Mona Abdel Raouf, chairperson of the Arab Drug Company for Pharmaceuticals and Chemical Industries (ADCI), said that the expansion plan for the new fiscal year includes developing existing production lines as well as adding new ones, in addition to adding six new products to the company’s existing products, as well as eight products that were already set up but not yet produced.
She added that the company seeks to open new export markets in Arab and African countries, while working to increase sales with current agents in order to obtain foreign currency that can fulfill its dollar needs to import raw materials.
The company is seeking to modify the selling prices of products, especially with the increase of cost elements after the pound flotation, where production inputs of pharmaceuticals mainly depend on imported materials.
Abdel Raouf noted that the company aims to take exports in the new fiscal year to EGP 60m, after having exported products worth EGP 24.2m in 2015/2016. Target exports will include an increase in goods produced exclusively by companies such as those producing aerosols and sprays, where the company aims to achieve EGP 22.9m sales from them, representing 38.2% of the volume of expected exports.
She explained that pharmaceutical companies are still suffering from an increase in foreign exchange rates. It is also struggling with the insistence of exporters of materials, machinery, and production lines to obtain the value in advance before shipping.
Abdel Raouf pointed out that the company has included 63 products in the estimated budget for FY 2016/2017, which will be offered for less than their production costs. They are bound to mark a loss of EGP 36.5m for the company as part of its social responsibility programme.
The chairperson of ADCI said that the company’s work strategy in the new fiscal year will focus on reducing costs and losses without affecting the products’ quality, and with efficient utilisation of all available capacities.
The estimated budget of the company includes achieving revenues of EGP 350m, compared to the EGP 250.2m achieved in FY 2015/2016. The company also expects to achieve distributable net profit worth EGP 18.8m in the new fiscal year, compared to EGP 14.5m in FY 2015/2016.
The estimated budget is targeting investments worth EGP 57.6m from self-financing and the rest from capital increase. The company will continue to develop the pills section as well as add a closed production line for pills.
A plan was set up to develop the section of liquid medications in several phases, with an estimated budget of EGP 7m for the first phase.
The company has contracted to add a new mobilisation line—with a capacity of 7,000 packs per hour—for an estimated amount of EGP 16m to increase production capacity and efficiency.
The new production plan of aerosols and sprays stipulates that they represent 30% of the target sales, which is equivalent to about EGP 105.2m.
ADCI achieved profits worth EGP 6.3m during the quarter ending in December 2016, compared to profits worth EGP 1.7m during the same period of the previous year.
It has also achieved revenues worth EGP 162.2m during the period from July to December 2016, with a 32.6% increase, compared to EGP 122.3m during the same period of 2015.