The Mayne Pharma Group Ltd (ASX: MYX) share price went up 10.5% after it released its FY19 result today.

Mayne Pharma is Australian specialist pharmaceutical company, creating commericialised and generic products you’ll find in pharmacies across Australia. Mayne Pharma’s history started in South Australia. Today, it develops most of its drugs in Australia and the USA.

Mayne’s Pleasing FY19 Report

Mayne reported that its revenue fell by 1% to $525.2 million and reported gross profit increased by 13% to $289.9 million. Mayne said that there was strong growth from its Specialty Brands with sales and gross profit doubling.

During the year it launched two specialty brand products in the US, TOLSURA (SUBA-itraconazole) capsule and LEXETTE (halobetasol) foam and five generic products.

The reported EBITDA (click here to learn what EBITDA means) fell by 4% to $111.6 million, but the adjusted EBITDA dropped 20% to $130.9 million. Its cash flow from operations also worsened by 12% to $106.6 million.

The company reported that its net loss worsened by 110% to $280.8 million, which was due to impairments. Mayne completed a detailed review of its intangible assets taking into account current and projected market dynamics, which resulted in a pre-tax charge of $351.7 million relating to its intangible generic assets.

At the end of the year the company had net debt of $280.4 million.

Mayne Management Comments

Mayne Pharma CEO Scott Richards said: “Whilst the last two years have been extremely challenging for our business due to competitive pressures in the US generic market, we have undertaken a number of actions to better align our business with market realities and focused the business on sustainable categories and channels.

“These changes position Mayne Pharma well for the future to reduce earnings volatility and drive shareholder returns.”

Is The Mayne Share Price A Buy?

Mayne is expecting a stronger result in FY20 and it’s targeting eight new product launches by the end of 2019.

It has fallen a lot over the past three years, perhaps this is the start of a turnaround? I’m not sure about which direction Mayne is heading over the longer term, so I’d rather leave it for other investors. For me, there are easier businesses to evaluate, such as the ones in the free report below.


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Disclaimer: Any information contained in this article is limited to general financial/investment advice only. The information has not taken into account your specific needs, goals or objectives, so please consider consulting a licenced and trusted adviser before acting on the information. Please read The Rask Group’s Financial Services Guide (FSG) for more information. This article is authorised by Owen Raszkiewicz of The Rask Group, which is a corporate authorised representative No. 1264179 of Strawman Pty Ltd (ACN: 610 908 211) (AFSL: 501 223).

At the time of publishing, Jaz does not have a financial interest in any of the companies mentioned.