Wednesday, April 6, 2011

CCM ... Apr11

Sources say US-based GlaxoSmithKline Pharmaceuticals plc (GSK) is eyeing a controlling equity stake in local generic drugs maker CCM Duopharma Biotech Bhd.

The source said the acquisition was in line with the trend in the global pharmaceutical industry, in which large players were scouting for takeover targets in emerging markets, as more expiring patents on drugs were generating a significant portion of their earnings.

CCM Duopharma is the largest generic drug maker in Malaysia. This could possibly bode well for GSK in the long run.

In Dec 2010, GSK proposed to take over Maxinutrition Group Holdings Ltd, a UK company that manufactures protein-enhanced functional nutrition products from Darwin Private Equity for £162 million (RM789 million) in cash, including the debt repayment. Its president John Clarke once said the acquisition was a “demonstration of GSK’s strategy to expand through appropriate bolt-on acquisitions that meet its strict
financial criteria”.

The world’s largest drug maker Pfizer Inc had in October last year announced its acquisition of Tennessee-based King Pharmaceuticals Inc for US$3.6 billion (RM11 billion) so that it could offer a fuller spectrum of treatments for patients across the globe who are in need of pain relief and management. Pfizer was paying a 40% premium for the acquisition. CCM Duopharma’s present undemanding valuation could possibly meet GSK’s criteria.

CCM Duopharma is hardly traded on Bursa Malaysia. One reason could be the company’s shares are tightly held. CCM Marketing Sdn Bhd, wholly owned subsidiary of Chemical Company of Malaysia Bhd (CCM), owns 73.37% shareholding in the company.

CMM’s net assets stood at per share of RM1.13 as at Dec 31, 2010.
CCM Duopharma and its parent company CCM said they had “no knowledge of any such move”.

Whether GSK is indeed buying CCM Duopharma remains unconfirmed observers pointed out that while the potential divestment of the controlling stake in CCM Duopharma could help CCM pare down its large debts, but the sales would also create a vacuum in the group’s earnings portfolio.

For FY10 ended Dec 31, CCM has total borrowings of RM836.5 million, consisting of long-term borrowings of RM311.7 million and short-term debts of RM524.8 million, against a cash balance of RM210 million. This translates into a net debt of RM626.5 million.

CCM’s net gearing stood at a high of nearly 85%, based on shareholders’ fund of RM740.76 million.

On the flip side, the disposal of the equity stake in CCM Duopharma would mean a loss of a steady income stream.

For FY10, pharmaceutical division is not the biggest contributor to CCM’s revenue, but it is the second most profitable one after chemicals division. Pharmaceutical business generated RM50 million to CCM’s revenue and RM21.6 million to the group’s pre-tax profit.

Furthermore, CCM Duopharma is rather generous in terms of dividend payment. For FY10, the company paid a total dividend of RM20.48 million, according to its cashflow statement.

Holding 73.37% in the generic drug manufacturer, CCM is expected to receive dividend income of RM15million. The amount will be handy for CCM to pay for about half of CCM’s net interest expense of RM32.2 million for the year.

Unlike its parent, CCM Duopharma has a clean balance sheet that allows the company to be generous in dividend payment.

It had a net cash of RM4.58 million as at Dec 31, 2010, comprising RM10.42 million in long-term borrowings, RM8.33 million in short-term borrowings and RM23.33 million cash.

For FY10, CCM Duopharma’s revenue totaled RM131.44 million, up 6.2% from RM123.8 million from the previous fiscal year while net profit amounted RM28.7 million, marginally lower against RM30.2 million the year before.

CCM Duopharma’s financial performance remains relatively resilient. For the past five years between 2005 and 2009, the company posted a compounded annual growth rate of 5.7% and 4.43% in revenue and earnings per share, respectively.

CCM could be possibly giving up one precious gem if it were to sell CCM Duopharma.

60 comments:

Anonymous said...

generic xanax xanax no prescription overnight - valium xanax side effects

Anonymous said...

generic xanax xanax overdose renal failure - can buy xanax vietnam

Anonymous said...

xanax online xanax on drug test time - xanax and alcohol combo

Anonymous said...

xanax online xanax 3rd trimester - can i order xanax online

Anonymous said...

buy tramadol online tramadol for dogs forum - tramadol 50mg vs lortab

Anonymous said...

generic xanax buy xanax london - buy xanax yahoo

Anonymous said...

buy carisoprodol carisoprodol 350 mg what is it used for - carisoprodol dosage maximum

Anonymous said...

order tramadol online tramadol 100 mg sandoz - non generic tramadol

Anonymous said...

carisoprodol 350 mg does carisoprodol 350 mg contain aspirin - order carisoprodol online no prescription

Anonymous said...

generic xanax xanax effects baby - xanax withdrawal vertigo

Anonymous said...

carisoprodol buy carisoprodol blood pressure - high on carisoprodol

Anonymous said...

