Siggi Olafsson, Chief Executive Officer of Hikma, said: 

“Once again, we have benefited from the resilience of our portfolio and our flexible manufacturing footprint. Our strong performance included solid year-over-year increases in revenue and operating profit, underscoring our ability to generate positive results in challenging market conditions. We are continuing to benefit from investments we have made to build our pipeline of new medicines and our progress in the first half underpins our improved outlook for the full year. Looking ahead, our clear strategy, strong pipeline and agility give us the confidence to drive continued growth and deliver increased value to all our stakeholders.”

Highlights:

Strong first half performance

• Core Group revenue grew 7% driven by a strong performance in Generics and Branded and the resilience of our Injectables business
• Core operating profit grew 9% to $309 million and core operating margin reached 25%
• Generated good cashflow from operating activities of $224 million. The reduction compared to the first half of 2020 reflects the timing of tax payments
• Maintained low leverage with net debt^[4] to core EBITDA^[5] of 9x at 30 June 2021 (31 December 2020 0.9x)

Continued revenue growth in all three businesses

• Generics delivered strong revenue growth and significant margin improvement reflecting good demand for new and recently launched products, a more favourable product mix and lower operating expenses
• Global Injectables revenue grew modestly, following the exceptionally strong performance in H1 2020, reflecting the resilience of our product portfolio. Injectables operating profit declined in line with expectations, primarily due to a shift in product mix
• Branded achieved double digit revenue growth and improved margins, driven by a strong performance across Tier 1 markets

Further progress increasing availability of important medicines

• Resumed launch of generic Advair Diskus^® in April
• Received approval for and launched 8mg Naloxone nasal spray, demonstrating ability to bring complex generic products to customers and patients
• Launched 9 injectable products in the US, with further launches expected in the second half
• Launched our first locally manufactured oral oncology product in Algeria

Improved FY outlook driven by upgraded guidance for Generics

• Injectables – we continue to expect revenue growth in the mid-single digits, with core operating margin in the range of 37% to 38%
• Generics – we now expect revenue to be in the range of $810 million to $830 million and core operating margin to be in the range of 22% to 24%
• Branded – we continue to expect revenue to grow in the mid-single digits in constant currency

[1] Constant currency numbers in H1 2021 represent reported H1 2021 numbers translated using H1 2020 exchange rates, excluding price increases in the business resulting from the devaluation of currencies and excluding the impact from hyperinflation accounting. Lebanon and Sudan are considered hyperinflationary economies, therefore the spot exchange rate as at 30 June 2021 was used to translate the results of these operations into US dollars

[2] In June 2020, Hikma purchased 12.8 million ordinary shares from Boehringer Ingelheim, which are being held in treasury.

^[3] Core results throughout the document are presented to show the underlying performance of the Group, excluding the exceptional items and other adjustments set out in Note 5. Core results are a non-IFRS measure and a reconciliation to reported IFRS measures is provided on page 14

[4] Group net debt is calculated as Group total debt less Group total cash, including restricted cash.  Group net debt is a non-IFRS measure.  See page 15 for a reconciliation of Group net debt to reported IFRS figures

[5] Core EBITDA is earnings before interest, tax, depreciation, amortisation, impairment and exceptional and other items. EBITDA is a non-IFRS measure, see page 15 for a reconciliation to reported IFRS results. For the purposes of the leverage calculation, core EBITDA is calculated for trailing twelve months ended 30 June 2021