Adcock Ingram (AIP) H2 2024 earnings summary

Executive summary

• Revenue grew 6% to ZAR 9.6 billion, with trading profit up 4% to ZAR 1.23 billion and HEPS rising 10% to 617 cents, supported by share buybacks and strong cash generation.

• Dividend per share increased by 10% to 275 cents.

• Defensive portfolio and effective cost control enabled solid trading profit growth, with notable performances in OTC and prescription divisions.

Financial highlights

• Turnover increased by 6% to ZAR 9.6 billion; trading profit up 4.2% to ZAR 1.23 billion.

• Gross margin declined from 34.9% to 33.4% due to weaker exchange rates and sales mix.

• Operating income fell 6.2% to just over ZAR 1 billion, impacted by impairments and non-trading expenses.

• Net cash position of ZAR 89 million at year-end, with access to ZAR 1.75 billion in working capital facilities.

• Headline earnings reached ZAR 930 million, up 3.5% year-over-year.

Outlook and guidance

• Focus on balancing regulated and non-regulated portfolios, operational efficiency, supply chain resilience, and ESG initiatives such as solar energy and electric vehicles.

• Hospital division under review for potential reconfiguration or outsourcing due to operational challenges; update expected by year-end.