Today, on 25 August, the financial statements of the JSC “Grindeks” on the first half-year 2011, submitted to “NASDAQ OMX Riga”, indicate that the net profit of the Group of “Grindeks” (hereinafter – the Group) was 4.26 million lats in the reporting period, which is by 0.16 million lats or 3.9% more in comparison with the first six months of 2010. In its turn, the Group’s turnover during the first half-year 2011 amounted to 32.7 million lats, which is by 0.6 million lats or 1.9% more than in the first half of 2010.

In the first six months of 2011, the gross profit margin of the Group was 59.3%, whereas, the net profit margin comprised 13%. Products of the Group, manufactured during the reporting period, were exported to 46 countries worldwide for the total amount of 31 million lats.

Sales volume of the final dosage forms of “Grindeks” was 27.8 million lats in the first half of 2011, and was maintained at the same level as in the same period last year. The main markets for the final dosage forms are Russia, other CIS countries, Georgia and the Baltic States. The most demanded products of “Grindeks” are the brand product Mildronate®, ointments Capsicam® and Viprosal B®.

In the first six months of 2011, sales of the active pharmaceutical ingredients reached 4.9 million lats, which is by 0.7 million lats or 16.7% more than in the first half of 2010. The main active pharmaceutical ingredient markets for “Grindeks” are Germany, the Netherlands, Japan and the USA. The most demanded pharmaceutical ingredients are UDCA (ursodeoxycholic acid) and oxitocine.

The demand for the active pharmaceutical ingredient zoplicone, developed by our own resources, and the final dosage form manufactured from it – the sedative-hypnotic medication Somnols® – confirms “Grindeks” competence in the vertically integrated solutions.

In June of 2011, an important investment project was concluded and the manufacturing unit of the active pharmaceutical ingredient UDCA was opened, which construction was started in the middle of 2009. 6.34 million lats were invested in the construction of the manufacturing unit, out of which 2.8 million lats were from the European Regional Development Fund (ERDF). It is planned that the newly established UDCA manufacturing unit will significantly raise the turnover of “Grindeks”. When UDCA manufacturing unit will work at full capacity, UDCA turnover will rise to 7 million lats per year. In its turn, after the development and registration of the final dosage form in the next 2-3 years, sales could grow by another 7 million lats per year.
“Grindeks” has started establishment of the manufacturing unit for ethanol-based gels and ointments. The new production unit is located in the territory of the company in Riga, 53 Krustpils street. The total planned investment of the project – 1.28 million lats. Thanks to the new manufacturing unit, the company’s product range will be extended with ethanol-based gels and ointments. For the establishment of the manufacturing unit the necessary equipment for smelting, manufacture and packaging will be purchased and it will ensure output up to 20 million units (tubes) per year.

Chairman of the Board of “Grindeks” Janis Romanovskis: “The major event for “Grindeks” in the first half-year was the opening of the new UDCA manufacturing unit. This achievement diversifies “Grindeks” business activities and expands the company’s product portfolio in the completely new therapeutic group of medications for the company – gastrointestinal diseases. Project confirms the company’s high expertise and increases competitiveness in the international arena. Intense competition in the pharmaceutical market is the driving force for implementation of sustainable solutions and promotion of business results.”

On “Grindeks”

“Grindeks” is the leading pharmaceutical company in the Baltic States. Its main fields of action are research, development, manufacturing and sale of original products, generics and active pharmaceutical ingredients. The Group consists of four subsidiary companies in Latvia, Estonia and Russia; representative offices in ten countries.

“Grindeks” specializes in the heart and cardiovascular, CNS and anti-cancer medication therapeutic groups. The company`s product range consists of the combination of successful original products and generics,- it includes the original products Mildronate® and Ftorafur®, as well as more than 100 forms of effective and safe generics. Currently, “Grindeks” produces 16 active pharmaceutical ingredients.

Products of the company are exported to 50 countries and its export comprises more than 95% of the total turnover. The main sales markets are Russia and other CIS countries, the Baltic States, Germany and the Netherlands. In 2010, “Grindeks”, receiving the highest award from the Ministry of Economics of Latvia and the Latvian Investment and Development Agency, was recognized as the leading exporter of Latvia.

In order to increase production capacity and improve infrastructure, the company in recent years has implemented a series of large-scale investment projects, investing in the development 32.7 million lats within five years.

JSC “Grindeks” shares are listed in the Official List of “NASDAQ OMX Riga”. The major shareholders of the JSC “Grindeks” are Kirovs Lipmans – 33.29%, Anna Lipmane – 16.69%, “Skandinaviska Enskilda Banken” – 12.42%, “AB.LV Private Equity fund 2010” – 11.38%, “Swedbank” AS Clients Account – 6.87%.

Further information on the company – www.grindeks.lv

Further information:
Laila Klavina
Head of the Communications Department
JSC “Grindeks”
Phones: (+371) 67083370, (+371) 29256012
Fax: (+371) 67083505
E-mail: laila.klavina@grindeks.lv