AFT Pharmaceuticals - Margins improving

AFT Pharmaceuticals recently reported its H119 results. Operating revenue grew 4.1% compared to H118 and was negatively affected by the divestment of relatively low margin hospital products in New Zealand and Australia. Gross profit, however, grew 24.1% as gross margins improved to 46.7% from 39.1% a year ago thanks to reduced exposure to lower-margin products as well as high growth in the higher margin over-the-counter (OTC) segment. Sales outside of New Zealand and Australia, which are primarily driven by Maxigesic, grew 72.7% and now represent 10.2% of sales compared to 6.1% in H118.