KUALA LUMPUR: Pharmaniaga Holdings Bhd’s net profit jumped 76.3% to RM36.7 million for the fourth quarter of financial year 2014 ended December (4QFY14) from RM20.81 million a year ago, on improved revenue and lower provision for doubtful debts.

Revenue rose 10.4% to RM627.1 million from RM567.86 million in 4QFY13. Earnings per share rose to 14.18 sen from 8.04 sen a year ago.

Pharmaniaga (fundamental: 0.75; valuation: 2.10) also declared a fourth interim dividend of 12 sen per share, payable on March 26. This brings the total dividend for the year to 28 sen per share.

For the full FY14, Pharmaniaga’s net profit surged 70% to RM93.84 million from RM55.2 million in FY13, while revenue rose 9% to RM2.12 billion from RM1.95 billion.

In a statement yesterday, Pharmaniaga said its performance was mainly driven by strong contributions from operations, coupled with consistent growth in manufacturing as well as reduced operating expenses.

Pharmaniaga chairman Tan Sri Lodin Wok Kamaruddin said it had been a strong year for the group.

“The landscape has been particularly challenging this year. Nevertheless, our consistent performance has proven that Pharmaniaga is resilient and will continue to forge ahead,” he said.

“Given the increasing public awareness and greater access to healthcare, we aim to capitalise on and leverage the opportunities driven by the market by expanding our portfolio while maintaining our cost optimisation measures,” he said.

Lodin said Pharmaniaga’s logistics and distribution division recorded a substantial increase of RM40 million in profit before tax (PBT) for FY14, compared with RM21 million achieved in FY13.

He said the division also registered its strongest quarterly performance for the year with a PBT of RM19 million for 4QFY14, marking a threefold increase from RM5 million in 3QFY14.

A higher volume of sales as well as lower provision for doubtful debts drove the upturn, he said.

Lodin said the manufacturing division also delivered a stronger PBT of RM86 million for FY14, compared with RM72 million in FY13 as a result of consistent improved contributions from operations, as well as an increase in average selling price and higher offtake for in-house products from government hospitals.

Going forward, Pharmaniaga remains optimistic about its business prospects for FY15.

“Given the current market trends and demand, the pharmaceutical sector in Malaysia continues to hold much potential for growth opportunities. The group’s logistics and distribution division is expected to improve its performance while focusing on cost optimisation measures to maintain sustained earnings,” it said in a filing with Bursa Malaysia yesterday.

“In line with the group’s business strategy, the manufacturing division will focus on product portfolio expansion and enhancements in its research and development efforts. The division will continue its efforts via the ongoing manufacturing improvement processes, along with collaborations with multinational companies in the European Union (EU) region via the group’s EU-certified plant,” the company said in its filing.

Pharmaniaga also expects a stronger contribution from the manufacturing plant in Indonesia upon the completion of the acquisition and streamlining of activities in the plant.

This article first appeared in The Edge Financial Daily, on February 24, 2015.