increased by 20,3% and amounted USD 28,9 mln).

The net profit grew by 51% to USD 27,7  mln which makes 19,9 % of Company’s sales  (an increase of 1,6 %  in comparison with 2006).

In 2007 the Company launched the top-management’s motivation program which comprises incentive payments linked to changes in OJSC "Veropharm" shares market price and payable up to June 2011. According to this program in 2007 accruals of USD 0,9 mln were made, which affected profit lines of the Company.

Debt

As of the end of 2007 the debt of OJSC "Veropharm" amounted to USD 20,3 mln that represents less than 20 % of  net assets.

* according to management accounts