Huons recorded its best performance ever in the second quarter this year.
The company released its second-quarter performance in a public filing Tuesday.
On a consolidated basis, Huons reported second-quarter revenue of 140.7 billion won ($106.5 million), operating income of 17.9 billion won, and net income of 14.9 billion. These marked increases of 13.4 percent, 64.5 percent, and 98.2 percent year-on-year, marking the record-high quarterly results ever.
Huons attributed its excellent performance to prioritizing profitability, expanding exports, and strengthening substantial internal operations.
According to the company, its specialty pharmaceuticals business drove growth in the second quarter. Specialty pharmaceuticals posted sales of 66.3 billion won, up 32 percent. Prescription drug sales across anesthetics, cardiovascular, antibiotics, and anti-inflammatory drugs grew evenly.
Notably, exports of anesthetics to the U.S. reached 7.1 billion won, up 108 percent. Four products that have received FDA’s ANDA (Abbreviated New Drug Application) approval, including lidocaine local anesthetic, continued to grow, posting sales of 12.7 billion won in the first half of the year, exceeding last year's annual sales of 12.3 billion won.
Its beauty-wellness business unit posted sales of 49.4 billion won, up 9 percent. The health functional food business recorded sales of 20 billion won, the highest ever, thanks to the launch of new products, Menolacto Premium and a prostate-strengthener. The contract manufacturing organization (CMO) business continued its solid performance with sales of 16.8 billion won.
Operating profit was 17.9 billion won, with an operating margin of 12.7 percent. Profitability increased significantly thanks to expanding exports of pharmaceuticals, increasing online sales of health functional products, and subsidiaries' turnaround to profits. For instance, Huons Foods returned to profitability with sales of 10.6 billion won in the second quarter amid a higher capacity utilization rate.
The company plans to continue its growth in the year's second half. To strengthen the competitiveness of exported injections in North America, it expanded the lineup of exported medicines by obtaining an additional FDA’s ANDA for 2-percent lidocaine (vial) in the U.S. and 1-percent lidocaine (vial, ampoule) in Canada.
The company said it is also diversifying sales channels by launching new health-functional food products making the most of individualized ingredients, and expanding online sales.
Huons is also accelerating the development of new drugs for dry eye syndrome. In June, it submitted a phase 1 investigational new drug (IND) application for HUC-1 394 (FPR2 Selective peptide ligand). It is also in phase 3 for HUC2-007, a compound eye drop that combines cyclosporine and trehalose to minimize side effects.
"Despite the difficult economic conditions at home and abroad this year, we could show record-high performance in the second quarter based on our strategy to expand global exports," CEO Song Soo-young said. "We will continue to strive to expand our global market and lead sustainable growth based on innovation and internal management, as well as proactive responses to turn crises into opportunities."
Huons has decided to pay an interim dividend for the first time in its history. The interim dividend is 300 won per share and will be paid on May 25. In February, the company announced its mid- to long-term shareholder return policy, stating it would increase its dividend per share by 0-30 percent from the previous business year.