The shares declined 6.2 percent, the most since April 2009, to 288 rand by the close yesterday in Johannesburg, paring the gain this year to 7.2 percent. The FTSE/JSE Africa All Share Index has advanced 9.5 percent in 2014.
“The company guided for a softer second half in South Africa because of government tender volumes that were lower than anticipated,” Mathew Menezes, an analyst at Johannesburg-based Avior Research who was on the call, said by phone yesterday. Aspen also reported a “disappointing second half in South America because of problems with the supply chain.”
Aspen supplies medicines in more than 150 countries and last year bought injectable thrombosis brands, including a manufacturing site and inventory, from London-based GlaxoSmithKline Plc for 700 million pounds ($1.2 billion). The company’s second half runs through June 30.
Chief Executive Officer Stephen Saad was “as surprised as anyone” by the share price fall, he said by mobile-phone yesterday. “It was a normal trading update. I didn’t see it being very different from what the analysts had projected. If there was anything that we deemed to be problematic we would have put out a cautionary” statement.
Greg Lan, a director for Aspen Asia Pacific (Pty) Ltd, sold 24,479 shares for 7.6 million rand ($716,000), Aspen said in a statement yesterday. Trevor Ziman, another director at the same unit, sold 12,000 units for 3.7 million rand.
Aspen’s South Africa unit “had a disappointingly lower second half,” Deputy Chief Executive Officer Gus Attridge said on the conference call, a recording of which has been heard by Bloomberg News. “The anti-retroviral tender values have been significantly down on expectations. This has not only affected revenue but impacted on margins.”
Media were not invited to listen to the call. A number is provided on the website of the company that enables a caller to listen to a recording.
In South America, the company had “supply difficulty” concerning products made by Merck & Co. Inc. (MRK), Attridge said. Aspen bought a manufacturing unit from the U.S. drugmaker and took an option to purchase a products business in a $1 billion deal last year.
Menezes said he considered the setbacks to be “temporary” and that the company’s long-term prospects were good.
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