Aspen Pharmacare Holdings says its mixed performance reflects a transitional period, buoyed by strong commercial pharmaceuticals growth that offset a cancelled contract and costly factory restructuring.
Despite a 13% decline in group normalised earnings before interest, taxes, depreciation, and amortisation (ebidta) to R5.05bn, with profit falling 38% to R1.47bn and EPS dropping 194.8cps, the multinational pharmaceutical company’s commercial pharmaceuticals segment posted 4% revenue growth and 11% ebidta growth, highlighting operational resilience.
Group losses were influenced by a R695m overhaul of its sterile finished dose form (FDF) manufacturing facilities in South Africa and France, the benefits of which the group expects to deliver operational improvements and a reshaped manufacturing footprint.
Additionally, the group said its comparative performance was affected by a high baseline in the year before, which included R1.5bn from a cancelled mRNA manufacturing contract that pushed normalised group ebidta to R5.8bn.
Second-half ebidta last year fell to R3.8bn after R500m of that contribution was reversed due to a contractual dispute, later settled in October 2025 with €25m paid to Aspen.
Manufacturing posted a positive ebidta of R208m, even though this represents an 85% decline from the period last year. The group said it is hopeful that ongoing restructuring will deliver stronger results in H2 2026 and be fully realised by FY 2027.
Aspen’s Commercial Pharmaceuticals segment showed strong momentum, posting R21.09bn in revenue and normalised ebidta of R4.85bn, driven by high South African demand for its weight-loss medication Mounjaro and improved profitability from its reshaped business in China.
Additionally, free cash flow, excluding dividends, ended at almost R2bn, supported by an operating cash conversion rate of 193% and a working capital-to-revenue ratio of 45%, alongside lower capital expenditure compared with the prior period.
Stronger cash flow and favourable rand conversion rates also helped reduce net debt to R28.6bn from R31.2bn in June 2025, with a leverage ratio of 3.4x.
Meanwhile, the group’s announced divestment of its Asia-Pacific (APAC) business for AUD2.37bn, with net assets of R21.8bn classified as held-for-sale, is expected to be completed by the end of May 2026, pending shareholder approval.
TimesLIVE
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