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Consolidated Sales Of Olainfarm In 2018 Exceed 124 Million, Marking The New Record

28-02-2019

Consolidated profit and loss calculation of JSC Olainfarm for 2018 shows that with the sales worth more than 124 million euros the Group has set the new annual sales record. In 2018 the net profit of Olainfarm Group reached 10.3 million euros, which is a reduction of almost 5% compared to the net earnings of 2017. The products of the Group were sold in 54 markets worldwide.

Based upon the annual results, the Board will recommend the shareholders to decide on paying 1.4 million euros in dividends from earnings of 2018, that equals approximately 0.10 euros per share.

In 2018, compared to 2017, the sales volumes have increased by more than 2 million euros or by almost 2% and exceeded 124 million euros. Although the Group failed to achieve the previously announced sales target of 130 million, it has set the new annual sales record. During the last quarter, EBITDA for twelve months has grown significantly, reaching EUR 20.5 million. EBITDA profitability in the past 12 months also reached 17%. Both of these indicators are the highest since the beginning of 2016.

In 2018, the company has managed to reduce its sales costs and grow in almost all major sales markets, except for Russia, where sales fell by 5% due to previously anticipated fluctuations of the Russian ruble. On the other hand, increased presence in both Latvian and Belarusian markets has resulted in a significant increase in sales in both markets. The largest sales growth of 54% was achieved in Belarus, and also in Tajikistan, where sales grew by 32%. Sales in Latvia also grew by 23%, making the home market the second largest in terms of turnover after Russia.

During the 4th quarter of 2018, compared to 4th quarter of 2017, sales of the Company increased by more than 3 million euros or by almost 10%, reaching 34.8 million euros and making this the best quarter in terms of sales in corporate history.

Since 2017, some significant changes have occurred to the sales structure of bestselling products of Olainfarm. Remantadine and PASA were replaced by Meldonium and Memantine, while shares of Noofen and Neiromidin have become comparable.

Despite the growing number of export markets, diversification of sales markets remains one of the main challenges for Olainfarm Group. In 2018, the company also focused on conducting additional researches to ensure the presence of its products in existing sales markets and preparing to open new ones in the future.

Annual meeting of shareholders of JSC Olainfarm, convened on June 5, 2018 approved operating plan of the Group for 2018. According to it, sales of the Group in 2018 are planned to be 130 million euros, but the net profit will reach 11.5 million euros. According to the unaudited report of 2018, during the year 96% of annual sales target and 90% of annual profit target is met.

Condensed Consolidated Statement of Financial Position		Group
		31.12.2018	31.12.2017
		EUR '000	EUR '000
	ASSETS
NON-CURRENT ASSETS
Intangible assets		36 619	37 034
Property, plant and equipment		43 698	41 892
Investment properties		3 492	3 526
Financial assets		985	2 609
	TOTAL NON-CURRENT ASSETS	84 794	85 061
CURRENT ASSETS
Inventories		25 265	24 161
Receivables		34 337	34 049
Cash		2 689	3 158
	TOTAL CURRENT ASSETS	62 291	61 368
TOTAL ASSETS		147 085	146 429

	EQUITY AND LIABILITIES
EQUITY
Share capital		19 719	19 719
Share premium		2 504	2 504
Other components of equity		(224)	(74)
Retained earnings		82 656	75 675
	TOTAL EQUITY	104 655	97 824
LIABILITIES
Non-current liabilities
Borrowings		10 398	15 878
Deferred income		2 756	2 347
	Total Non-Current Liabilities	13 154	18 225
Current liabilities
Borrowings		14 632	14 013
Trade payables and other liabilities		14 260	15 892
Deferred income		384	475
	Total Current Liabilities	29 276	30 380
	TOTAL LIABILITIES	42 430	48 605
TOTAL EQUITY AND LIABILITIES		147 085	146 429

Consolidated statement of comprehensive income	Group		Group
	Q4 2018	Q4 2017	M12 2018	M12 2017
	EUR '000	EUR '000	EUR '000	EUR '000
Net revenue	34 756	31 692	124 261	122 076
Cost of goods sold	(13 626)	(12 380)	(49 430)	(47 231)
Gross Profit	21 130	19 312	74 831	74 845
Selling expense	(10 376)	(11 117)	(37 091)	(38 125)
Administrative expense	(7 251)	(6 781)	(24 366)	(23 653)
Other operating income	999	944	2 946	2 697
Other operating expense	(339)	(967)	(2 799)	(4 427)
Share of profit of an associate	24	43	107	113
Financial income	19	30	76	236
Financial expense	(994)	(395)	(2 788)	(2 299)
Profit Before Tax	3 212	1 069	10 916	9 387
Corporate income tax	(359)	(171)	(609)	(1 977)
Deferred corporate income tax	1	3 293	1	3 379
PROFIT FOR THE REPORTING PERIOD	2 854	4 191	10 308	10 789
Other comprehensive income for the reporting period	(67)	(114)	(150)	(114)
Total comprehensive income for the reporting period	2 787	4 077	10 158	10 675
Total comprehensive income attributable to:
The equity holders of the Parent Company	2 787	4 078	10 158	10 675
Non-controlling interests	-	(1)	-	-

Basic and diluted earnings per share, EUR	0.20	0.30	0.73	0.77

JSC Olainfarm is one of the biggest pharmaceutical companies in Latvia with over 45 years of experience in production of medication and chemical and pharmaceutical products. A basic principle of company's operations is to produce reliable and effective top -quality products for Latvia and the rest of the world. Products made by the Group are being exported to more than 60 countries of the world, including the Baltics, Russia, other CIS, Europe, Asia, North America and Australia.

Information prepared by:

Inga Krūkle
Member of the Board JSC Olainfarm
Ph.: +371 28698449
inga.krukle@olainfarm.com

Attachment

Olainfarm_IV_2018_consolidated FS_ENG