Roger Mächler Chief Financial Officer
Strong performance and continued investments in research and infrastructure to provide more medicines to patients in need.
Over the last six years, the Octapharma Group has accomplished a remarkable compound annual growth rate of 15% and reports another record-breaking result for 2017, with sales of €1.72 billion – €120 million (7.5%) more than 2016’s figure (on a constant currency basis, the growth rate is 9.4%). All our products performed well, especially wilate® and Nuwiq®. The company’s continued strong and balanced sales growth would not be possible without effective collaboration across all divisions and regions, and the focus and commitment of all its employees and business partners.
Gross profit in 2017 is €592 million, €2 million higher than in 2016. Despite the €120 million increase in revenue, the 34.4% gross margin is 2.5 percentage points lower than last year. The relatively small growth in absolute gross profit is a result of foreign exchange movements and investment in production capacity to fulfil the growing global need for plasma-derived products.
It is in the nature of the plasma protein industry that increasing production capacity does not result in linear profit growth. To ensure each litre of plasma is used to best effect, the company will continue to expand its product portfolio with innovative new products and services, and enter new markets.
Operating income is €349 million. Net cash from operating activities is €353 million (20.5% of revenue). Trade receivables have remained stable despite the significant sales growth and our net inventory has increased by €57 million, to a comfortable holding of raw plasma.
Over the last six years, the Octapharma Group has accomplished a remarkable compound annual growth rate of 15% and reports another record-breaking result for 2017.
Our total operating expenses were €243 million, which includes significant investment in our future product portfolio: €87 million was invested in research and development (R&D) and €201 million in the extension of our production capacity and infrastructure. Much of this fulfils the aims of Program 2019, our development initiative, launched in 2014, to double production capacity and significantly increase the overall efficiency of our manufacturing operations. Investments in people, equipment and property prepare the company for the demands of the future.
In 2018, our target is to achieve a high single-digit sales growth percentage and an absolute operating profit result comparable to 2017.
The significant investment made in research and infrastructure strongly positions Octapharma to fulfil the needs of more healthcare professionals and patients around the world.