Pharmaceutical company, Indies Pharma experienced a surge in profits for its just ended 2020 financial year despite the many challenges faced as a result of the global pandemic.

Net profit for the year increased to $199.1 million, representing a 46.3% jump in 2020 when compared to 2019. The Montego Bay-based company managed to slash its administrative and other expenses by $18.4 million this year, thereby contributing to the company’s profitability in 2020.

The cut in admin and other expenses was mainly due to the decline in rent, vehicle expenses, information technology, security and one-off expenses noted in the prior year.  Despite the challenges faced due to COVID-19 pandemic crisis, Indies Pharma achieved revenues of $765.9 million, representing an increase of five percent or 36.5 million over the corresponding period in 2019.

In its fourth-quarter report for the period ended October 2020, Indies Pharma emphasised that the company would have seen a significant growth in its revenues had it not been for the coronavirus pandemic.

Gross profit was up 14% to $525 million

Gross profit for the twelve-month period amounted to $525 million representing a 14.1% or $65 million increase when compared with the similar period in 2019. Similarly, there was an increase of 11.5% or $13 million recorded for the fourth quarter in comparison to the same period in 2019.

Earnings per share for the twelve-month period increased by 50% to $0.15 cents per share compared to $0.10 cents in the prior period of 2019. Additionally, the Indies Pharma stock price closed at $2.69 at the end of the fourth quarter, representing an increase of 79.3% or $1.19 per share since the company’s Junior Market listing on the Jamaica Stock Exchange (JSE).

Shareholders’ equity increased by 14.4% or $98 million when compared to the similar period in the previous year. The reason for this is the revaluation of the company’s asset and an increase in retained earnings for the period.

Long-term liabilities increased to $882 million, which was predominantly due to Indies Pharma attaining a bond, which was used to repay the loan of $398 million used for the purchase of land for the construction of the company’s corporate office in Montego Bay. In addition to the corporate office, the land purchase will also be used to increase its warehousing capacities as well as to fund the development and approval of two new drugs in the United States by the Food and Drugs Administration (FDA).

Liquidity position remains strong

There has also been a decrease in trade payables. Indies Pharma’s liquidity position remains healthy with a current ratio of 22:1, meaning that the company has $22 of current assets for every $1 of current liabilities.

The return on equity for the fourth quarter increased to 26% from 21.5% in the previous quarter. This shows a strong indication of how well Indies Pharma is managing its assets to create profits. The earning per share increased by 50% to $0.15 per share from $0.10 share compared to prior year 12 months.

Indies Pharma co-founder and Executive Director, Vishnu V. Muppuri report that “This shows a strong indication of how well Indies Pharma Jamaica Limited managed during the pandemic crisis. It is poised to deliver consistently better profits to its shareholders.”