• Tuesday, June 25, 2024
businessday logo

BusinessDay

Nigeria’s largest drug makers profit rises by 76% in 2021 on rising sales

Nigeria’s largest drug makers profit rises by 76% in 2021 on rising sales

Nigeria’s largest publicly listed pharmaceutical companies have recorded a significant boost in profits and revenues as an increase in the demand for prescription drugs and other medical interventions rose on heightened health consciousness amid the COVID-19 pandemic.

Businessday analysed the financials of six drug makers listed on the Nigerian Stock Exchange (NSE), showing a 76 percent uptick in profit to N4.72 billion in 2021 from N2.68 billion in the previous year.

The surveyed drugmakers include Fidson Healthcare plc, May & Baker Nigeria plc, GlaxoSmithKline Consumer Nigeria plc, Morison Industries plc, Pharma-deko plc, and Neimeth International Pharmaceuticals Plc.

Drugmakers in Nigeria have in the past struggled to stay afloat as they battled with a challenging macroeconomic environment, scarcity of foreign exchange to import raw materials, as well as the negative effects of drug smuggling.

However, the tides are turning.

In terms of sales and turnover, the year 2021 has been a great year for the drugmakers given the growing demand for vaccines, pain relievers, antibiotics, and other pharmaceutical products in light of the COVID-19 pandemic.

The pandemic has largely boosted sales for most of these drugmakers as Nigerians are buying more immune boosters and other drugs thought to protect against the virus.

The combined revenue of the drug makers amounted to N68.84 billion in 2021, surpassing the previously recorded N52.40 billion in 2020.

drug maker's revenue
The combined revenue of the drug makers amounted to N68.84 billion in 2021,

Fidson Healthcare

Fidson profit surged to N3.08 billion, a massive 156 percent compared to N1.21 billion in the corresponding period last year. Revenue jumped 68 percent to N30.74 billion from N18.28 billion in the previous year.

Cost of sales stood at N15.75 billion, a 62 percent increase compared to N9.70 billion in the previous year. Administrative expenses soared to N6.42 billion from N3.73 billion.

Selling and distribution expenses increased to N3.42 billion compared to N2.1 billion in the previous year.

Finance costs reduced to N1.26 billion in full-year 2021 from N1.33 billion in the period under review. Finance income surged to N77.7 million compared to N9.24 million.

Total assets grew 23 percent to N33.46 billion compared to N27.24 billion in the period under review.

Net cash utilised by investing activities recorded N3.09 billion from N1.81 billion year-on-year loss. Net cash utilised by financing activities recorded a loss of N4.28 billion in 2021 compared to N2.45 billion in 2020.

Personnel costs increased to N2.03 billion compared to N1.53 billion.

May & Baker

Profit after tax rose to N0.98 billion in 2021, a slight 2.08percent increase from N0.96 billion in the same period in the previous year. Revenue increased by 26.7 percent to N12 billion compared to N9.4 billion in the previous year ended.

The pharmaceutical company was able to cut down cost of sales by just 7 percent less than N413.3 million in December 2020 to N383.7 million in December 2021. Administrative expenses rose to N96.8 million from N52 million in the comparable periods.

Distribution, sales and marketing expenses increased to N1.82 billion from N1.45 billion.

Total Assets grew to N17.2 billion in the fourth quarter, year on year by just 20 percent from N14.3 billion in the preceding year.

Net cash from investing activities recorded a loss year on year of N311.9 million from N449 million in 2020. Net cash flow from financing activities dipped 45 percent to N1.7 billion from N3.1 billion in the previous year.

GSK

Profit dipped 17.7 percent to N0.51 billion compared to N0.62 billion in the comparable period. Revenue increased to N22.4 billion compared to N21.3 billion in the period under review.

Cost of sales increased to N16.42 billion compared to N15.4 billion in the period under review. Administrative expenses surged to N2 billion from N1.6 billion in the comparable period.

Selling and distribution costs stood at N3.54 billion compared to N3.52 billion in the previous year. Finance costs dropped to N4.67 million from N39 million in the period under review.

Total assets rose to N27.2 billion compared to N23.7 billion in the year-ago period.

Net cash flows generated by investing activities recorded a year-on-year loss of N83.54 billion from N245.7 billion in the period under review. Net cash flows used in financing activities recorded N588.1 billion from N367.4 billion year-on-year loss.

Payroll costs dipped to N1.04 billion compared to N1.06 billion in the previous year.

Neimeth

Neimeth’s financial books recorded N0.27 billion profit in September 2021, a 28.5 percent increase from N0.21 billion in September 2020. Its financial year ends in September with a Revenue surge to N3.05 billion from N2.84 in the comparable periods.

The cost of sales increased to N1.60 billion from N1.33 billion in the period under review.

The company’s administrative expenses rose to N514 billion in September 2021 from N452.3 billion in September 2020. Marketing and distribution expenses increased to N579.7 million compared to N505.1 million in the previous year.

Finance costs dipped to N188.2 million compared to N212.7 million in the period under review.

Net cash used in investing activities recorded a year-on-year loss of N339.2 million from N564 million in the comparable period. Net cash used in financing activities recorded a loss of N640.06 billion from N2.82 billion in the period under review.

Employee cost increased to N205.4 million from N196.8 million in the comparable periods.

Read also: Neimeth grows full-year profit by 27%

Morison Industries

Morison industries, in its latest financial books, recorded a loss year on year of N0.79 billion in 2021 compared to N0.1 billion in the previous year. Revenue increased by 16 percent to N0.14 billion from N0.12 billion in the period under review.

Cost of sales stood at N0.11 billion in 2020 and 2021, while office expenses increased by 60.6 percent to N14.2 million compared to N8.84 million in the comparable periods.

Distribution expenses rose to N25 million in 2021 from N21.4 million in the year-ago period. Finance expenses stood at N15.1 million compared to N5.5 million in the previous year.

Total assets rose to N1.62 billion from N388.7 million in the period under review.

Net cash flow from investing activities recorded N1.21 billion from N8.2 million year-on-year loss. Net cash flow from financing activities rose to N1.24 billion in December 2021 compared to N52.8 million in December 2020.

Morison increased staff salaries and wages to N36.9 million compared to N24.8 million in the comparable periods.

Pharma Deko

Pharma Deko, in its latest financial books showed a loss year on year of N0.13 billion compared to N0.32 billion in 2020. Revenue surged 10.8 percent to N0.51 billion compared to N0.46 billion in the comparable period.

Cost of sales stood at N0.41 billion from N0.4 billion in the year ago period. The company reduced its administrative expenses to N212 million in December 2021 from N315 million in December 2020.

Pharma Deko was able to cut down its selling and distribution expenses to N32.8 million compared to N67.3 million in the previous year.

Finance cost increased to N2.8 million in December 2021 compared to N2.2 million in December 2020. Total assets dipped to N1.8 billion compared to N2 billion in the previous year.

Net cash from financing activities increased to N4.6 million compared to the loss of N1.6 million in the period under review.

Employee’s benefits dropped to N197.8 million compared to N200 million in the period under review.