To view the PDF file, sign up for a MySharenet subscription.

ASPEN PHARMACARE HOLDINGS LIMITED - Unaudited interim financial results for the six months ended 31 December 2014

Release Date: 05/03/2015 12:10
Code(s): APN     PDF:  
Wrap Text
Unaudited interim financial results for the six months ended 31 December 2014

Aspen Pharmacare Holdings Limited
(Registration number 1985/002935/06)
Share code: APN
ISIN: ZAE000066692
(“Aspen” or “the Group”)

Unaudited interim financial results for the six months ended 31 December 2014

COMMENTARY

GROUP PERFORMANCE
Aspen increased gross revenue 47% to R19,0 billion and raised operating profit 50% to R4,3 billion in the six months
ended 31 December 2014, supported by the contribution from acquisitions concluded in the prior year. Profit for the
period and earnings per share each advanced 27% to R2,5 billion and 539 cents respectively. Normalised headline earnings,
being headline earnings adjusted for specific non-trading items, and normalised headline earnings per share were both 22%
higher at R2,6 billion and 569 cents respectively. The strong results were achieved despite foreign exchange losses of
R343 million caused by the US Dollar strengthening relative to the Group’s major trading currencies. This is estimated
to have reduced earnings per share by 67 cents. 

INTERNATIONAL BUSINESS
Revenue in the International business was 158% higher at R8,8 billion and operating profit before amortisation,
adjusted for specific non-trading items (“EBITA”), was up 127% to R2,5 billion. The International business performance 
was boosted by the inclusion of the significant transactions completed during the previous financial year and delivered 46% 
of Group gross revenue and 53% of Group EBITA. The disposal of the rights to commercialise the fondaparinux products (being
Arixtra and the authorised generic thereof) in the United States to Mylan for a consideration of USD300 million became
effective during the period, with the consequential loss of contribution.

Europe CIS revenue climbed 229% to R5,1 billion. Sales of finished dose form pharmaceuticals to healthcare providers 
comprised R3,4 billion of the total sales with the greatest portion of the balance being from active pharmaceutical
ingredient (“API”) sales. Currency weakness relative to the Rand in Europe CIS diluted results in this region. 

Revenue from customers in Latin America advanced 118% to R2,6 billion, largely driven by the recent infant milk
formula acquisition. Results from Venezuela have been consolidated using hyper-inflationary accounting principles.  In 
addition, given the economic uncertainty in this country, an average exchange rate of 10,0 Bolivars to the US Dollar 
has been adopted despite the exchange rate for supply of medicines being set at 6,30 Bolivars. 

Sales to customers in the Rest of the World were up 36% to R0,9 billion despite the disposal of the fondaparinux
products for the United States to Mylan. 

Capital expenditure projects are continuing at Aspen Oss and Aspen Notre Dame de Bondeville (“NDB”). At Aspen Oss
investments are being made in support of the sustainability of the site and at Aspen NDB additional capacity is being 
added.

ASIA PACIFIC BUSINESS
Revenue in the Asia Pacific region was 3% higher at R4,4 billion. EBITA declined by 1% to R1,0 billion. Positive underlying 
growth in the Australian business countered the consequences of disposals and licence terminations second half of
the previous financial year. The Nutritionals products led the way with strong double-digit growth. Legislated price
cuts have continued in Australia, but were largely negated by product launches, pricing strategies, reduction of
discounts and improved cost of goods. 

Sales to customers in Asia continued on an impressive growth trajectory, doubling to R0,6 billion.

SOUTH AFRICAN BUSINESS
Revenue in the South African business grew by 12% to R4,3 billion. Private sector pharmaceutical sales increased 10%
through a combination of organic growth and new product launches. Sales in the public sector were flat. The consumer
division raised revenue by 30%, led by the Nutritionals products, with Infacare achieving an increase in its share of 
this category.  There was also an improvement in revenue from manufacturing for third parties.
 
EBITA continued to be negatively affected by the weakening of the Rand relative to the US Dollar as well as high wage
and energy cost inflation. Consequently EBITA only increased by 4% to R1,0 billion.

The capital expenditure projects at the Port Elizabeth finished dosage form manufacturing site and the Cape Town API
manufacturing site are progressing well. In Port Elizabeth, the building of the high containment facility is nearing
completion, after which validation of the facility will commence. The packing facility upgrade is also approaching
finalisation and construction of the additional specialist sterile manufacturing facility is underway. This additional
specialist sterile facility will provide enhanced security of supply for Arixtra and Fraxiparine as an alternate 
manufacturing source to Aspen NDB. At Fine Chemicals, production has started in certain of the newly constructed 
suites while other parts of this expansion and upgrade project remain in progress.

SUB-SAHARAN BUSINESS
In Sub-Saharan Africa, revenue improved by 5% to R1,5 billion. Supply constraints, particularly relating to Augmentin,
a leading product in the region, limited growth. Margin improvement initiatives yielded positive results and lifted
EBITA 12% to R210 million.

