25 July 2018 - Deborah Wilkes
Genomma Lab has announced financing worth USD100 million to support its expansion plans, and reported sales up by 6.5% in the second quarter of 2018.
The Mexican company, which is implementing a turnaround programme, said the loans would support debt refinancing and construction of its new manufacturing facility in Mexico.
Chief executive officer Maximo Juda said the OTC plant would begin operations in the fall and the personal care plant would follow in the first half of 2019.
Juda pointed out the new manufacturing plant would enable Genomma to focus on "lowering its production costs and thus offering more affordable medicines and products across the region".
He also noted the company had made "initial progress" in its product innovation programme, which would be "running at full speed by the fourth quarter of 2019".
The International Finance Corporation (IFC), which is a member of the World Bank Group, together with IDB Invest and the Inter-American Development Bank (IDB), both of which are members of the IDB Group, are providing the financing. The IFC has provided a USD50 million loan, while the IDB has given a MXN900 million (USD49 million) loan.
Genomma's financial results
Genomma recorded sales of MXN3.10 billion in the second quarter of 2018, representing a rise of 6.5% compared to the same period a year earlier.
Juda said the "strong sales performance" had been achieved despite "challenging macroeconomic headwinds in Argentina and Brazil".
The company's OTC sales increased by 19.0% to MXN1.48 billion, representing 47.7% of the company's total sales. The rest of Genomma's sales came from personal care products.
OTC sales in Mexico were up by 24.7% to MXN703 million in the second quarter of 2018, while OTC sales in Latin America rose by 15.9% to MXN605 million.
In the US, OTC sales were up by 8.8% to MXN170 million in the second quarter of 2018.
OTC acquisitions in the US
Genomma recently boosted its OTC presence in the US through two separate acquisitions. The company acquired the Bufferin pain reliever from Dr Reddy's Laboratories, and the Cheracol D cough remedy and Rose Milk personal care brand from Sheffield Pharmaceuticals. It paid USD3.02 million in cash for the three brands (click here to read the News story).
Mexico generated 41.4% of Genomma's total sales. Sales in the company's home market were up by 6.2% to MXN1.28 billion.
Sales in Latin America accounted for 48.1% of Genomma's sales in the second quarter of 2018, with the remaining 10.5% coming from the US.
Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) rose by 8.2% to MXN638 million, giving a margin of 20.6%. Genomma said it continued to implement cost-containment strategies and other initiatives started in 2015.
The company is present in 19 countries including Argentina, Brazil, Chile, Colombia, Ecuador, Peru and the US.
Take out an Annual Subscription to the OTCToolbox website, giving you UNLIMITED ACCESS to all of our publications
* OTCToolbox Innovations magazine NEW IDEAS BETTER WAYS
* OTCToolbox Deals Database
* Premium News Stories
* News Extras
* OTC Deal Trends Briefing
* OTC Company Strategies Report
Helping you and your company make well-informed decisions
CLICK HERE TO FIND OUT MORE