Sopharma’s Q2’20 net profit declines 2.1% on impairment of trade loans to subsidiaries (NEUTRAL)
Source: Sopharma; FFBH
Sopharma’s Q2’19 sales grew 5.9% YoY (in line with the preliminary announcement) to BGN 51.6m. Exports surged 33.6% to BGN 40.1m while domestic sales dropped 39.2% to BGN 11.2m. Total revenues were up 5.2% to BGN 53.3m. EBITDA grew by 19.3% to BGN 11.3m as cost of materials declined. Net financial income was down 25.6% mainly on the BGN 3.5m impairment of trade loans. As a result, net profit was down 2.1% YoY to BGN 8.7m (EPS of BGN 0.09).
H1’20 revenue added 0.7% to BGN 105.2m while EBITDA declined by 5.2% to BGN 24.9m as most costs increased at higher than the revenue pace. Net financial income was also down by 34.8% on the same reason as in Q2 alone, bringing net income drop to 17.9% (EPS of BGN 0.16).
On the balance sheet, non-cash working capital increased by BGN 34.8m over H1’20 on higher growth of receivables and inventories while IB debt declined by BGN 9.5m to BGN 10.3m (IB debt to equity of 19.3%). Long-term receivables declined in the last quarter as it seems that Doverie [5DOV] has repaid BGN 34m of its loan from Sopharma. CAPEX amounted to BGN 8.6m.