FUNDING
Borrowings, net of cash, reduced by R1,2 billion over the 6 months to R28,6 billion despite relative foreign exchange
movements adding R1,5 billion to the closing balance. Group operating cash flows were again strong and cash generated 
from operating activities accelerated 128%. Gearing declined to 49% at the period end. Net interest paid, was covered 
six times by operating profit before amortisation.

Net foreign exchange losses of R343 million were incurred, largely as a result of the strengthening of the US Dollar
against Aspen’s primary trading currencies during the course of the six months. 

PROSPECTS
The results for the first six months have been unfavourably affected by relative currency movements. Aspen remains
vulnerable to a continued strengthening of the US Dollar against its primary trading currencies of the Euro, the Australian
Dollar and the Rand.

Recent acquisitions have enabled the Group to achieve end-to-end integration of the supply chain for injectable
anti-coagulants. The effective integration of this supply chain and the harnessing of the resultant economies of scale are the
focus of a number of profit- enhancement projects. Improved procurement and production efficiencies are being targeted for
Aspen’s key anti-coagulant portfolio. This portfolio will also benefit from the completion of the transaction which adds
Mono-Embolex to the product offering in Germany. Positive advances have been made in the technical work being
undertaken, which is focused on securing increased production of the API for Orgaran, an effective treatment for
heparin-induced-thrombosis, with significant growth prospects once supply is unrestricted. The transition of the recently 
acquired products from GSK and Merck is nearing completion, which allows for better co-ordinated promotion and control of these
products. Work is also proceeding favourably to improve the cost of goods for the Nutritionals products and strategies to
increase share in Nutritionals in Latin America have been implemented. 

These projects should particularly benefit the International region, the largest contributor to Group profits. This
segment is, however, also exposed to political and economic instability in Venezuela and Russia, two countries in which
Aspen had been expecting material growth. Remittance of funds to pay for products supplied to Venezuela has become
significantly constrained. The sharp devaluation of the Ruble in recent months has significantly diminished the value of
the business undertaken in Russia. 

In the Asia Pacific region, the anticipated decline in performance due to the disposal of certain non-core products in
the prior year and the exit from licence arrangements was substantially covered by a strong performance in the first
half. However, Australia will remain exposed to these consequences, a weakening currency and a further regulated price cut
into the second half. The recent formation of Aspen Japan, in which GSK has a 25% shareholding, is an important step
towards the Group establishing itself in that country, which is ranked second in the world by value of pharmaceutical
sales. Aspen Japan is scheduled to commence trade in July 2015.

Aspen continues to lead the industry in South Africa. The positive momentum established in private sector performance
in the first six months should be maintained. The Department of Health awarded a 7,5% increase in the single exit price
which will benefit the last quarter. Together with ongoing growth in volumes, this should provide some relief to the 
pressure on margins created by currency-influenced increases in imported materials and sharp rises in administered costs. 
The award of the anti-retroviral and other material public sector tenders recently provides guidance on volume expectations
for supply to Government and should assist in production planning. 

In spite of political uncertainty, particularly in Nigeria and Tanzania where elections are scheduled, the business in
sub-Saharan Africa has potential for improved performance based on Aspen’s strong positioning in the region and the
underlying growth dynamic. However, continuation of the supply constraints experienced in the first half may prevent this
potential from being fully realised.

The restructuring and consolidation which is currently prevalent in the global pharmaceutical industry is creating a
number of acquisitive opportunities as businesses are re-sized and re-shaped. Aspen is well placed to participate in this
process and executive management is actively engaged in assessing possibilities. The Group has a proven capability to
successfully execute complex multi-territory transactions, which makes it a strong candidate for such opportunities.

By order of the Board

NJ Dlamini                                  SB Saad
(Chairman)                                  (Group Chief Executive)

