Highlights:

Strong financial performance

• Core Group revenue up 6%, reflecting growth in all three businesses
• Core operating profit up 11%, driven by strong growth in profit of Generics and Injectables
• Strong cashflow from operating activities of $464 million, whilst maintaining higher inventory levels to ensure continuity of supply during the COVID-19 pandemic
• Continued investment in R&D of 6% of revenue, with growing pipeline of complex products
• Healthy balance sheet, with net debt[4] of $605 million and low leverage at 0.9x net debt to core EBITDA^[5]
• Full year dividend of 50 cents per share, up from 44 cents per share in 2019

Ongoing strategic progress

• Leveraged our strong foundation to meet increased demand for essential medicines used in the treatment of COVID-19, whilst continuing to maintain supply across our broader portfolio
• Continued to expand our portfolio of differentiated products – launched 154 new products across our markets, including icosapent ethyl capsules
• Received US FDA approval for generic Advair Diskus^® and expect to resume launch as soon as the US FDA completes their priority review of the outstanding Prior Approval Supplement (PAS)
• Focused on building a culture of progress and belonging that engages and enables our employees

Continued momentum, with growth in all three businesses

• Injectables: Achieved double digit core operating profit growth reflecting the breadth of our product portfolio and the quality and flexibility of our manufacturing facilities
• Generics: Delivered significant improvement in core operating margin, driven by the strength of new launches, a good performance from in-market products, process efficiencies and our enhanced focus on customer service levels
• Branded: Achieved good growth in revenue, with a strong recovery in Algeria, while core operating profit declined due to the negative impact of foreign exchange

2021 outlook

• Injectables revenue growth in the mid-single digits, with core operating margin in the range of 37% to 38%
• Generics revenue in the range of $770 million to $810 million and core operating margin of around 20%
• Branded revenue expected to grow in the mid-single digits in constant currency

Siggi Olafsson, Chief Executive Officer of Hikma, said: 

“Thanks to our strong foundation, flexible and high-quality manufacturing capabilities, robust supply chain and the unwavering dedication of our people to our purpose, Hikma was able to play a critical role in the pandemic. We responded rapidly to the changing needs of healthcare providers, supplying essential medicines used to treat COVID-19 patients, while continuing to provide the critical medicines our patients need every day.

Our response to the pandemic demonstrates the resilience of our business, which enabled us to deliver a strong financial performance and continued progress against our longer-term strategic objectives. We achieved good revenue growth in all our businesses and an improvement in core profitability. We expanded our portfolio with successful new launches and new partnership agreements, enhanced our manufacturing capabilities and continued to focus on the development of a more diverse, energised and engaged workforce.  These achievements leave us well positioned for future growth and we look forward to continued success in 2021.”   

[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 5 of the Group consolidated financial statements. Core results are a non-IFRS measure and a reconciliation to reported IFRS measures is provided on page 12

[2] Constant currency numbers in 2020 represent reported 2020 numbers translated using 2019 exchange rates, excluding price increases in the business resulting from the devaluation of currencies and excluding the impact from hyperinflation accounting. In 2020 Lebanon and Sudan were considered hyperinflationary economies, therefore the spot exchange rate as at 31 December 2020 was used to translate the results of these operations into US dollars

[3] In June 2020, Hikma purchased 12.8 million ordinary shares from Boehringer Ingelheim, which are being held in treasury. Earnings per share is calculated using the weighted average number of shares outstanding during the period. Dividend per share is calculated using the number of shares in issue at 31 December 2020.

[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 13 for a reconciliation of Group net debt to reported IFRS figures

[5] Core 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