Hungary's Egis profits up on eastern exports

Wed Nov 14, 2012 12:25pm EST

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BUDAPEST Nov 14 (Reuters) - Hungarian drug maker Egis boosted its profits by 40 percent in annual terms in its fourth quarter, helped by rising exports to former Soviet Union states.

It posted a net profit of 18.79 billion forints ($83.80 million) in the July-September period, while its sales rose 3 percent to 132.8 billion forints, Egis said in its earnings report on Wednesday.

The cost of sales rose by only 0.6 percent, the company said, adding that favourable forint exchange rates in the period also helped its bottom line.

Exports, growing by 6 percent in euro terms from the same quarter of the previous fiscal year, accounted for 78 percent of total sales.

Sales to the group's biggest foreign market, Russia, rose by 5 percent, while sales in Central Europe suffered, falling by 18 percent in Poland and 17 percent in Slovakia, Egis said.

Domestic sales fell 14 percent to 7.37 billion forints as regulatory changes launched last year cut drug prices in Hungary, Egis said.

It said the regulation, which recognizes drug makers' research and development costs, allowed the company to reduce its payments to the state social security by 90 percent or 775 million forints in the fiscal fourth quarter.

Egis shares closed at 16,800 forints, down 2.2 percent. ($1=224.2252 Hungarian forints) (Reporting by Sandor Peto; Editing by Mike Nesbit)

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