Hikma Pharmaceuticals PLC (LSE:HIK, OTC:HKMPF) has upgraded its full-year guidance for two out of three of its business segments following “good momentum” in the first half, but lowered annual sales expectations for Injectables, it said in a trading update today.
Riad Mishlawi, chief executive officer of Hikma, said in a statement today: "The good momentum during the first half has continued, enabling us to upgrade full year guidance in two of our three businesses.
“Our Branded business is performing exceptionally well on an underlying basis and our Generics business has seen key products continuing to drive better-than-expected performance.”
The company now expects that the core operating margin for its Branded business will “expand” to about 23% for the full year on the back of “strong performance” in the segment, it said in the statement.
Medicines used to treat chronic illnesses are driving growth across key the Middle East and North African markets, which it said has offset the devaluation of the Egyptian pound and closure of its Sudanese facility.
The pharma group's Generics segments generated stronger-than-expected revenue from the sale of authorised generic sodium oxybate, it said.
Hikma is now expecting annual revenue of US$920 million to US$940 million and a core operating margin of about 20% for its Generics business, up from prior guidance of 30% growth and margins of 18% to 20%, it said.
The pharma group said it is increasingly using spare capacity at the Columbus plant for contract manufacturing of specialty products.
The company is expecting full-year revenue growth and core operating margin in its Injectables business to be “at the lower end of our guidance range of 7% to 9% and 36% to 37%, respectively”, it said.
It said it lowered its guidance for Injectables sales as a result of the closure of its Sudanese manufacturing facility and short-term capacity constraints in the US.
“Overall, the group is making excellent progress and we are on track to deliver very strong earnings growth for the full year," Mishlawi said.
Hikma's share price fell by nearly 4% to 1,845p by mid-morning on Thursday.