Neimeth’s share price rises by 114.6% in 2 months

By Taofik Salako, Deputy Business Editor

Neimeth International Pharmaceuticals Plc’s share price rose by 9.57 per cent to N1.03 per share on Thursday at the Nigerian Stock Exchange (NSE), bringing the total capital gains by the healthcare company to 114.6 per cent in nearly two months.

Neimeth’s share price closed yesterday at 94 kobo per share, representing an increase of 114.6 per cent on market value per share of 48 kobo recorded by the period ended March 31, 2020.

The price appreciation might not be unconnected with strong fundamental performance and increasing prospects of dividend payment in the current business year. Shareholders of the company had at their annual general meeting earlier in March 2020 approved a balance sheet restructuring that would see the write off of accumulated losses and primed the company for dividend payment from net profit.

Interim report and accounts of Neimeth for the six-month period ended March 31, 2020 released at the NSE showed significant growths across key performance indicators with growing sales and operating efficiency driving operating profit by 225.28 per cent.

Total turnover crossed a record N1 billion mark with 19.4 per cent growth to N1.165 billion by March 2020 compared with N975.98 million recorded in comparable period of March 2019. The top-line growth was driven by increased sales in its domestic Nigerian market. The company recorded growths across its two business segments of pharmaceuticals products and animal health products with the animal health products showing strong prospects for the top-line with 897.5 per cent growth during the period.

Gross profit rose by 22.74 per cent from N450.74 million in 2019 to N553.26 million in 2020. While the company’s continued push for the market saw a relatively modest increase in marketing and distribution expenses, administrative expenses dropped by 10.84 per cent to N228.71 million in March 2020 as against N256.52 million recorded in comparable period of 2019. Profit after tax leapt by 938.5 per cent to N56.6 million by March 2020 compared with N5.45 million by March 2019. Earnings per share thus jumped from 0.29 kobo in March 2019 to 2.98 kobo by March 2020.

Managing Director, Neimeth International Pharmaceuticals Plc, Pharm Matthew Azoji, said the half-year results built on steady growths witnessed in recent periods and further demonstrated that Neimeth is firmly on an upward growth trajectory.

He said the results showed early gains of the company’s five-year strategic plan noting that the company would vigorously expand and reposition its businesses to cement its position as a leading player in not only Nigeria’s healthcare industry but also in the wider West African region while simultaneously ensuring good returns on investment to shareholders.

According to him, the strategic direction for 2020-2024 would see the company implementing bold and gradual expansion initiatives including the upgrade of its factory at Oregun, Lagos state; development of new manufacturing facilities and expansion of the company’s marketing drive to Sub-Saharan Africa (SSA).

Azoji, who was named among the top 25 CEOs in Nigeria by BusinessDay Newspaper and also won the sectoral leadership award of PEARL Awards, said the company is increasingly exploring viable options for strategic local and international partnerships to optimise its excess production capacity through contract manufacturing or direct product development.

He reassured that the company remains focused on attaining the good manufacturing practice (GMP) certificate of the World Health Organisation, in line with its current strategic plan to be manufacturing hub for pharmaceuticals and healthcare products in Sub-Saharan Africa.

“Our results show that we are on course to achieving our strategic growth objectives. We remain committed to our goal of repositioning the company to play greater roles in the healthcare industry, deliver better returns on investment to shareholders and greater benefits to all other stakeholders,” Azoji said.

He said that the COVID-19 pandemic has further highlighted the importance of the healthcare industry adding that Neimeth will continue to explore safe ways of safeguarding people’s health through proactive investments in research and product developments.