Aspen Pharmacare maintains profit forecast

Drugmaker Aspen Pharmacare has maintained its normalised headline profit forecast for its year to end-June, as the Covid-19 pandemic has a mixed effect on the group and continues to generate uncertainty.

Elevated demand for anaesthetics in parts of Europe towards the latter part of the 10-month period to end-April, has offset the expected decline in the Chinese business brought about by the postponement of elective surgeries and less frequent haemodialysis treatment of patients, the group said.

Normalised headline earnings per share (HEPS) from continuing operations in the year to end-June is expected to be higher than the prior year’s R13.50, in line with previous guidance.

Headline earnings per share is a widely used profit measure in SA, stripping out one-off or exceptional items. Continuing operations refers to a practice of excluding the effect of businesses that may have been acquired or disposed of year on year.

“Stockpiling of everyday healthcare products and advanced filling of prescriptions by consumers in response to the Covid-19 pandemic has had a positive impact on the Regional Brands business,” the group said.

“This has led to overstocking in supply channels and in households, which we anticipate will result in decreased demand over the next few months as stock levels equalise.”

In morning trade on Friday, Aspen's share price was up 5.37% to R137.24, putting it on track for its best one-day performance in just over a month.

gernetzkyk@businesslive.co.za