PRESS-RELEASE FOR IMMEDIATE DISTRIBUTION APRIL 30, 2014 OJSC «VEROPHARM» ANNOUNCES FINANCIAL RESULTS OF 2013 April 30, 2014, MOSCOW OJSC «VEROPHARM» [RTS:VRPH, MICEX:VFRM] announces its audited financial results of the year 2013 in accordance with the International Financial Reporting Standards (IFRS). SALES o Sales in 2013 amounted to RUR 5,269 mln. The share of product segments in OJSC Veropharm sales is as follows: Group of pharmaceutical products Rx drugs sales amounted to RUR 3,725 mln. The Rx drugs sales made 70.7% of total sales of the Company against 66.8% in 2012; OTC drugs sales amounted to RUR 794 mln. The OTC drugs sales made 15.1% of total sales of the Company against 14.4% in 2012; Traditional drugs sales amounted to RUR 15 mln. The traditional drugs sales made 0.3% of total sales of the Company against 0.4% in 2012; Group of non-pharmaceutical products Non-pharmaceutical products sales made RUR 735 mln, which corresponds to 14.0% of total sales of the Company. o Under the Federal Reimbursement Program (FRP) Veropharm s sales amounted to RUR 33.8 mln according to the results of 2013, which corresponds to 0.6% of the Company s total sales. o The Russian Federation is the main market and ensures 94.9% of the Company's sales. During 2013 the Company has exported 5.1% of its products.
PROFIT o In 2013 the gross profit of OJSC Veropharm amounted to RUR 3,132 mln. The gross profit ratio in 2013 made 59.4%. The gross profit ratio of the segments of OJSC Veropharm is as stated: Group of pharmaceutical products In relation to Rx drugs it made 58.4% in 2013 against 50.7% in 2012; In relation to OTC drugs it made 66.2% in 2013 against 71.0% in 2012; In relation to traditional products it made 46.3% in 2013 against 52.9% in 2012. Group of non-pharmaceutical products In relation to non-pharmaceutical products it made 57.6% in 2013 against 67.0% in 2012. o In 2013 EBITDA amounted to RUR 1,165 mln. EBITDA margin made 22.1%. o Operating profit in 2013 made RUR 1,038 mln. Operating profit margin made 19.7% in 2013. o Net profit for the reporting period amounted to RUR 612 mln. Net profit margin made 11.6%. FACILITIES INVESTMENTS o In 2013 the amount of investments assigned for modernization and equipment of the main production facilities of the Company made RUR 2,894 mln. DEBT o As at December 31, 2013 the debt of OJSC Veropharm amounted to RUR 2,667 mln, which makes no more than 30% of the Company s net assets value. RUR mln Segment sales Gross profit 2013 2012 % growth 2013 2012 % growth Pharmaceutical products 4,534 4,491 0.9% 2,708 2,437 11.1% Non-pharmaceutical products 735 1,016-27.6% 424 681-37.7% Total 5,269 5,507-4.3% 3,132 3,118 0.5%
For further information please call OJSC Veropharm : Maksutova Nadiya, Chief Financial Officer maksutova.nadiya@veropharm.ru tel. (+7 495) 792 53 30 Or visit the web-site of the Company www.veropharm.ru Notes to the Editor: VEROPHARM OJSC is one of the largest Russian pharmaceutical manufacturers. Shares of the Company are traded at MICEX (ticker: VFRM). Market capitalization of the Company as of December 31, 2013 totaled RUR 9,434 billion (according to RTS). The charter capital of the Company makes 10 million ordinary shares. VEROPHARM OJSC is the market leader in Russia for production of plasters and oncological medicines. The Company s production facilities comprise 3 pharmaceutical plants in Belgorod, Voronezh and Pokrov. The Company s product portfolio includes more than 300 items. VEROPHARM OJSC employs more than 1,700 people. In the annual research conducted by the portal SuperJob.ru among Russian companies OJSC VEROPHARM is recognized as one of the most attractive employers in the labor market and is awarded the status of "Attractive employer-2012. According to IMS Health, following the results of 2013 Veropharm occupies the 6 th position in the rating Russian pharmaceutical manufacturers in production volume terms. According to IMS Health, following the results of 2013, as compared to the same period of the previous year, Veropharm takes the following positions among Russian and foreign manufacturers in the rating Oncology drugs manufacturers : o 7 th place in monetary terms o 1 st place in physical terms (occupies the leading position). THIS DOCUMENT IS NOT AN ADVERTISEMENT OF SECURITIES IN THE RUSSIAN FEDERATION, AND IS NOT AN OFFER TO SELL, OR AN INVITATION TO MAKE OFFERS TO PURCHASE, ANY SECURITIES IN THE RUSSIAN FEDERATION. NOT FOR RELEASE, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA OR JAPAN. This document may include statements that are forward-looking statements, including future operating results of the Company. These forward-looking statements involve risk and uncertainty regarding implementation of future activities. As a result, actual future results may differ materially from the plans, goals and expectations set out in these forward-looking statements. The Company undertakes no obligation to change these statements to reflect actual results. This document does not contain a public offer to purchase securities in the US. The securities referred to herein have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States or to US persons. This communication is being distributed only to and is directed only at (a) persons outside the United Kingdom, (b) persons who have professional experience in matters relating to investments, i.e., investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"), and (c) high net worth companies, unincorporated associations and other bodies to whom it may otherwise lawfully be communicated in accordance with Article 49 of the Order (all such persons together being referred to as "relevant persons"). The securities are available only to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be available only to or will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this communication or any of its contents.
