Highlights:

Response to COVID-19

• Health and well-being of all employees has been greatest priority through the pandemic
• Supply chain fully maintained, providing our customers with critical drugs
• Manufacturing sites remained open with operations enhanced to support increase in demand

Financial highlights

• Core Group revenue up 9%, reflecting growth in all three businesses
• Core operating profit up 15%, driven by a strong performance in Injectables
• Significant increase in cashflow from operating activities to $292 million, up 56%

• Continued investment in R&D with growing pipeline of complex products
• Healthy balance sheet maintained, with net debt of $511 million and low leverage at 0.8x net debt to core EBITDA[4]^,[5]
• Repaid $500 million Eurobond due in April and issued new $500 million Eurobond in July

• Announced interim dividend of 16 cents per share, up from 14 cents per share in H1 2019

Strategic and business highlights

• Injectables: Delivered double digit core revenue growth, driven by increased demand for COVID-19 related products in the US and EU
• Generics: Maintained core operating margin, supported by a better than expected performance from new launches
• Branded: Achieved a strong performance in our tier one MENA markets resulting in 6% growth in core operating profit in constant currency
• 78 new products launched across our markets
• Signed a non-exclusive supply agreement with Gilead Sciences, Inc. to manufacture remdesivir for injection
• Repurchased 12.8 million shares from Boehringer Ingelheim, representing approximately 5.3% of issued share capital

Revised 2020 outlook

• Injectables revenue now expected to be between $950 million and $980 million, with core operating margin in the range of 38% to 40%
• Generics revenue now expected to be in the range of $720 million to $760 million and core operating margin to be around 21% (including assumed launch of generic Advair Diskus^® in H2)
• Branded revenue expected to grow in the mid-single digits in constant currency

Siggi Olafsson, Chief Executive Officer of Hikma, said: 

“We have delivered strong first half results, which are ahead of our initial expectations and reflect good progress in each of our three businesses.  These results are a testament to the steadfast commitment of our people, who are working hard to ensure high quality and affordable medicines are available to patients throughout the COVID-19 pandemic.  Our performance demonstrates the breadth and resilience of our portfolio, as well as the vital role of the generic medicines we supply.  We have a positive outlook for each of our three businesses and look forward to the second half with confidence.”

[1] 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 4. Core results are a non-IFRS measure and a reconciliation to reported IFRS measures is provided on page 13

[2] Constant currency numbers in H1 2020 represent reported H1 2020 numbers re-stated using H1 2019 exchange rates

[3] Earnings per share is calculated using the weighted average number of shares outstanding during the period. Interim dividend per share is calculated using the number of shares in issue at 30 June 2020.

[4] EBITDA is earnings before interest, tax, depreciation, amortisation and impairment charges/reversals. EBITDA is a non-IFRS measure, see page 13 for a reconciliation to reported IFRS results

[5] Calculated using core EBITDA for the twelve months ended 30 June 2020