Woodmead
5 March 2015


GROUP STATEMENT OF COMPREHENSIVE INCOME                                                                                                  
                                                                                             Unaudited       Unaudited           
                                                                                            six months      six months         Audited  
                                                                                                 ended           ended      year ended      
                                                                                           31 December     31 December         30 June      
                                                                                                  2014            2013            2014 
                                                                      Notes     Change       R’million       R’million       R’million             
Revenue                                                                            51%        18 033,3        11 976,3        29 515,1   
Cost of sales                                                                                 (9 562,3)       (6 398,7)      (15 793,2)   
Gross profit                                                                       52%         8 471,0         5 577,6        13 721,9   
Selling and distribution expenses                                                             (2 809,7)       (1 474,4)       (4 401,3)   
Administrative expenses                                                                       (1 184,1)         (932,2)       (1 652,5)   
Other operating income                                                                           168,7            51,5           692,4   
Other operating expenses                                                                        (327,5)         (342,4)         (935,7)   
Operating profit                                                         B#        50%         4 318,4         2 880,1         7 424,8   
Investment income                                                        C#                      188,3           132,0           278,1   
Financing costs                                                          D#                   (1 395,2)         (537,9)       (1 346,4)   
Profit before tax                                                                  26%         3 111,5         2 474,2         6 356,5   
Tax                                                                                             (653,4)         (544,3)       (1 351,0)   
Profit                                                                             27%         2 458,1         1 929,9         5 005,5   
OTHER COMPREHENSIVE INCOME , NET OF TAX*                                                                                                 
Net investment hedge profit in Aspen Asia Pacific                                                    -            23,9            23,9   
Net gains from cash flow hedging in respect of business acquisitions                                 -           115,9            75,1   
Net losses from cash flow hedging of prepayment in respect of 
business acquisition                                                                                 -           (41,0)              -   
Currency translation movements                                           E#                      282,6         1 066,0         1 829,3   
Cash flow hedges recognised                                                                        8,7             4,3             3,0   
Remeasurement of retirement and other employee benefits                                              -               -           (25,3)   
Total comprehensive income                                                                     2 749,4         3 099,0         6 911,5   
Profit attributable to                                                                                               
Equity holders of the parent                                                                   2 460,3         1 930,6         5 007,6   
Non-controlling interests                                                                         (2,2)           (0,7)           (2,1)   
                                                                                               2 458,1         1 929,9         5 005,5   
Total comprehensive income attributable to                                                                         
Equity holders of the parent                                                                   2 751,6         3 101,4         6 915,4   
Non-controlling interests                                                                         (2,2)           (2,4)           (3,9)   
                                                                                               2 749,4         3 099,0         6 911,5   
Weighted average number of shares in issue (‘000)                                              456 346         455 944         456 116   
Diluted weighted average number of shares in issue (‘000)                                      456 449         456 574         456 219   
EARNINGS PER SHARE                                                                                                                       
Basic earnings per share (cents)                                                   27%           539,1           423,4         1 097,9   
Diluted earnings per share (cents)                                                 27%           539,0           422,8         1 097,6   
DISTRIBUTION TO SHAREHOLDERS                                                                                                             
Capital distribution per share (cents)                                                           188,0            26,0            26,0   
Cash dividend per share (cents)                                                                      -           131,0           131,0   
                                                                                   20%           188,0           157,0           157,0   
The capital distribution to shareholders of 188,0 cents relates to the distribution declared on 10 September 2014 and 
paid on 13 October 2014. (2013 distribution: the total distribution of 157,0 cents relates to the distribution declared 
on 11 September 2013 and paid on 14 October 2013).                                                                          
                                                                                                                                                            
# See notes on Supplementary information.                                                                                                                    
* Remeasurement of retirement benefit obligations will not be reclassified to profit and loss. All other items in other 
  comprehensive income may be reclassified to profit and loss.                                                                          


GROUP STATEMENT OF HEADLINE EARNINGS                                                                                                        
                                                                                       Unaudited       Unaudited           
                                                                                      six months      six months         Audited  
                                                                                           ended           ended      year ended      
                                                                                     31 December     31 December         30 June      
                                                                                            2014            2013            2014 
                                                                          Change       R’million       R’million       R’million             
HEADLINE EARNINGS                                                                                                                  
Reconciliation of headline earnings                                                                                                
Profit attributable to equity holders of the parent                          27%         2 460,3         1 930,6         5 007,6   
Adjusted for:                                                                                                                      
- Net impairment/(reversal of impairment) of property, plant and        
  equipment (net of tax)                                                                     1,0             0,1            (5,8)   
- Net impairment of intangible assets (net of tax)                                          10,4             0,5           112,6   
- Loss/(profit) on the sale of tangible and intangible assets           
  (net of tax)                                                                               0,2             3,0          (478,7)   
Headline earnings                                                            28%         2 471,9         1 934,2         4 635,7   
Headline earnings per share (cents)                                          28%           541,7           424,2         1 016,3   
Diluted headline earnings per share (cents)                                  28%           541,6           423,6         1 016,1   
NORMALISED HEADLINE EARNINGS                                                                                                       
Reconciliation of normalised headline earnings                                                                                     
Headline earnings                                                            28%         2 471,9         1 934,2         4 635,7   
Adjusted for:                                                                                                                      
- Restructuring costs (net of tax)                                                          24,2             8,1            29,4   
- Transaction costs (net of tax)                                                           101,0           201,1           435,9   
- Net foreign exchange (gains)/losses from hedging of business          
  acquisitions (net of tax)                                                                    -            (9,3)            1,7   
- Foreign exchange gain on settlement of transaction funding liability  
  (net of tax)                                                                                 -               -          (248,9)   
Normalised headline earnings                                                 22%         2 597,1         2 134,1         4 853,8   
Normalised headline earnings                                                                                                       
Normalised headline earnings per share (cents)                               22%           569,1           468,1         1 064,2   
Normalised diluted headline earnings per share (cents)                       22%           569,0           467,4         1 063,9   


