Johnson Chemical Pharmaceutical Works Co (強生化學製藥), which makes generic drugs, said Thursday that it is set to take over a drug company in New Taipei City and invest NT$550 million (US$18.34 million) in renovating the factory for the company, which makes products for overseas markets.
The company plans to raise funds in the capital market for the takeover, company president Huang Po-hsiung (黃柏熊) said at an investors’ conference yesterday.
FACTORY UPGRADE
After the acquisition, the company is to spend NT$400 million on improving the factory buildings, while spending another NT$150 million on purchasing the necessary equipment, Huang said.
“The utilization rate of our current factory has reached 95 percent this year, so we have to find a new production site,” Huang said. The new factory is set to have a larger capacity than its current factory in New Taipei City’s Sanchong District (三重區), he added.
The company has acquired certification for selling its products in the Philippines, and it is in talks with companies around the nation about selling its products starting from the second half of next year, Huang said.
The company started shipping its drugs to Hong Kong and Macau this year, he said.
RISING PROFITS
Johnson Chemical Pharmaceutical Works posted revenue of NT$211.64 million from January through last month, up 20.78 percent from the NT$175.23 million posted for the same period in the previous year, according to the company’s filing to the Taiwan Stock Exchange.
The revenue growth was due to a rise in orders from drugmaker Synpac-Kingdom Pharmaceutical Co (景德製藥), according to the company.
Sales to Synpac-Kingdom accounted for 12 percent of Johnson Chemical Pharmaceutical Works’ revenue in the past seven months, up from 9 percent last year, the company said.
Johnson Chemical Pharmaceutical Works plans to raise sales to Synpac-Kingdom to 22 percent of its revenue in the near future, it said.
The company maintained its target to register a revenue growth of 15 to 20 percent a year this year and in the next two years, it said.
Last quarter, the company reported a profit of NT$19.26 million or NT$0.74 per share, up 29.26 percent from the NT$14.9 million or NT$0.65 per share posted in the same quarter a year ago, and up 7.6 percent from NT$17.9 million or NT$0.78 per share a quarter earlier, the filing said.
HIGHER MARGINS
Huang said products the company sells to Synpac-Kingdom have higher gross margins than its other products, which helps the company’s profit to increase.
The company’s share price rose 0.43 percent to NT$69.50 per share yesterday, outperforming the over-the-counter benchmark index, which was down 0.41 percent.
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