ANZAG with improved results in the 2010 financial year
01.12.2010 14:57
Sales and EBIT above the previous year / foreign investments have been an important success factor for years
Andreae-Noris Zahn AG (ANZAG), one of the leading German pharmaceutical wholesalers, increased group sales by 7 % to 4.2 billion euros in the 2010 financial year. Earnings before interest and taxes (EBIT) increased from EUR 35.0 million to EUR 54.4 million.
In addition to the growth of the German wholesale market, the positive development in ANZAG's foreign business contributed to the increase in earnings. “ANZAG’s internationalization strategy has proven to be the right one in economically difficult times,” explains Dr. Thomas Trümper, CEO of ANZAG, at the annual press conference in Frankfurt. “We have secured valuable market positions with relatively small investments in growth markets. But at the same time, with a return on sales of 0.72 %, we are still well away from the level of earnings that we as a trading company would need in order to be able to manage the risks of our business and continue to invest in increasing our performance.”
Market environment in the 2010 financial year
In the ANZAG financial year 2010 (September 1, 2009 to August 31, 2010), the German pharmaceutical market once again grew faster than the overall economy. Sales at selling prices of pharmaceutical companies increased by 4.0 %. The decisive factor was the demand for high-priced, innovative medicines, for example for the treatment of cancer. With a 6.2 % increase in sales, the wholesale market grew significantly above the pharmaceutical market for the first time in many years. What was crucial for this development was that the 15th Amendment 2 of the Medicines Act enshrined the public supply mandate and the wholesaler's legal right to supply from the industry.
As a result, pharmaceutical wholesale sales of prescription preparations increased significantly, by 7.9 %. The pharmaceutical markets in Romania, Croatia and Lithuania, in which ANZAG is present with corporate investments, have developed differently: The Romanian pharmaceutical market continued to grow by 16 % in local currency in the first half of 2010. In Croatia, the pharmaceutical market decreased by 3.7 % in the first half of 2010. The Lithuanian pharmaceutical market fell by 4.0 % in the first six months of 2010.
Sales and earnings improved
The group's sales revenue increased by 7 % to 4.2 billion euros. The gross profit margin improved slightly to 6.46 %. The foreign companies grew disproportionately in sales by around 25 million euros. Earnings before interest and taxes (EBIT) amount to EUR 54.4 million compared to EUR 35.0 million in the previous year. The earnings contribution of the fully consolidated foreign subsidiaries increased from EUR 9.2 million to EUR 15.8 million compared to the previous year.
The number of employees in the group (full-time employees excluding trainees) has increased from 2,635 to 2,697 since the last reporting date. In Romania in particular, the number of employees continued to increase due to the expansion of business activities. The number of trainees at ANZAG remained almost constant at 119 compared to 120 in the previous year.
Outlook 2011
ANZAG expects moderate growth in its foreign markets for the 2011 financial year. A market growth of 3 % is expected in Germany. Accordingly, sales in the group are expected to increase to almost 4.4 billion euros. However, ANZAG assumes that earnings in the next two years will be below the level of the 2010 financial year. In particular, the law to reorganize the 3 pharmaceutical market (AMNOG), which was passed in the Bundestag in mid-November 2010, will have a negative impact. “Everyone in the market – especially politicians – is aware that wholesale does not generate sufficient income to be able to meet the savings planned in AMNOG,” says Trümper. With a total income of all full-service wholesalers amounting to 172 million euros in 2009, it is inevitable that charges will have to be passed on to the pharmacies. “We at ANZAG consider this development to be regrettable. Despite the growing cost pressure, there is one thing we should not forget: We, the pharmaceutical wholesalers and the pharmacies, are all in the same boat.”