The CLINUVEL Pharmaceuticals Limited (ASX: CUV) share price is sinking lower on Wednesday following the release of its half year results.
The biopharmaceutical company's shares are currently down 7% to $21.58.
How did CLINUVEL perform in the first half?
For the six months ended December 31, CLINUVEL delivered an 11% increase in total revenue to $9.97 million. A key driver of this growth was the sales of its SCENESSE product in the European market.
SCENESSE is used for the prevention of phototoxicity in adult patients with erythropoietic protoporphyria. Late last year the product finally received approval by the U.S. FDA.
In light of this approval, the company has invested heavily in key areas of the business to support its growing activities. This led to a sizeable 54% increase in expenses compared to the prior corresponding period. Which ultimately led to CLINUVEL reporting a 74% decline in net profit after tax to $1.06 million.
At the end of the period the company had cash of $57.4 million and no debt on its balance sheet.
Manangement commentary.
CLINUVEL's chief financial officer, Darren Keamy, was pleased with the company's performance in the first half.
He said: "The eighth consecutive half year profit is a timed and well-managed outcome as it has been sustained in a period where the Group further re-invested in the business which, as expected, had an effect on the net profit result. We had long planned to establish cash reserves to accommodate for any economic downturns, allowing CLINUVEL to execute its plans without significant concerns about building a promising business."
"As part of our long-term plans, growth in the existing revenue base from distribution of SCENESSE in the Eurozone has enabled the Group to self-finance its growth which include expansion into the US. In balancing the entry into new territories, diffusion in new medical indications and control over our costs, we continue to progress the strategic initiatives set by the Board for long term performance of the Group," he added.
No guidance was provided for the second half.