GROUP STATEMENT OF FINANCIAL POSITION                                                                                       
                                                                     Unaudited       Unaudited        Audited   
                                                                   31 December     31 December        30 June    
                                                                          2014            2013           2014   
                                                                     R’million       R’million      R’million   
ASSETS                                                                                                          
Non-current assets                                                                                              
Property, plant and equipment                                          7 547,9         6 058,3        7 150,8   
Goodwill                                                               6 289,1         6 182,6        6 641,8   
Intangible assets                                                     38 615,6        36 333,7       35 698,9   
Contingent environmental indemnification assets                          699,2           724,8          727,1   
Other non-current assets                                                 450,3            26,7          298,9   
Deferred tax assets                                                      831,4           415,0          817,1   
Total non-current assets                                              54 433,5        49 741,1       51 334,6   
Current assets                                                                                                  
Inventories                                                           10 124,1         9 273,7       10 275,2   
Receivables and other current assets                                  10 413,5        11 113,9        9 661,2   
Cash and cash equivalents                                             10 935,7        10 425,6        8 225,6   
Total operating current assets                                        31 473,3        30 813,2       28 162,0   
Assets classified as held-for-sale                                           -               -        3 050,8   
Total current assets                                                  31 473,3        30 813,2       31 212,8   
Total assets                                                          85 906,8        80 554,3       82 547,4   
SHAREHOLDERS’ EQUITY                                                                                            
Share capital and treasury shares                                      3 006,4         3 865,3        3 867,9   
Reserves                                                              27 734,9        21 300,0       25 006,3   
Ordinary shareholders’ equity                                         30 741,3        25 165,3       28 874,2   
Non-controlling interests                                                  1,5             2,7            1,9   
Total shareholders’ equity                                            30 742,8        25 168,0       28 876,1   
LIABILITIES                                                                                                     
Non-current liabilities                                                                                         
Borrowings                                                            30 324,4        31 545,3       29 915,5   
Contingent environmental liabilities                                     699,2           724,8          727,1   
Unfavourable and onerous contracts                                     2 412,7         2 943,3        2 638,7   
Other non-current liabilities                                          2 439,9         2 390,2        2 499,3   
Deferred tax liabilities                                               1 411,6           596,9        1 351,1   
Retirement and other employee benefits                                   501,7           148,7          497,6   
Total non-current liabilities                                         37 789,5        38 349,2       37 629,3   
Current liabilities                                                                                             
Trade and other payables                                               7 131,7        10 856,6        6 884,0   
Borrowings*                                                            9 230,1         5 111,1        8 075,3   
Unfavourable and onerous contracts                                       324,8           336,4          335,3   
Other current liabilities                                                687,9           733,0          747,4   
Total current liabilities                                             17 374,5        17 037,1       16 042,0   
Total liabilities                                                     55 164,0        55 386,3       53 671,3   
Total equity and liabilities                                          85 906,8        80 554,3       82 547,5   
Number of shares in issue (net of treasury shares) (‘000)              456 041         455 781        455 914   
Net asset value per share (cents)                                      6 740,9         5 521,4        6 333,3   
*Includes bank overdrafts.                                                                     


GROUP STATEMENT OF CHANGES IN EQUITY                                                                                                                                         
For the six months ended 31 December 2014                                                                                                                             
                                                                                              Total                
                                                    Share capital                   attributable to                   
                                                  net of treasury                    equity holders     Non-controlling                    
                                                           shares      Reserves       of the parent           interests         Total                  
                                                        R’million     R’million           R’million           R’million     R’million           
BALANCE AT 1 JULY 2013                                    3 989,2      18 804,6            22 793,8                 5,1      22 798,9   
Total comprehensive income                                      -       3 101,4             3 101,4                (2,4)      3 099,0   
Profit for the period                                           -       1 930,6             1 930,6                (0,7)      1 929,9   
Other comprehensive income                                      -       1 170,8             1 170,8                (1,7)      1 169,1   
Capital distribution and dividends paid                    (118,6)       (597,6)             (716,2)                  -        (716,2)   
Issue of ordinary share capital - share schemes               1,6             -                 1,6                   -           1,6   
Treasury shares purchased                                   (22,3)            -               (22,3)                  -         (22,3)   
Deferred incentive bonus shares exercised                    15,4         (15,4)                  -                   -             -   
Share options and appreciation rights expensed     
(including deferred incentive bonus)                            -           7,0                 7,0                   -           7,0   
BALANCE AT 31 DECEMBER 2013                               3 865,3      21 300,0            25 165,3                 2,7      25 168,0   
                                                                                                                                        
BALANCE AT 1 JULY 2014                                    3 867,9      25 006,3            28 874,2                 1,9      28 876,1   
Total comprehensive income                                      -       2 751,6             2 751,6                (2,2)      2 749,4   
Profit for the period                                           -       2 460,3             2 460,3                (2,2)      2 458,1   
Other comprehensive income                                      -         291,3               291,3                   -         291,3   
Capital distribution and dividends paid                    (857,3)            -              (857,3)               (0,3)       (857,6)   
Issue of ordinary share capital - share schemes               0,2             -                 0,2                   -           0,2   
Treasury shares purchased                                   (21,7)            -               (21,7)                  -         (21,7)   
Deferred incentive bonus shares exercised                    17,3         (17,3)                  -                   -             -   
Share options and appreciation rights expensed     
(including deferred incentive bonus)                            -           8,1                 8,1                   -           8,1   
Acquisition of non-controlling interests                        -         (13,8)              (13,8)                2,1         (11,7)   
BALANCE AT 31 DECEMBER 2014                               3 006,4      27 734,9            30 741,3                 1,5      30 742,8   
                                                       

