We are pleased to maintain our guidance for 2013 of around 20% Group revenue growth.
Injectables
Our global Injectables business continues to perform very well, particularly in the US, where excellent growth is being driven by strong demand across our growing product portfolio, pricing improvements and a good performance from recently launched, more differentiated products. We continue to deliver steady growth in Europe and we are achieving stronger sales in key MENA markets. We continue to expect our global Injectables business to achieve low double-digit revenue growth for the full year and to deliver strong profitability.
Branded
We are successfully executing our strategy of shifting our product mix towards higher value products. This has driven a good performance in key markets and has enabled us to achieve overall Branded revenue growth of around 10% in the year to September, in constant currency. Our focus on higher value products, combined with our success in driving operational efficiencies, has improved margins. For the full year, we now expect adjusted operating margin of around 24%, up more than 50 basis points from last year.
We expect to achieve this significant improvement in margin, while reducing our expectations of Branded revenue growth for the full year to around 8% in constant currency, or around 5% on a reported basis. This has resulted largely from our strategic decision to significantly reduce low margin tender sales. Overall, our improving product mix and more efficient operations have strengthened the Branded business and will support an acceleration of growth in 2014.
In September 2013, we took an excellent first step in our strategy of expanding into sub-Saharan African, signing a 50:50 joint venture agreement with MIDROC Pharmaceuticals Limited, a member of Sheikh Mohammed Hussein Al Amoudi’s MIDROC Group, to establish a presence in the Ethiopian pharmaceutical market. The joint venture, called HikmaCure, will establish a local manufacturing facility and will begin marketing and distributing pharmaceutical products in Ethiopia.
Generics
Our Generics business is continuing to benefit from strong doxycycline sales. We remain focused on the remediation of our Eatontown facility and continue to gradually reintroduce products to the market. We still expect to complete the work by the end of this year and our expectations for non-recurring remediation costs and other one-off items remains around $45 million for the full year. Given the continued strength of doxycycline sales, we are raising our full year guidance for this business to revenue of around $260 million, with a reported operating margin above 40%. Looking forward, we have limited visibility on the future contribution of doxycycline but we expect competition to increase.
Financing position
Our financing position remains very strong and will allow us to make further strategic acquisitions and investments, as these opportunities arise.
Said Darwazah, Chief Executive Officer of Hikma said:
“I am very pleased with the performance of the Group. Our Injectables business is delivering an excellent performance and we are encouraged by the significant opportunities the US market continues to offer. In our Branded business, we are delivering meaningful margin improvements through the successful execution of our strategy to focus on higher value products and through our focus on operational efficiencies. Strong sales of doxycycline in our Generics business continue to benefit the Group by enhancing overall cash flows and strengthening our balance sheet.
We are confident that we will meet our guidance for 2013 of around 20% revenue growth. We are performing well, we have strengthened our businesses across the Group and we are very well positioned to deliver a strong performance in 2014.”
Hikma will announce its results for the year ending 31 December 2013 on 12 March 2014.