Aspen heads for biggest decline in 17 years

Johannesburg - Aspen Pharmacare [JSE:APN] headed for the biggest drop in almost 17 years after the maker of generic drugs said the impact of selling two pharmaceutical portfolios and a one-time currency-related loss in Venezuela would weigh on earnings.

The stock plunged 10% to R326.88 by 09:16 in Johannesburg, on track for the steepest decline since October 1999. That pared the year’s gains to 5.9%, valuing the company at R150bn.

Earnings per share fell by 15% to 20% to as low as R9.12 in the 12 months to end-June, the Durban-based company said in a statement after the market closed on Wednesday. Normalised headline earnings per share, which exclude one-time items, gained as much as 16%. It estimated the currency loss in Venezuela at R870m.

Aspen, which sells products such as hormones, steroids, infant formula and anti-retroviral medicines in more than 150 countries, announced the sale of about 130 drugs to Strides Arcolab.’s Australian business and a portfolio of six branded products to Strides Singapore in May 2015.

“The contribution to the Aspen results by the divestments is consequently substantially reduced in the current period,” the company said.

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