Julphar sales hit by Saudi suspension, slips into red

dubai - Saudi regulator had temporarily suspended imports of drugs from Julphar

Gulf Pharmaceutical Industries, popularly known as Julphar, slipped into red in the third quarter of 2018, posting a loss of Dh76.9 million attributable to owners of the company as compared to Dh31.5 million profit for the same period last year.

The company was hit by a decline in sales which halved to Dh161.1 million in the three-month period because the Saudi Food and Drug Authority had temporarily suspended imports of drugs from Julphar in September after it found a "lack of adherence to the principles of good pharmaceutical manufacturing."

Julphar's auditor, PricewaterhouseCoopers, said in a note published in the full-year results that the company's trade receivables from the Saudi distributor as of September 30, 2018 amounted to Dh579 million, which is included in the interim consolidated statement. Dh243 million in trade receivables is outstanding for more than 2 years.

"Following the temporary suspension on the export of Julphar's products to Saudi Arabia, the company's management has worked extensively with health authorities to address their recommendations and implement corrective measures," it said in a statement on Sunday.

"While we saw a decline in our revenue and profitability due to the headwinds in Saudi Arabia, we continued to work hard on new products launches and building new alliances, which will have a positive impact on our long-term performance," said Jerome Carle, general manager of Julphar.

"We also saw good growth in key areas of our portfolio, especially in diabetes and cardiovascular. Our subsidiaries, led by GCC and Egypt, are also delivering solid performances locally," Carle said.

For the 9-month period, it posted a Dh28.2 million loss as against Dh71.4 million profit attributable to the owners of the company.

Its 9-month profit fell from Dh904 million to Dh718.6 million during the comparative period.

Going forward, Carle said the aim is to transform the company through strategic changes to focus on flexibility and long-term performance.

- waheedabbas@khaleejtimes.com