Apr 18, 2011

Kalbe Farma sets15%-18% rise in profit

Indonesia's largest pharmaceutical company with 14% market share, PT Kalbe Farma Tbk (KLBF), targets a 15%-18% increase in net income this year, higher than the target of net sales.
 Kalbe Farma Finance Director Vidjongtius said the company's net income is set to rise 15%-18% this year to Rp1.48 trillion-Rp1.52 trillion or Rp155-Rp160 per share from Rp1.29 trillion last year or Rp137 per share.
Net sales is targeted to increase 12%-15% in 2011 to Rp11.46 trillion-Rp11.76 trillion from Rp10.23 trillion last year.
In 2010, Kalbe's net sales grew 12.5% to Rp10.23 trillion from Rp9.09 trillion in the previous year. Gross profit rose 14.5% to Rp5.17 trillion from Rp4.51 trillion, driving higher gross margin to 50.5% from 49.7%.
Operating profit augmented 14.4% to Rp1.79 trillion from Rp1.57 trillion with a slight increase in operating margin to 17.5% from 17.2%. Kalbe Farma sets target of operating profit margin at the range of 17.5%-18.5%. Net income rose 38.5% to Rp1.29 trillion from Rp929 billion.
Acquisition story
Vidjongtius said the company is still looking consumer firm as a target acquisition. "We hope the acquisition would be realized this year. Last year, the acquisition could not fulfilled."
Adding to that, Kalbe Farma is in talks with more than targeted companies. According to him, Kalbe Farma considers the acquisition range at Rp500 billion-Rp1 trillion.
"We have strong internally generated cash flow or Rp1.8 trillion-Rp1.9 trillion. Still, we also manage treasury stocks we bought back from the market during 2007-2009." he said. 
The company has 7.7% stake of 780.99 million treasury shares with market value of approximately Rp2.5 trillion. "We will sell the treasury stocks when we need financing to realize the acquisition," he said.

Disclosure: No position at the stock mentioned above.

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