GROUP STATEMENT OF CASH FLOWS                                                                                                    
                                                                                     Unaudited       Unaudited            
                                                                                    six months      six months         Audited 
                                                                                         ended           ended      year ended    
                                                                                   31 December     31 December         30 June      
                                                                                          2014            2013            2014
                                                                        Notes        R’million       R’million       R’million            
CASH FLOWS FROM OPERATING ACTIVITIES                                                                                             
Cash operating profit                                                                  4 916,9         3 278,3         7 911,2   
Changes in working capital                                                              (655,1)       (1 113,6)       (2 187,5)   
Cash generated from operations                                                         4 261,8         2 164,7         5 723,7   
Net financing costs paid                                                              (1 029,8)         (296,7)         (709,1)   
Tax paid                                                                                (544,9)         (691,7)       (1 178,3)   
Cash generated from operating activities                                               2 687,1         1 176,3         3 836,3   
CASH FLOWS USED IN INVESTING ACTIVITIES                                                                                          
Capital expenditure - property, plant and equipment                         A#          (809,2)         (808,9)       (1 328,9)   
Proceeds on the sale of property, plant and equipment                                     13,0             6,7           106,3   
Capital expenditure - intangible assets                                     A#          (764,1)         (255,4)         (700,4)   
Proceeds on the sale of intangible assets                                                184,5            11,9           898,8   
Acquisition of subsidiaries and businesses                                  H#             4,3       (10 806,8)      (19 764,2)   
Acquisition of non-controlling interests                                                 (11,7)              -               -   
Increase in other non-current assets                                                    (161,9)              -               -   
Proceeds on the disposal of assets classified as held-for-sale                         2 790,4               -               -   
Net investment hedge profit in Aspen Asia Pacific                                            -            23,9            23,9   
Net losses from cash flow hedging of prepayment in respect of 
business acquisition                                                                         -           (41,0)              -   
Prepayment in anticipation of acquisition                                                    -        (3 316,4)              -   
Payment of deferred consideration relating to prior year 
business acquisitions                                                                   (359,1)              -           (85,9)   
Cash generated from/(used in) investing activities                                       886,2       (15 186,0)      (20 850,4)   
CASH FLOWS FROM FINANCING ACTIVITIES                                                                                             
Net proceeds from borrowings                                                              90,9        20 445,6        20 183,3   
Capital distribution and dividends paid                                                 (857,6)         (716,2)         (716,2)   
Proceeds from issue of ordinary share capital                                              0,2             1,6             2,7   
Treasury shares purchased                                                                (21,7)          (22,3)          (22,3)   
Cash (used in)/ generated from financing activities                                     (788,2)       19 708,7        19 447,5   
Movement in cash and cash equivalents before effects of exchange 
rate changes                                                                           2 785,1         5 699,0         2 433,4   
Effects of exchange rate changes                                                        (241,3)          517,5           312,2   
Movement in cash and cash equivalents                                                  2 543,8         6 216,5         2 745,6   
Cash and cash equivalents at the beginning of the period/year                          6 161,8         3 416,2         3 416,2   
Cash and cash equivalents at the end of the period/year                                8 705,6         9 632,7         6 161,8   
RECONCILIATION OF CASH AND CASH EQUIVALENTS                                                                                      
Cash and cash equivalents per the statement of financial position                     10 935,7        10 425,6         8 225,6   
Less: bank overdrafts                                                                 (2 230,1)         (792,9)       (2 063,8)   
                                                                                       8 705,6         9 632,7         6 161,8   
                                                                        Change                                                   
Operating cash flow per share (cents)                                     128%           588,8           258,0           841,1   
For the purposes of the statement of cash flows, cash and cash equivalents comprise cash-on-hand, deposits held on call 
with banks less bank overdrafts.                                                              


