The Mayne Pharma Group Ltd (ASX: MYX) share price is one to watch this morning after reporting its latest full-year results.
Why is the Mayne Pharma share price on watch?
The Aussie pharma group reported revenue down 13% on FY19 to $457.0 million for the year ended 30 June 2020 (FY20).
Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) fell 27% to $95.3 million.
That saw Mayne Pharma reported a net loss after tax of $92.8 million. That was still a 66.7% improvement on FY19 figures even accounting for a $99.0 million impairment.
The pharma company reduced operating expenses by $16 million to optimise global infrastructure with a $15 million reduction in product development spend.
Net operating cash flow was up 16% on the first-half but down 6% for the year to $99.8 million.
On the operations side, there were some important updates that make the Mayne Pharma share price worth watching.
The company’s generic products division stabilised in the second half. Sales were down 21% on FY19 to $253 million, however, gross profit was up 10% on the first half.
Metrics contracts services delivered solid revenue growth, up 15% on FY19 to $82.8 million. That saw gross profit climb 11% to $39.4 million with 5 commercial manufacturing clients now locked in.
The speciality brands division saw sales slump 14% to $78.8 million with gross profit down 18% to $65.4 million. The coronavirus pandemic hurt the business segment with fewer patient visits to doctors.
Positively, Mayne Pharma International sales were up 4% on FY19 to $42.4 million with gross profit flat at $11.0 million.
What did management have to say?
CEO Scott Richards noted the “unprecedented challenges” in dealing with COVID-19. The company focused on maintaining an uninterrupted supply of medicines and services during the second half.
That saw the half-year revenue flat on 1H FY20 numbers with net operating cash flow climbing 16% higher in the last 6 months.
The pharma group is looking to restructure its cost base, rationalise its generic portfolio and explore new areas of growth.
The Mayne Pharma share price will be one to watch in early trade as investors weigh up the latest strategy.
That includes completing the licensing of its NEXTSTELLIS product in the United States and Australia having received FDA filing acceptance for the novel contraceptive product.
The group also expects to commence a phase 3 trial in basal cell carcinoma nevus syndrome (BCCNS or Gorlin Syndrome) patients in FY21.
There was no specific guidance provided by Mayne Pharma other than reiterating its near-term goals.
That included repositioning the company into “sustainable products, distribution channels and therapeutic areas.”
Prior to the open, the Mayne Pharma share price was down 22.2% for the year versus an 8.5% decline in the S&P/ASX 200 Index (ASX: XJO).