TIDMHIK

RNS Number : 2242W

Hikma Pharmaceuticals Plc

15 April 2019

Hikma Pharmaceuticals PLC

(the 'Company')

Publication of 2018 Annual Report and Notice of AGM

LEI: 549300BNS685UXH4JI75

The Company will today publish on its website, www.hikma.com, the Annual Report for the year ended

31 December 2018 (the '2018 Annual Report').

Hard copy versions of the following documents will be sent to those shareholders who have elected to receive paper communication on or about 15 April 2019:

   --      2018 Annual Report 
   --      2019 Notice of Annual General Meeting 
   --      Proxy form for the 2019 Annual General Meeting 

Shareholders who have not elected to receive paper communication will be sent communications notifying them of the availability of these documents on the Company's website.

In compliance with Listing Rule 9.6.1 of the UK Financial Conduct Authority ('FCA'), the aforementioned documents will be submitted to the UK Listing Authority and will be available for public inspection at the National Storage Mechanism ('NSM') www.morningstar.co.uk/uk/NSM

The Company's Annual General Meeting will be held at 10:00 am on Friday 17 May 2019 at Sofitel,

St James, 6 Waterloo Place, London SW14 4AN.

The information included in the unaudited preliminary results announcement released on 13 March 2018, together with the information in the Appendices to this announcement which is extracted from the 2018 Annual Report, constitute the materials required by the FCA's Disclosure Guidance and Transparency Rule 6.3.5R. This announcement is not a substitute for reading the 2018 Annual Report in full. Page and note references in the Appendices below refer to page and note references in the 2018 Annual Report.

Enquiries:

Hikma Pharmaceuticals PLC

 
 Peter Speirs 
 Company Secretary 
 

15 April 2019

Appendix 1 - Principal Risks and Uncertainties

The Group faces risks and uncertainties that could have a material impact on its earnings and ability to trade in the future. These are determined via robust assessment considering our risk context by the Board of Directors with input from executive management. These risks and uncertainties are set out below. The contents of this table should not be considered as an exhaustive list of all the risks and uncertainties the Group faces.

The Board is satisfied that these risks are being managed appropriately and consistently with the target risk appetite.

 
 Risk and description           Mitigating actions 
 Industry earnings 
 The commercial viability 
  of the industry                 *    Securing key talent to manage complex commercial 
  and business model                   environment and develop our business 
  we operate may change 
  significantly as 
  a result of political           *    Growth and expansion in existing markets with new 
  action,                              products and in new therapeutic areas 
  economic factors, 
  societal pressures, 
  regulatory interventions        *    Portfolio management programmes to focus on strategic 
  or changes to participants           products that support revenue, profit and margin 
  in the value chain                   targets 
  of the industry. 
 
                                  *    Development of capacity and diversification of 
                                       capability through differentiated technology 
 
 
                                  *    Capital investment in the countries in which we 
                                       operate to ensure continued market access 
 
 
                                  *    Active product life cycle and pricing management 
 
 
                                  *    Continuous alignment of commercial and R&D 
                                       organisations to identify market opportunities and 
                                       meet demand through internal portfolio 
 
 
                                  *    Collaboration with external partners for development 
                                       and in-licensing partnerships 
                               ------------------------------------------------------------- 
 Product pipeline 
 Identifying, developing 
  and registering                 *    Align selection process for pipeline products to 
  new products that                    ensure optimal use of our expansive global product 
  meet market needs                    portfolio with increased focus on specialty products 
  to provide continuous                with high value and differentiation 
  source of future 
  growth. 
                                  *    Strategic oversight of pipeline delivery through 
                                       dedicated global project management office 
 
 
                                  *    Product-related acquisitions to bolster pipeline 
 
 
                                  *    Third-party pharmaceutical product specialists 
                                       brought in to assist in the development of 
                                       manufacturing processes for new generic products 
                               ------------------------------------------------------------- 
 Organisational development 
 Developing, maintaining 
  and adapting organisational     *    Strengthening teams with key talent appointed to fill 
  structures, management               strategic regional and global positions 
  processes and controls, 
  and talent pipeline 
  to                              *    Deployment of Group-wide human capital management 
  enable effective                     system 
  delivery by the 
  business in the 
  face of rapid and               *    Developing global programmes that attract, manage and 
  constant internal                    develop talent within the organisation 
  and external change. 
 
