Summary of the 9M/2019 results of Imexpharm Pharma. JSC (IMP VN)
9M/2019 results: highlights
- IMP’s revenue increased by 9.4% y/y. The own products group (+11.3% y/y) made up the bulk (91%) of the company’s overall revenue. Within this group, the two distribution channels hospitals and pharmacies saw different developments. Hospital revenue increased strongly by +68% y/y thanks to higher capacities and a new supportive regulation. Meanwhile, revenue at pharmacies declined by 2% y/y because of the stringent enforcement of Good Pharmacy Practices (GPP).
- The company’s net margin was nearly unchanged and net profit amounted to 110bn, +11.2% y/y.
- IMP’s financial position remained solid with only a modest leverage (D/E of 0.06x).
Outlook
- As for all 2019, we retain our latest estimate that called for a net profit of VND 160bn (9M/2019 achieved 69% of this amount). We expect Q4 hospital sales to continue to grow strongly thanks to new successful biddings to hospitals for the company’s products manufactured in the IMP2 and IMP3 factories.
- Forecasts from 2020 till 2023 are also almost unchanged from our last quarterly review. We believe that IMP can grow its revenue by a CAGR of 13.3%, driven by an increase of 7.0% p.a. for pharmacy sales and by an increase of 27.0% p.a. for hospital sales. During this period, we expect the net profit CAGR to increase by 15.4%, slightly higher than revenue, mainly thanks to lower allocations to the provision fund for technology applications as new factories come into operation.
Recommendation
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