Last close As at 05/08/2026
NZD4.75
▲ −0.03 (−0.63%)
Market capitalisation
NZD499m
Research: Healthcare
AFT Pharmaceuticals has released a trading update ahead of its H125 results, expecting to report a c NZ$2m operating loss for the period ending September 2024, driven by one-off factors affecting the top line, as well as increased investments in expanding its international footprint. While the domestic Australian and New Zealand (ANZ) market continued to perform well (double-digit growth), stocking rationalisation by certain international customers, a doctors strike in South Korea (a key market for Maxigesic IV, which drove 57% y-o-y revenue growth in Asia in FY24) and higher sales and marketing expenses weighed on margins. Management expects the sales momentum to pick up in H2, a traditionally stronger period for AFT, although previous FY25 guidance (operating profit of NZ$22–25m) is likely to be revised, reflecting the H1 results. We await the full results on 21 November, before updating our estimates.
AFT Pharmaceuticals |
H125 profitability weighed down by one-offs |
Trading update |
Pharma and biotech |
4 November 2024 |
Share price performance
Business description
Analysts
AFT Pharmaceuticals is a research client of Edison Investment Research Limited |
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AFT Pharmaceuticals has released a trading update ahead of its H125 results, expecting to report a c NZ$2m operating loss for the period ending September 2024, driven by one-off factors affecting the top line, as well as increased investments in expanding its international footprint. While the domestic Australian and New Zealand (ANZ) market continued to perform well (double-digit growth), stocking rationalisation by certain international customers, a doctors strike in South Korea (a key market for Maxigesic IV, which drove 57% y-o-y revenue growth in Asia in FY24) and higher sales and marketing expenses weighed on margins. Management expects the sales momentum to pick up in H2, a traditionally stronger period for AFT, although previous FY25 guidance (operating profit of NZ$22–25m) is likely to be revised, reflecting the H1 results. We await the full results on 21 November, before updating our estimates.
Year end |
Revenue (NZ$m) |
PBT* |
EPS* |
DPS |
P/E |
Yield |
03/23 |
156.6 |
16.7 |
11.0 |
1.10 |
26.0 |
0.4 |
03/24 |
195.4 |
23.0 |
15.8 |
1.60 |
18.1 |
0.6 |
03/25e |
232.4 |
23.6 |
16.5 |
1.65 |
17.3 |
0.6 |
03/26e |
278.3 |
40.8 |
28.3 |
2.83 |
10.1 |
1.0 |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items, and share-based payments.
The expected c NZ$2m operating loss in H125 will be AFT’s first in five years and was driven by largely non-recurring factors. These include softer sales in Asia and international markets (as outlined above) and lower licensing income (c NZ$2m received in H124 from AFT’s Italian licensee). Management highlighted that domestic market performance remained strong, partially offsetting the decline in international sales, which is encouraging given that ANZ still contributes over 80% of AFT’s sales. H125 margins were also affected by continued investments in expanding AFT’s international presence (business hubs established in the UK, US, Canada, South Africa and Asia in the past year) and product portfolio beyond Maxigesic, supporting increased sales traction in the medium-to-long term.
Given AFT’s seasonality, we expect a stronger H225, as the second half of the financial year has historically contributed 73–87% of full-year operating profit for the company over the past four years, although full-year guidance may be revised to reflect H1 results. We await the full results before updating our estimates.
Despite the H125 operating performance, we continue to see upside optionality from AFT’s internationalisation and R&D efforts. With Maxigesic IV launched in the US and out-licensed in China (the top two pharmaceutical markets globally) and Crystaderm primed for launch in China in Q4 CY24, we expect increased international sales momentum. We also expect AFT’s continued R&D focus to likely drive long-term value. The company has several R&D programmes in development, including the recently announced Phase III development programme for an undisclosed injectable medicine (a patented new chemical entity) in partnership with a European player. The agreement is conditional on a positive FDA and European Medicines Agency meeting (before 31 March 2025) and we expect further updates in the coming months.
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Research: Investment Companies
Molten Ventures released its trading update for H125 (ending September 2024), expecting a c 3% NAV per share decline versus end-March 2024 to 644p, mostly due to c £30m negative foreign exchange effects (2% of opening gross portfolio value). As discussed in our September update note, Molten experienced a significant pick-up in exit activity, and collected £76m in cash proceeds in H125. Molten also announced that Martin Davis will step down after five years as the company’s CEO and will be succeeded with immediate effect by Ben Wilkinson, who has been Molten’s CFO for the last eight years. Andrew Zimmermann (finance director) will be appointed interim CFO. We also note that Molten’s shares re-entered the UK flagship top 250 index in the period. The shares now trade at a c 47% discount to NAV.