GROUP SEGMENTAL ANALYSIS                                                                                                                     
                                                   Unaudited                 Unaudited                               Audited                   
                                               six months ended           six months ended                         year ended                   
                                               31 December 2014            31 December 2013                        30 June 2014                  
                                           R’million    % of total     R’million    % of total    Change     R’million     % of total   
REVENUE                                                                                                                                 
International^                               8 803,8            46       3 408,2            26      158%      12 724,8             40   
Asia Pacific@                                4 422,7            23       4 291,4            33        3%       8 517,2             27   
South Africa+                                4 306,7            23       3 836,7            30       12%       7 446,3             24   
Sub-Saharan Africa                           1 466,6             8       1 393,8            11        5%       2 744,3              9   
Total gross revenue                         18 999,8           100      12 930,1           100       47%      31 432,6            100   
Adjustment*                                   (966,5)                     (953,8)                             (1 917,5)                  
Total revenue                               18 033,3                    11 976,3                     51%      29 515,1                  
OPERATING PROFIT BEFORE AMORTISATION                                                                                                    
Adjusted for specific non-trading 
items (“EBITA”)                                                                                       
International                                2 452,1            53       1 081,4            33      127%       3 636,1             47   
Operating profit#                            2 269,0                       932,1                    143%       3 633,1                  
Amortisation of intangible assets              115,4                        87,2                                 180,4                  
Transaction costs                               34,3                        55,3                                 255,0                  
Loss/(profit) on sale of assets                  1,1                           -                                (522,0)                  
Restructuring costs                             32,3                         6,8                                     -                  
Impairment of assets                               -                           -                                  89,6                  
Asia Pacific                                   981,8            21         988,1            31       (1%)      1 944,6             25   
Operating profit#                              912,5                       915,5                      0%       1 811,6                  
Amortisation of intangible assets               67,5                        61,9                                 138,2                  
Transaction costs                                  -                         6,8                                   7,0                  
Restructuring costs                              3,2                         3,9                                  42,1                  
Reversal of impairment losses                      -                           -                                  (5,8)                  
Profit on the sale of assets                    (1,4)                          -                                 (48,5)                  
South Africa                                   993,1            21         955,8            30        4%       1 816,5             24   
Operating profit#                              930,3                       848,1                     10%       1 652,7                  
Amortisation of intangible assets               45,8                        26,7                                  65,1                  
Transaction costs                                5,2                        80,4                                     -                  
Loss on the sale of assets                       0,2                           -                                  77,4                  
Impairment of assets                            11,6                         0,6                                  21,3                  
Sub-Saharan Africa                             209,7             5         187,4             6       12%         333,6              4   
Operating profit#                              206,6                       184,4                     12%         327,4                  
Amortisation of intangible assets                3,1                         3,0                                   6,2                                                                                                                                                               
Total EBITA                                  4 636,7           100       3 212,7           100       44%       7 730,8            100   
ENTITY-WIDE DISCLOSURE - REVENUE                                                                                                              
Analysis of revenue in accordance 
with customer geography                                                                                     
Europe CIS                                   5 068,3            26       1 540,8            12      229%       7 200,1             23   
Asia Pacific                                 4 645,0            24       4 297,8            33        8%       8 798,7             28   
South Africa                                 4 310,0            23       3 840,3            30       12%       7 451,4             24   
Latin America                                2 618,0            14       1 202,7             9      118%       3 484,6             11   
Sub-Saharan Africa                           1 470,9             8       1 397,4            11        5%       2 752,6              9   
Rest of the World                              887,6             5         651,1             5       36%       1 745,2              5   
Total gross revenue                         18 999,8           100      12 930,1           100       47%      31 432,6            100   
Adjustment*                                   (966,5)                     (953,8)                             (1 917,5)                  
Total revenue                               18 033,3                    11 976,3                     51%      29 515,1                  
^ Excludes intersegment revenue of R921,8 million (2013: R914,4 million).                                                                                                   
@ Excludes intersegment revenue of R8,5 million (2013: nil).                                                                                                   
+ Excludes intersegment revenue of R47,5 million (2013: R47,6 million).                                                                                                   
* The profit share from the GSK Aspen Healthcare for Africa collaboration has been disclosed as revenue in the statement of 
  comprehensive income. For segmental purposes the total revenue for the GSK Aspen Healthcare for Africa collaboration has been 
  included to provide enhanced revenue visibility in this territory.                                                                                                  
# The aggregate segmental operating profit total of R4 318,4 million (2013: R2 880,1 million) agrees to the statement of comprehensive income.                                                                                                  


GROUP SUPPLEMENTARY INFORMATION                                                                                                                                                                              
                                                                               Unaudited       Unaudited             
                                                                              six months      six months         Audited
                                                                                   ended           ended      year ended  
                                                                             31 December     31 December         30 June          
                                                                                    2014            2013            2014
                                                                               R’million       R’million       R’million           
A. CAPITAL EXPENDITURE                                                                                                     
   Incurred                                                                      1 573,3         1 064,3         2 029,3   
   - Property, plant and equipment                                                 809,2           808,9         1 328,9   
   - Intangible assets                                                             764,1           255,4           700,4   
   Contracted                                                                    2 156,1           765,7           477,2   
   - Property, plant and equipment                                                 512,1           635,8           425,7   
   - Intangible assets                                                           1 644,0           129,9            51,5   
   Authorised but not contracted for                                             2 302,5         1 100,5         2 967,1   
   - Property, plant and equipment                                               2 100,9           723,4         2 652,9   
   - Intangible assets                                                             201,6           377,1           314,2   
                                                                                                                           