buy tramadol online tramadol hcl 50mg side effects in dogs - tramadol 50 mg and xanax

Anonymous said...

buy cialis online buy brand name cialis online - cialis online ricetta

Anonymous said...

buy tramadol buy tramadol pay with mastercard - tramadol yahoo answers

Anonymous said...

buy cialis online cialis 10mg cost - cialis daily use does work

Anonymous said...

buy xanax online blue xanax pills generic - buy xanax online us

Anonymous said...

buy cialis online cialis street price - cialis 5mg. price in usa

Anonymous said...

buy cialis online cialis bathtub symbolism - generic cialis fast delivery

Anonymous said...

cialis online cialis versus levitra - buy cialis discount online

Anonymous said...

xanax online order xanax overnight - xanax generic 0.5

Anonymous said...

buy cialis 10mg buy cialis south africa - cialis 0.5

Anonymous said...

cialis pharmacy price quote+cialis - order cialis online no prescription usa

Anonymous said...

xanax online xanax withdrawal symptoms mayo clinic - xanax for social anxiety blushing

Anonymous said...

cialis online generic cialis legitimate - compare generic cialis price

Anonymous said...

cialis online generic cialis online us - buy cialis online safely

Anonymous said...

buy tramadol tramadol addiction risk - signs of tramadol addiction

Anonymous said...

buy tramadol tramadol 50 mg max dosage - tramadol first time dosage

Anonymous said...

buy tramadol buy tramadol online no prescription cheap - tramadol used get high

Anonymous said...

buy tramadol tramadol overdose quantity - tramadol 100 mg get you high

Anonymous said...

buy tramadol cod next day delivery buy tramadol dogs online - long does 50mg tramadol take kick

Anonymous said...

http://buytramadolonlinecool.com/#59473 cheap tramadol eu - online us pharmacy no prescription tramadol

Anonymous said...

legal buy tramadol online tramadol with no prescription needed - get high tramadol 50mg

Anonymous said...

buy tramadol tramadol for purchase no prescription - buy tramadol for dogs online

Anonymous said...

tramadol cheap tramadol dosage australia - buy tramadol online usa

Anonymous said...

http://landvoicelearning.com/#30896 tramadol dosage australia - tramadol 50 mg generic

Anonymous said...

buy tramadol ultram 50 mg tablet - tramadol fass 100mg

Anonymous said...

learn how to buy tramdadol buy tramadol online free shipping - what is tramadol addiction

Anonymous said...

buy tramadol buy tramadol online for dogs - tramadol recreational dose

Anonymous said...

http://buytramadolonlinecool.com/#51726 purchase tramadol dogs - illegal to buy tramadol online

Anonymous said...

buy tramadol tramadol for dogs side effects - buy tramadol online no prescription next day delivery

Anonymous said...

ways to buy ativan online lorazepam 1 mg kern pharma - ativan online no prescription needed

Anonymous said...

buy tramadol no prescription overnight tramadol dosage humans weight - buy tramadol usa

Anonymous said...

buy ativan online where to buy ativan online in canada - ativan withdrawal youtube

Anonymous said...

ways to buy ativan online side effects to lorazepam 1mg - ativan side effects frequency

Anonymous said...

Үour currеnt аrtiсle provides eѕtablisheԁ uѕeful
tо us. It’ѕ reаlly useful and you're certainly very well-informed in this area. You possess exposed my own sight in order to numerous thoughts about this particular matter together with intriguing, notable and reliable written content.
Also see my webpage > Xanax

Anonymous said...

buy ativan online generic name for ativan - ativan dosage geriatrics

Anonymous said...

http://reidmoody.com/#53287 ativan valium alcohol withdrawal - lorazepam 1 mg efectos secundarios

Anonymous said...

buy tramadol online tramadol hcl 50 mg para que sirve - buy tramadol online cod overnight

Anonymous said...

http://staam.org/#56274 taking 5 50 mg tramadol - tramadol trade name generic name

Anonymous said...

http://staam.org/#92453 buy tramadol online overnight cod - buy tramadol legally

Anonymous said...

buy tramadol online best place order tramadol online - ultram side effects itching

Anonymous said...

buy tramadol online tramadol hcl 20mg - tramadol addiction does

Anonymous said...

buy tramadol online tramadol buy overnight - tramadol online for cheap

Anonymous said...

buy xanax online xanax drug narcotic - upjohn generic xanax

Anonymous said...

buy tramadol online buy tramadol usa - trusted online pharmacy tramadol

Anonymous said...

buy xanax online xanax side effects appetite - generic xanax no imprint

Anonymous said...

buy xanax online cheap xanax home drug test - xanax dosage highest

Anonymous said...

buy xanax online enhance xanax high - xanax 1 mg buy online

Anonymous said...

buy cheap xanax xanax zolarem 1mg - high on xanax bars

Blogger said...

eToro is the most recommended forex trading platform for rookie and established traders.