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MarketScreener Homepage  >  Equities  >  London Stock Exchange  >  Hikma Pharmaceuticals PLC    HIK   GB00B0LCW083


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Hikma Pharmaceuticals : shares jump after improved sales outlook, COVID-19 drug deal

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08/07/2020 | 04:59am EDT

Hikma Pharmaceuticals raised the sales outlook for its two main divisions on Friday after first-half profit topped the London-listed company's expectations, while also announcing a deal to manufacture coronavirus treatment remdesivir.

Its shares jumped 10% to 2,373 pence by 0948 GMT, jolting the stock to the top of the gainers list of London's blue-chip FTSE 100 index.

The company's largest unit, which supplies needle-based drugs primarily to hospitals, posted double-digit growth in revenue, driven by demand for critical medicines to treat patients infected by the new coronavirus in the United States and Europe.

The injectables division will also take on production of U.S. based Gilead's antiviral remdesivir at Hikma's manufacturing facility in Portugal.

Remdesivir has been a front-runner treatment for COVID-19, which has killed more than 800,000 people globally, as one of the first drugs shown to be effective in countering the disease. Several countries have approved, recommended or taken action in support of the drug for patients with the illness.

"Today's deal with Gilead to supply remdesivir highlights Hikma's growing strategic importance as a trusted source of essential medicines," said a research note from Peel Hunt analysts who have a "buy" rating on the stock.

Hikma, founded in Jordan in 1978, said it now expects 2020 revenue from the injectables business of between $950 million and $980 million.

It said this was an increase on its previous expectation, thanks in part to a boost from the Gilead partnership, but didn't say what its previous expectation had been.

Stocking of medicines for intensive care during the pandemic and longer prescriptions from doctors were a key performance driver, especially in the months of March and April, Chief Executive Siggi Olafsson told Reuters.

"We have delivered strong first-half results, which are ahead of our initial expectations," Olafsson said, without saying what those expectations had been.

Hikma also lifted sales guidance for its generics division - which supplies to the United States - to a range of between $720 million and $760 million, versus $700 million to $750 million.

The company makes treatments including anaesthetics, pain medications, sedatives, neuromuscular blocking agents and anti-infectives. Most importantly it also supplies the steroid drug dexamethasone, touted as a treatment for COVID-19 after a UK study showed it reduced death rates by about a third in severely ill, hospitalised patients.

Group core operating profit rose 15% to $284 million and Hikma raised its interim dividend by 2 cents to 16 cents per share.

By Pushkala Aripaka

Stocks mentioned in the article
ChangeLast1st jan.
GILEAD SCIENCES, INC. 0.00% 62.25 Delayed Quote.-4.20%
HIKMA PHARMACEUTICALS PLC 1.14% 2570 Delayed Quote.29.08%
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Financials (USD)
Sales 2020 2 322 M - -
Net income 2020 399 M - -
Net Debt 2020 327 M - -
P/E ratio 2020 19,7x
Yield 2020 1,51%
Capitalization 7 548 M 7 523 M -
EV / Sales 2020 3,39x
EV / Sales 2021 3,07x
Nbr of Employees 8 600
Free-Float 67,6%
Duration : Period :
Hikma Pharmaceuticals PLC Technical Analysis Chart | MarketScreener
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Technical analysis trends HIKMA PHARMACEUTICALS PLC
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 14
Average target price 32,58 $
Last Close Price 32,75 $
Spread / Highest target 19,1%
Spread / Average Target -0,52%
Spread / Lowest Target -44,0%
EPS Revisions
Sigurdur Oli Olafsson Chief Executive Officer & Director
Said Samih Taleb Darwazah Executive Chairman
Henriette Nielsen Executive Vice President-Business Operations
Khalid Walid Hosni Nabilsi Chief Financial Officer
Bryan Hotston Chief Information Officer
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