Hikma Pharmaceuticals PLC

Good morning and good afternoon, everyone. Thank you very much for joining Hikma's 2023 Full Year Results Q&A. I'm very happy to have Riyadh Mishlawi, Hikma's CEO, on the call today, along with our CFO Khaled Nabilsi, Bill Larkins, the head of our injectables business, Mazen Darwaza, the head of our branded business, and Brian Hoffman, who heads up our generics business. Mazen Darwaza is on the phone, and the rest of us should be on your screen. We are going to have Riyadh give some introductory comments, and then we will open up for Q&A. So I'll hand over now to Riyadh. Thanks, Riyadh.

Thank you, Susan, and thank you everyone for joining us to discuss the 2023 results. Before we get to the Q&A, I would like to give you a few high-level thoughts on our 2023 performance and go a little bit on the 2024 outlook. Let me start by saying I'm extremely pleased with our performance in 2023. We have delivered strong growth in both revenue and core operating profits and core profitability. All three of our business contributed to our growth this year. Let me start with the injectables. Injectables continues to deliver. The revenue was up 6% in 2023, with an impressive and consistent core operating margin to close to 37%, probably one of the highest in the market. We've been busy expanding our portfolio by launching new products and expanding our manufacturing capacity, which is really allowing us to build our presence in the new markets and enhancing our existing market position in both the EU and MENA. It's worth noting that our 503B compounding business is progressing well. Month on month and year on year, we see growth as we build our customer base and portfolio. But we did decide to relocate it to our other segment this year, which will help us ensure a clear focus on its development and investment going forward. The branded division, on the other hand, had a standout performance in 2023, particularly given the headwinds faced from Sudan and the difficulties with the Egyptian currency. This division continued to prove to be resilient. Despite all that, we have continued to build momentum, and I'm excited to report that we are now the second largest pharmaceutical company in MENA region by sales. We continue to focus on high value products used to treat chronic illnesses, which really was a great contributor to bringing our margin above 23% this year. And finally, the generics division, coming from a very tough year in 2022, had an exceptionally strong 2023 year, both in terms of revenue and profitability growth. Our base business saw an easing of the significant price erosion that this business is used to, that especially experienced in 2022, and we have been winning new business across our differentiated portfolio. We also benefited from the launch of our authorized generic of sodium oxidate, which we launched at the start of the year. In addition, we continue to invest in building our specialty business and saw good momentum for Plaxado, our eight milligram Naloxone nasal spray. Finally, to move on to the outlook of 2024, we're confident that 2024 will be another year of progress. And we're guiding to 4% to 6% group revenue growth and $660 million to $700 million group core EBIT. This introduction of a simplified group guidance is new for this year. As a CEO, I focus more than ever on collaborations between the three businesses, sharing best practices and leveraging our commercial strengths, our new capabilities, engineering expertise, and everything that we can really collaborate on for the benefit of the group overall. As a leadership team, we are focused on group performance. And by adding this to our guidance, we're highlighting the strengths of Hikma as a group rather than some of its three parts. So with that, let's get started with Q&A.

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