B. OPERATING PROFIT HAS BEEN ARRIVED AT AFTER CHARGING:                                                        
   Depreciation of property, plant and equipment                                   288,2           188,0           433,9   
   Amortisation of intangible assets                                               231,8           178,8           389,9   
   Net impairment of assets                                                         11,6             0,6           105,1   
   Share-based payment expenses - employees                                         20,8            15,5            47,5   
   Restructuring costs                                                              35,5            10,7            42,1   
   Transaction costs                                                                39,5           142,5           339,4   
   Hyperinflationary reduction in operating profit                                   2,2               -            80,9
   
C. INVESTMENT INCOME                                                                                                       
   Interest received                                                               188,3           132,0           278,1 
   
D. FINANCING COSTS                                                                                                         
   Interest paid                                                                  (896,1)         (459,4)       (1 295,9)   
   Debt raising fees on acquisitions                                               (65,8)          (83,3)         (154,7)   
   Net foreign exchange (losses)/gains                                            (342,5)           48,9            80,7   
   Foreign currency gain on settlement of transaction funding liability                -               -           248,9   
   Fair value gains/(losses) on financial instruments                               13,6            (8,3)          (86,0)   
   Notional interest on financial instruments                                      (88,2)          (35,8)         (131,4)   
   Net hyperinflationary adjustments                                               (16,2)              -            (8,0)   
                                                                                (1 395,2)         (537,9)       (1 346,4) 

E. CURRENCY TRANSLATION MOVEMENTS                                                                                                                                                                                                                                                                                                                                                                                                     
   Currency translation movements on the translation of the offshore businesses are as a result of the difference between 
   the weighted average exchange rate used for trading results and the opening and closing exchange rates applied in the 
   statement of financial position. For the period the weaker closing Rand translation rate increased the Group net asset 
   value. 
   
F. CONTINGENT LIABILITIES                                                                                                                   
   There are contingent liabilities in respect of:                                                                          
   Contingency relating to product litigation                                       30,0            27,3            27,6   
   Customs guarantee                                                                14,2            14,2            14,8   
   Indirect tax contingent liability                                                24,4            10,4            36,1   
   Contingencies arising from labour cases                                           2,5             4,3             2,8   
   Other contingent liabilities                                                      1,9             2,2             5,7   
                                                                                    73,0            58,4            87,0   
G. GUARANTEES TO FINANCIAL INSTITUTIONS                                                                                    
   Guarantees given by Group companies for indebtedness of                      
   subsidiaries to financial institutions                                       13 488,4        11 537,7        12 888,7   

H. ACQUISITION OF SUBSIDIARIES AND BUSINESSES                                               
   2014                                                                                                
   Set out below is the final accounting for the following June 2014 business combinations:                                                  
   API business                                                                                         
   On 1 October 2013, Aspen Pharmacare Holdings Limited acquired 100% shareholding of an active pharmaceutical ingredient 
   (“API”) manufacturing business from Merck which manufactures for Merck and the market generally and which is located in 
   the Netherlands, with a satellite facility and sales office in the US (“the API Business”) for a purchase consideration 
   of EUR 31 million (net of cash acquired).                                                  
   The initial accounting for this business combination was reported on a provisional basis in June 2014 and was finalised 
   in the six months ended 31 December 2014.                                                  
                                                                              Preliminary     Adjustments         Final    
   Fair value of assets and liabilities acquired                                R’million       R’million     R’million   
   Property, plant and equipment                                                    589,1               -         589,1   
   Intangible assets                                                                506,3               -         506,3   
   Contingent environmental indemnification assets                                  680,1               -         680,1   
   Deferred tax assets                                                               47,0           (22,5)         24,5   
   Inventories                                                                    3 267,0          (119,2)      3 147,8   
   Trade and other receivables                                                      392,5           160,8         553,3   
   Cash and cash equivalents                                                      1 272,5               -       1 272,5   
   Contingent environmental liabilities                                            (680,1)              -        (680,1)   
   Environmental liabilities                                                        (74,5)              -         (74,5)   
   Unfavourable and onerous contracts                                            (2 791,1)          (23,4)     (2 814,5)   
   Trade and other payables                                                        (349,9)              -        (349,9)   
   Other non-current and current financial liabilities                           (1 146,2)            4,3      (1 141,9)   
   Purchase consideration paid                                                    1 712,7               -       1 712,7   
   Cash and cash equivalents in acquired companies                               (1 272,5)              -      (1 272,5)   
   Cash outflow on acquisition                                                      440,2               -         440,2   

   Merck products                                                                                      
   Aspen Global Incorporated, a wholly owned subsidiary of Aspen Pharmacare Holdings Limited, exercised an option to acquire 
   a portfolio of 11 branded finished dose form molecules (“the Merck Products”) from Merck for a consideration of USD600 
   million effective on 31 December 2013. USD533 million of the consideration was paid on 2 January 2014, and the balance of 
   this consideration will be paid in five equal annual instalments commencing at the end of the first year after the 
   acquisition date. 
   
