Richter Rises First Day in Seven as Sales Climb: Budapest Mover

Gedeon Richter Nyrt., Hungary’s biggest drugmaker, advanced for the first time in seven days after reporting sales rose in the second-quarter and management kept its forecast for revenue growth.

The stock added as much as 3 percent and closed up 0.3 percent at 3,470 forint in Budapest. The BUX index slid 0.9 percent.

Sales increased 9.5 percent to 92 billion forint ($405 million) in the second-quarter, driven primarily by a boost in exports to Ukraine and strong revenue from China, the company said. “China could become the second-largest drug market as soon as this year or in the next couple of years,” Chief Executive Officer Erik Bogsch told reporters in Budapest today.

Bogsch reiterated a February forecast for group-level sales rising 3 percent in euro terms this year and an operating margin of 14 percent. Management sees as much as 35 million euros ($46 million) in annual sales from China, he said. Ukraine and former Soviet states represent other areas of growth, while U.S. revenue may drop as much as a quarter, Bogsch said.

Net income for the period declined 16 percent to 9.5 billion forint as a result of financial losses on the re-evaluation of foreign-currency loans and trade receivables.

“Richter earnings beat the most optimistic expectations as sales rose to a record high” and profitability showed signs of “stable strengthening,” analysts at Budapest-based brokerage Equilor Zrt. said in an e-mailed note today.

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