GRÜNWALD (dpa-AFX) - Business is still flourishing at pharmaceutical manufacturer Dermapharm after nine months. The SDax company benefited from the good performance of its new subsidiary Arkopharma and increased demand for dietary supplements and herbal extracts. Although this led to a strong increase in turnover, the Group was unable to fully compensate for the discontinuation of vaccine production for Mainz-based manufacturer Biontech in terms of earnings. As a result, profitability fell significantly. However, analysts were positively surprised by the results and the share price rose significantly on Wednesday.

In early trading, Dermapharm rose by around three percent to 39.92 euros on the stock exchange, making it one of the favorites in the index of smaller companies. After a prolonged downturn, which began after the high for the year to date of 49.48 euros at the end of August, the share has now returned to the level seen at the end of September. Since the beginning of the year, the share price has risen by a good six percent. However, investors are faced with high price losses of almost 60 percent compared to the record high at the beginning of 2022, when the share price was almost 92 euros.

At that time, vaccine production was still providing a boost for Biontech, but the pandemic has since subsided significantly and people are less willing to be vaccinated. So far this year, Dermapharm has only produced for the Mainz-based company in the first quarter, but is currently holding capacity for Biontech for a certain fee.

Thanks to the acquisition of Arkopharma, the Group has so far filled the sales gap caused by the lack of vaccine production. The French specialist for herbal medicines and dietary supplements came under the Group umbrella last January and is now providing momentum. In addition to the acquisition, Dermapharm also benefited from the "strong growth of our broadly diversified portfolio" in the first nine months, said Group CEO Stefan Feldmeier in Grünwald.

From January to September, turnover rose by 18 percent year-on-year to just under 867 million euros. However, earnings before interest, taxes, depreciation, amortization and special items (adjusted EBITDA), which are decisive for the Group forecast, only rose comparatively slightly by just under two percent to around 244 million euros, as two of the Group's segments are struggling with declining earnings: the branded pharmaceuticals business, which includes vaccine production, and the area for so-called parallel imports - which is suffering from a weak product mix, it said.

Dermapharm operates in the parallel imports segment via Axicorp, which buys original branded medicines at low cost in other EU countries and markets them in Germany.

Across the Group, the adjusted operating margin therefore fell by 4.5 percentage points to 28.1 percent. Dermapharm also had to settle for a bottom-line profit of just under 64 million euros, almost 40 percent less than a year ago.

Jefferies analyst Alexander Thiel nevertheless spoke of "strong figures" from the pharmaceutical manufacturer. The company had surprised even more positively at the earnings level than in terms of turnover. He also referred to earlier statements by the Group that stable earnings could be expected in the coming year despite the lack of Covid income. When asked, Dermapharm said that a concrete forecast would not be available until the beginning of 2024.

The Management Board headed by CEO Feldmeier had already specified its targets for the current year in August. After nine months, they have now been underpinned once again: the upper end of the ranges for revenue and earnings in day-to-day business are to be achieved. The targets are 1.08 to 1.11 billion euros in sales and 300 to 310 million euros in adjusted operating profit./tav/mne/men