   The initial accounting for this business combination was reported on a provisional basis in June 2014 and was finalised in 
   the six months ended 31 December 2014, with no subsequent changes.                                                  

   Latin America infant nutritional business                                                            
   On 28 October 2013 Aspen Group Companies concluded agreements with Nestlé in respect of the acquisition of certain licence 
   rights to intellectual property, net assets (including an infant nutritional production facility located in Vallejo, Mexico) 
   and a 100% shareholding in the infant nutritional businesses presently conducted by Nestlé and Pfizer in Latin America, 
   predominantly in Mexico, Venezuela, Colombia, Ecuador, Chile, Peru, Central America and the Caribbean, for a purchase 
   consideration of USD180 million.    
   
   The initial accounting for this business combination was reported on a provisional basis in June 2014 and was finalised in 
   the six months ended 31 December 2014.

   Fair value of assets and liabilities acquired                              Preliminary     Adjustments         Final    
                                                                                R’million       R’million     R’million   
   Property, plant and equipment                                                    620,0               -         620,0   
   Intangible assets                                                                736,2            12,4         748,6   
   Current tax assets                                                                 3,0               -           3,0   
   Inventories                                                                      520,6               -         520,6   
   Trade and other receivables                                                      465,1               -         465,1   
   Retirement and other employee benefits                                           (37,2)              -         (37,2)   
   Deferred tax liabilities                                                          (2,7)              -          (2,7)   
   Trade and other payables                                                        (549,5)          (16,7)       (566,2)   
   Fair value of net assets acquired                                              1 755,5            (4,3)      1 751,2   
   Goodwill acquired                                                                 14,3               -          14,3   
   Cash outflow/(inflow) on acquisition                                           1 769,8            (4,3)      1 765,5   
                                                                                                                    
Subsequent events
Aspen Global Incorporated entered into an agreement with Novartis AG for the acquisition of the rights to
Mono-Embolex®, an injectable anti-coagulant, for a consideration of USD142 million. The transaction was subject to the 
approval of the German competition authorities, which condition has been fulfilled, and the transaction became effective 
on 20 February 2015.

Basis of accounting
The unaudited interim financial results for the six months ended 31 December 2014 have been prepared in accordance
with International Financial Reporting Standards, IFRIC interpretations, the Listings Requirements of the JSE Limited,
South African Companies Act, 2008 and the presentation and disclosure requirements of IAS 34: Interim Reporting. The
accounting policies are consistent with those described in the Annual Financial Statements.

The entity-wide analysis included in the segmental analysis for the six months ended 31 December 2013 was restated to
disclose the Europe CIS region seperately due to the increased materiality of this region to the Group. South Africa was
restated to disclose only the total revenue in the entity-wide disclosure as the split between the pharmaceutical and
consumer businesses is no longer material to the total Group results.

These unaudited interim financial results were prepared under the supervision of the Deputy Group Chief Executive, 
MG Attridge CA(SA), and approved by the Board of Directors.

Change in directorate
DS Redfern was appointed to the board with effect from 1 February 2015, following the resignation of SA Hussain with
effect from that date.

Directors
N J Dlamini (Chairman)*, R C Andersen*, M G Attridge, M R Bagus*, J F Buchanan*, K D Dlamini*, M M Manyama*, 
C N Mortimer*, R S Redfern*, S B Saad, S V Zilwa*                            *Non-executive director

Company Secretary
R Verster

Registered office
Building Number 8, Healthcare Park, Woodlands Drive, Woodmead
PO Box 1587, Gallo Manor, 2052
Telephone 011 239 6100
Telefax 011 239 6144

Sponsor
Investec Bank Limited

Transfer secretary
Computershare Investor Services Proprietary Limited
(Registration number 2004/003647/07),
70 Marshall Street, Johannesburg, 2001.
(PO Box 61051, Marshalltown, 2107)

www.aspenpharma.com

Disclaimer
We may make statements that are not historical facts and relate to analyses and other information based on forecasts
of future results and estimates of amounts not yet determinable. These are forward-looking statements as defined in the
U.S. Private Securities Litigation Reform Act of 1995. Words such as “prospects”, “believe”, “anticipate”, “expect”,
“intend”, “seek”, “will”, “plan”, “indicate”, “could”, “may”, “endeavour” and “project” and similar expressions are 
intended to identify such forward-looking statements, but are not the exclusive means of identifying such statements. 
By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and 
there are risks that predictions, forecasts, projections and other forward-looking statements will not be achieved. If one 
or more of these risks materialise, or should underlying assumptions prove incorrect, actual results may be very different
from those anticipated. The factors that could cause our actual results to differ materially from the plans, objectives,
expectations, estimates and intentions expressed in such forward-looking statements are discussed in each year’s annual
report. Forward-looking statements apply only as of the date on which they are made, and we do not undertake, other than
in terms of the Listings Requirements of the JSE Limited, any obligation to update or revise any of them, whether as a
result of new information, future events or otherwise. All profit forecasts published in this report are unaudited.
Date: 05/03/2015 12:10:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
 information disseminated through SENS.

Share This Story