South African drugmaker Aspen Pharmacare Holdings said on Wednesday full-year core normalised earnings fell by 4% due to a lower contribution from its manufacturing business and it will not pay a dividend this year.
Normalised earnings before interest, tax, depreciation and amortisation (Ebitda) declined to R10.8-billion from a restated R11.2-billion, the firm said in a statement. The figure is in constant exchange rates.
Aspen, which also operates in Europe, trimmed debt to R39-billion from R53.5-billion, thanks mostly to cash proceeds from disposal of its infant formula business and a portfolio of products distributed in Asia Pacific in the second half.
The leverage ratio, which assesses the ability of a firm to meet its financial obligations, ended at 3.62x, "comfortably" below the covenant threshold of 4.0x.
Investors have been concerned about Aspen's rising debt for about a year, when levels moved close to breaching debt covenants.
Normalised headline earnings per share (NHEPS) from continuing operations fell by 8% to R14.14 from a restated R15.36. In reported rates, NHEPS fell by 7%.
Aspen did not declare an annual dividend, saying it has taken into account its prioritisation of deleveraging the balance sheet, existing debt service commitments during the 2020 financial year and the short-term requirements of the ongoing capital projects.