ОJSC VEROPHARM CONSOLIDATED INCOME STATEMENT FOR 2013 (in millions of Russian Roubles) 2013 2012 REVENUE 5,269 5,507 COST OF SALES (2,137) (2,389) GROSS PROFIT 3,132 3,118 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (2,094) (1,669) OPERARING PROFIT 1,038 1,449 INTEREST EXPENSE/(INCOME) 32 (94) FOREIGN CURRENCY EXCHANGE GAIN/(LOSS) (142) 38 PROFIT BEFORE INCOME TAX 928 1,393 INCOME TAX EXPENSE (316) (229) PROFIT FOR THE YEAR 612 1,164
ОJSC VEROPHARM CONSOLIDATED BALANCE SHEET AT 31 DECEMBER 2013 (in millions of Russian Roubles) 31.12.2013 31.12.2012 ASSETS NON-CURRENT ASSETS: Property, plant & equipment 5,137 2,345 Goodwill 287 287 Intangible assets 444 96 Total non-current assets 5,868 2,728 CURRENT ASSETS: Inventories 957 643 Trade receivables 3,773 4,514 Other receivables and prepaid expenses 2,677 3,276 Loans receivable 0 - Cash and cash equivalents 48 308 Total current assets 7,455 8,741 TOTAL ASSETS 13,323 11,469 EQUITY AND LIABILITIES EQUITY: Share capital 10 10 Reserves 1 1 Retained earnings 9,097 8,433 Total equity 9,108 8,444 NON-CURRENT LIABILITIES: Long-term borrowings 1,547 1,025 Deferred tax liabilities, net 244 1 Total non-current liabilities 1,791 1,026 CURRENT LIABILITIES: Short-term borrowings 1,120 471 Trade payables 913 652 Other payables and accrued expenses 266 786 Taxes payable 125 90 Total current liabilities 2,424 1,999 TOTAL LIABILITIES 4,215 3,025 TOTAL EQUITY AND LIABILITIES 13,323 11,469
OJSC VEROPHARM CONSOLIDATED STATEMENT OF CASH FLOWS FOR 2013 (in millions of Russian Roubles) 2013 2012 OPERATING ACTIVITIES: Profit for the year 612 1,164 Adjustments to profit for the year: Income tax 316 229 Interest expense - 137 Interest income (32) (43) Depreciation and amortization 128 139 Loss on disposal of other intangible assets and property, plant and equipment (3) (3) Change in allowance for doubtful debts (2) (17) Change in inventory obsolescence allowance 50 7 Foreign currency exchange (gain)/loss, net 142 (38) Unused employment benefits - - Profit before movements in working capital 1,211 1,575 Movements in working capital: Increase in inventories (374) 46 Increase in trade receivables 743 671 Decrease/(Increase) in other receivables and prepaid expenses 630 (439) Decrease/(Increase) in trade payables 125 (958) Increase in other payables and taxes payable (463) (397) Cash generated from operations 1,872 498 Interest paid - (137) Interest received - 73 Income taxes paid (42) (132) Net cash generated by operating activities 1,830 302 INVESTING ACTIVITIES: Purchase of property, plant, equipment (2,894) (1,078) Proceeds from disposal of property, plant, equipment 6 6 Purchase of intangible assets (366) (39) Proceeds from repayment of loans given (0) 27 Net cash used in investing activities (3,254) (1,084) FINANCING ACTIVITIES: Proceeds from borrowings 2,691 3,420 Repayment of borrowings and obligations under finance leases (1,521) (2,406) Net cash used in financing activities 1,170 1,014 NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS (254) 232 Effect of exchanges in balance of cash held in foreign currencies (6) - CASH AND CASH EQUIVALENTS, beginning of period 308 80 CASH AND CASH EQUIVALENTS, end of period 48 308