The Medical Developments International Ltd (ASX: MVP) share price is on the move today following the release of the company's half-year earnings.
Medical Developments shares were down by as much as 5.72% this morning but have since recovered to be up by 1.29% at the time of writing.
Net profit jumps higher
For the half year ended 31 December 2019, Medical Developments announced an 82% increase in net profit after tax to $240,000. This is up from the $132,000 that it recorded in 1H19.
Meanwhile, gross revenue for the period came in at $11.2 million, up 15% from $9.8 million in the prior corresponding period (pcp). Gross margins remain strong and largely consistent with the prior year at 67%, while earnings before interest, tax, depreciation and amortisation (EBITDA) was up 21% to $1.5 million.
Revenue from the company's Penthrox offering was reported to be continuing to grow strongly with multiple international launches still to occur. To date, Penthrox has launched in-market in the UK and Ireland as well as 15 countries across Europe including France, Belgium, Sweden, and Denmark.
Strong global sales growth
Global gross sales were up 17%, driven by growth within the company's Pharmaceutical and Medical segments.
Medical Developments recorded strong growth in its range of respiratory device sales, driven by the performance of North America which saw a massive 88% jump in sales. Additionally, Australia saw sales growth of 44% in this segment while Europe and the UK sales were up 73%.
Increase in operating expenses
Operating expenses increased 15% during the half year. The company noted that this rise was due to increased "pharmacovigilance" cost as a result of expanding geographic sales for Penthrox and Medical Devices, as well as non-cash share-based payments, non-cash depreciation expenses, and non-cash foreign exchange loss compared to the pcp.
The company also increased its investment in research and development during the period which further weighed down operating expenses.
12-month outlook
Over the next 12 months, the company expects to complete the roll-out of Penthrox into remaining European Union countries, Mexico, Iran, Jordan, South Korea and Thailand.
In addition, Medical Developments plans to consolidate and grow its Respiratory Device sales in the USA, Europe and elsewhere.
