Hemas Group to invest Rs. 2 b for new pharmaceutical plant

Monday, 20 February 2017 00:45 - - {{hitsCtrl.values.hits}}

Subsidiary J.L. Morison venture at SLINTEC Nano Tech Part to commence operations in 2019

Hemas Holdings Plc is stepping up moves to harness higher growth in the booming healthcare industry with a group investment of $ 13.5 million (over Rs. 2 billion) to put up a new pharmaceutical manufacturing plant.

Hemas’ subsidiary J.L. Morison Son and Jones (Ceylon) Plc said its Board of Directors resolved to construct the plant focusing on research and manufacturing within the SLINTEC Nano Technology Park in Pitipana, Homagama.

“The proposed plant will significantly enhance the manufacturing capacity of the company while complying with global regulatory standards,” J.L. Morison said.

Commercial operations are expected to commence in 2019.

In the first nine months of the 2016/17 financial year, J. L. Morison posted a YoY growth of 6% and operating profit growth of 1.3%. Hemas Holdings CEO Steven Enderby said the Rx Pharma portfolio continued to do well benefiting from new product launches.

“We continue to focus more on new product launches to increase our manufacturing presence in Sri Lanka and have exited from the agricultural supply operations which have been part of J. L. Morison for many years,” he added. As a result, underlying revenue excluding agricultural operations grew by 15.1% and EBIT by 11.8%.

Hemas Holdings’ consolidated healthcare sector revenue in the first nine months grew by 17% to Rs. Rs. 14 billion. Operating profit and earnings grew at 14.6% and 13.5%, to achieve Rs. 1.5 billion and Rs. 964 million respectively.

However, during the third quarter, Hemas’ healthcare sector experienced challenges arising from new pharmaceutical price regulation and the introduction of VAT on specified hospital services. Hemas pharmaceutical distribution operation recorded a solid performance over last year with increased volume growth.

Hemas hospitals also delivered good growth over the last year with its latest investments in bed expansion in Hemas Hospital Wattala and a range of new surgical specialties and medical equipment.

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