Feb 18, 2011

Indofarma FY10 net income soars 550%

The state-owned pharmaceutical company PT Indofarma Tbk (INAF) estimates its net income to soar by 550% to Rp13 billion in 2010 compared to the same period in the previous year at around Rp2 billion.
President Director of Indofarma P. Soedibyo said that such profit jump is expected to realize following the improved portfolio and efficiency in 2010.
“Our efforts to foster the profit include improving our portfolio. Our products are categorized into 9 clusters based on the profitability and growth. We limit the production and the sale of products whose margin is less than 12% with the growth only 1%-2%,” he said today.
In the meantime, the revenue projection in 2010 reached around Rp1.1 trillion or relatively equal to the previous year of Rp1.13 trillion, or a slight decline compared to the sale in 2008, amounting Rp1.47 trillion.
Soedibyo explained that the drop was propelled by the declining generic price in 2008-2009 as nearly 90% of its product is categorized as the generic medication. This reality is somehow in line with the public service obligation policy (PSO).
On the other hand, the cost of goods sold of the state run pharmacy company is estimated to slightly decline by 3.4% to Rp793 billion in 2010 and Rp820 billion in 2009.
“Our biggest production is generic medication merely to fulfill our obligation to government. In 2008-2009, there was a decline over the generic medication price and we did not receive any subsidy,” he said.
For Indofarma’s future growth, one of the main challenges is problem over the raw materials of medication that is mainly imported.
Based on the consolidated financial report, the company whose code stock is INAF, suffered Rp31.84 billion net loss along with Rp498.92 billion revenue as per the third quarter of 2010. 

Disclosure: No position at the stock mentioned above.

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