OREANDA-NEWS. May 23, 2011. OJSC "VEROPHARM" [RTS:VRPH, MICEX:VFRM] announces its audited financial results for the 2010 in accordance with the International Financial Reporting Standards (IFRS).

Sales

Sales in 2010 increased by 23% and reached RUR 5,395.1 mln in comparison with RUR 4,395.2 mln in 2009. The share of product segments in OJSC “Veropharm” sales:

Group of pharmaceutical products

The share of Rx drugs sales in 2010 increased to 70% as compared to 69% in 2009;

The share of OTC drugs increased in 2010 to 13% as compared to 12% in 2009;

Portfolio of traditional drug sales as before demonstrate tendency for a decrease of share in sales – the decrease from 2% to 1%.

Group of non-pharmaceutical products

The share of Adhesive bandages and cosmetic products sales in 2010 amounted 16% against 17% in 2009.

Veropharm sales as part of the Federal Reimbursement Program (FRP) came to RUR 171.4 million in 2010, accounting for 3.2% of the Company’s total finished goods sales. By the results in 2009, FRP sales were RUR 53.2 million, or 1.2% of the Company’s total finished goods sales.

The Russian Federation is the main market and provides 96.3% of the Company's sales. In 2010 exports accounted for 3.7% of the Company’s total finished goods sales compared to 2.5% in 2009.

Profit

In 2010 the gross profit of OJSC “Veropharm” increased by 26% and reached RUR 3,700.3 mln compared to RUR 2,936.1 mln in 2009. Gross margin in 2010 increased by 1.8% and amounted 68.6%. Gross margin of segments in OJSC “Veropharm” the following:

Group of pharmaceutical products

Gross margin of Rx drugs maintain stability and amounted to 70.0% (as on 2009 results);

Gross margin of OTC drugs increased from 66.2% to 75.6%;

Gross margin in the traditional products increased from 29.1% to 54.2%.

Group of non-pharmaceutical products

Gross margin of adhesive bandages and cosmetic products amounted 57.9% against 59.2% in 2009.

In 2010 EBITDA increased by 15% and reached RUR 1,601.1 mln compared to RUR 1,389.0 mln in 2009. EBITDA margin in 2010 amounted to 29.7% against 31.6% in 2009.

The Net profit increased by 9% to RUR 1,206.7 mln. compared to RUR 1,107.6 mln in 2009. NI margin in 2010 amounted to 22.4% against 25.2% in 2009.

Facilities investments

In 2010 the modernization and production facilities’ upgrade of the Company’s core production assets amounted to RUR 170.2 mln, a 116% increase as compared to 2009.

Debt

As of the end of 2010 the debt of OJSC “Veropharm” decreased by 53% and amounted to RUR 464.8 mln that represents less than 20 % of net assets.