JGL Achieves Record Results in the First Half of the Year

With total consolidated revenue of HRK 406 million, which represents a 15% increase, JGL Group achieved the best semi-annual results in its history. As part of the pharmaceutical core business (JGL Pharma), which does not include the pharmacy part of business or the cosmetics and dietetics segment, we have earned HRK 305 million in operating revenue and recorded an increase of 13%.

JGL Group’s operating revenue (EBITDA) of HRK 46 million has more than doubled in comparison to the end of June 2018, while profit before taxation (EBT) of HRK 26 million is higher by HRK 45 million than in the same period last year.

"We are very pleased with our growth, not only with the double-digit rate, but also with the fact that it has been achieved in a large number of markets and with an extensive product portfolio, thanks to the strong efforts made by all our employees,” says Mislav Vučić, JGL’s CEO.

The highest growth rate in relation to the same period in 2018 was recorded in Ukraine, at 75%, and the positive trend is also noticeable in Bosnia and Herzegovina (+28%), Belarus (+25%) and Serbia (+16%). JGL also continues to grow in its largest markets, that of Russia (+14%) and Croatia, where it’s growing twice as fast as the market of OTC drugs.

JGL’s key growth drivers are still the seawater-based natural products Aqua Maris, a line which has seen an increase of 22% in Russia through the increase in market share and new form launches. We’ve also seen great results with the artificial tear portfolio as part of the Vizol S brand (+50%), and with Meralys sprays, strong decongestants that protect the nasal mucosa (+20%), while the Reflustat product that alleviates heartburn symptoms (+140%) experienced the largest and fastest growth. JGL continues to make great strides in the anti-allergen segment in all markets, both in the area of nasal products and eye products. 

"The results we have achieved over the last 12 months demonstrate a continued growth and improvements of JGL’s business activities. JGL Pharma’s EBITDA margin rate is 17.7%, and our indebtedness factor dropped to 3.0x, which proves that have increased our profitability and liquidity levels, and that we are conducting our business within the financial stability framework,” adds Vučić. 

From 1 January to 30 June 2019, JGL launched a total of 27 new products, primarily in the strategic therapeutic areas of respiratory, ophthalmology and dermatology products, and there were a total of 19 active development products. The most important new partnerships were also concluded in the first half of 2019. 

"In May, we concluded a very important strategic partnership with one of Europe’s largest drug manufacturers, Polpharma, in the area of sharing prescription and OTC medications, transferring the production of preservative-free ophthalmology products to Croatia, and potentially cooperating in the Russian market. Thanks to the cooperation with Polpharma, our products will become available in Poland and other European markets, while part of the Polpharma portfolio will be manufactured at JGL’s facilities in Rijeka and sold in Croatia and other European markets,” says Vučić.

In addition, in the first half of 2019, JGL became an authorised distributor of oral drug formulations for the Medochemie pharmaceutical company on the Croatian market. Cooperation with the renowned manufacturer of generic drugs will significantly contribute to our efforts to further expand our prescription drug portfolio. 

We expect to see a continuation of the double-digit growth trend in the second half of the year, as well as a debt reduction and further reduction of the indebtedness factor (Net debt/EBITDA), in order to explore other areas of the company’s investment potential. 

"With this in mind, and taking into consideration the investment cycle planned for the coming period and the maturity of the existing bond in 2020, as well as current market conditions, we have reached the decision to refinance HRK 130 million in bonds. In any case, we expect that the positive trends listed above will continue through the last two quarters of this year as well,” concludes Vučić. 

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