Hikma Pharmaceuticals (HIK) Trading Update summary

Financial guidance and outlook

• Revenue is expected to grow 6% to 8% in 2024, with core operating profit guidance maintained at $700m–$730m, reaffirming upgraded guidance and confidence in meeting targets despite typical year-end challenges.

• All three business segments are contributing to growth, supported by new product launches and infrastructure investments.

• No material impact is expected from recent US election results or potential tariff changes due to significant US-based manufacturing.

Divisional performance and product pipeline

• Injectables division continues strong growth, with 10 product launches year-to-date and plans to launch liraglutide after Teva's exclusivity ends in December.

• Xellia acquisition closed in September, with integration progressing on schedule; expected to contribute $20m revenue in 2024 and be earnings-neutral for 12 months, with future growth anticipated post-integration.

• Generics division performance is driven by a broad, differentiated portfolio, recent launches, and increased R&D investment; revenue expected to grow 5% to 7% in 2024.

• Branded business in the Middle East is stable and growing, with leading market position in Saudi Arabia, strong demand in oncology, diabetes, and cardiovascular, and ongoing facility investments.

Contract manufacturing and capacity expansion

• Significant new long-term contract manufacturing agreement signed for Generics, expected to utilize idle capacity and drive future growth, with commercial production expected in 2027 pending FDA approval.

• Contract manufacturing currently represents about 10% of injectables, with plans to double capacity in three years and expand CMO business as new facilities come online.

• Strategic focus on contract manufacturing as a growth pillar, with dedicated teams and new partnerships with innovative companies.