Strong Growth In 1996 As Medeva Builds In the USA

Sales at Medeva, driven by organic growth and acquisitions, grew 30% in1996 to L331.8 million ($533.85 million). Before a restructuring charge of L65.2 million, operating profits were L105.1 million, up 35%, pretax profits advanced 31% to L103.5 million, and earnings per share were 20.8 pence, up 23%.

The acquisition of Fisons' Rochester site from Rhone-Poulenc Rorer in July was a key event for the group last year. The deal included the rights to a portfolio of 10 products and to the patented Pennkinetic technology. It has also provided Medeva with a focal point for the restructuring of its business in the USA, which represented 69% of sales and 86% of profits in 1996. Bill Bogie, Medeva's chief executive, pointed out that the firm managed to reduce its net debt to L57 million at year-end from L155 million immediately after the Rochester acquisition in July.

The first phase of restructuring is complete. This involved the centralizing of US business operations at the Rochester site, with Medeva's other facilities becoming satellite manufacturing plants. Manufacturing restructuring is expected to take around three years, allowing time for granting of US Food and Drug Administration manufacturing licenses. Dr Bogie explained that in due course certain product lines will be transferred, and the IMS California site will close in two to three years.