                                  *    Ongoing updates to organisation design, structures 
                                       and accountabilities to maintain empowerment in 
                                       decision-making and bring appropriate level of 
                                       governance 
                               ------------------------------------------------------------- 
 
 
 Reputation 
 Building and maintaining 
  trusting and successful       *    Internal and external monitoring of issues that may 
  partnerships with                  impact reputation 
  our many stakeholders 
  relies on developing 
  and sustaining                *    Increasing investment in corporate social 
  our reputation                     responsibility initiatives including sustainability 
  as one of our most                 reporting 
  valuable assets. 
 
                                *    Establishment and development of strategic industry 
                                     and community partnerships 
 
 
                                *    Communication and engagement programmes on 
                                     appropriate use of products 
 
 
                                *    Strengthening communication and corporate affairs 
                                     capabilities in our core geographies 
                             ------------------------------------------------------------- 
 Ethics and compliance 
 Maintaining a culture 
  underpinned by                *    Board level oversight from the Compliance, 
  ethical decision-making,           Responsibility and Ethics Committee (see pages 79 and 
  with appropriate                   80 for details) 
  internal controls 
  to ensure staff 
  and third parties             *    Code of Conduct approved by the Board, translated 
  comply with our                    into seven languages and rolled out to all staff 
  Code of Conduct, 
  associated principles 
  and standards,                *    Active participation in international anti-corruption 
  as well as all                     initiatives 
  applicable legislation. 
 
                                *    Anti-bribery and corruption, sales and marketing, and 
                                     other compliance programmes implemented and monitored 
                                     through internal compliance assessments 
 
 
                                *    Implementation of third-party due diligence and 
                                     oversight programme 
                             ------------------------------------------------------------- 
 Information, technology and infrastructure 
 Ensuring integrity, 
  confidentiality               *    IT organisational structure designed to enable 
  and resilience                     coordinated, consistent and comprehensive enterprise 
  of data, securing                  approach 
  information stored 
  and/or processed 
  internally or externally,     *    Industry-standard information security solutions and 
  maintaining and                    best practice processes adopted and adapted for local 
  developing technology              and Group requirements 
  systems that enable 
  business processes, 
  and in ensuring               *    Cyber-risk activity monitored and changes implemented 
  infrastructure                     as necessary to combat evolving threats 
  supports the organisation 
  effectively. 
                                *    Partnership established with strategic third parties 
                                     to implement and maintain a robust 
 
 
                                *    Group-wide information security framework 
 
 
                                *    Investment in enterprise-wide standardisation 
                                     initiative incorporating data management, access and 
                                     process control, and risk management 
                             ------------------------------------------------------------- 
 
 
 Legal, regulatory and intellectual property 
 Adapting to changes 
  in laws, regulations             *    Continuous assessment of developments in legal and 
  and their application,                regulatory frameworks and impact on the organisation 
  managing litigation, 
  governmental investigations, 
  sanctions, contractual           *    Internal communication and training on policies and 
  terms and conditions,                 processes drives awareness and understanding and 
  and potential business                builds a compliance culture 
  disruptions. 
 
                                   *    External advice procured to provide independent 
                                        services and ensure highest standards 
 
 
                                   *    Strengthened experience and capability for managing 
                                        intellectual property matters 
                                ------------------------------------------------------------ 
 Inorganic growth 
 Identifying, accurately 
  pricing and/or realising         *    Extensive due diligence of each acquisition in 
  expected benefits from                partnership with external support, including 
  acquisitions or divestments,          financial and legal advisers, investment banks, and 
  licensing, or other                   industry specialists in order to strategically 
  business development                  identify, value, and execute transactions 
  activities. 
 
                                   *    Executive Committee review of major acquisitions 
                                        before they are considered by the Board 
 
 
                                   *    The Board spends a significant amount of time 
                                        reviewing major acquisitions to ensure strategic 
                                        alignment 
 
 
                                   *    Dedicated integration project teams led by the 
                                        business head responsible 
 
 
                                   *    Post-acquisition performance (financial and 
                                        non-financial) monitored closely to ensure 
                                        integration and delivery on business plan 
 
 
                                   *    Post-transaction reviews highlight opportunities to 
                                        improve effectiveness of processes 
                                ------------------------------------------------------------ 
 Supply chain and active pharmaceutical ingredient (API) sourcing 
 Maintaining continuity 
  of supply of finished            *    Continuity of API supply maintained for high-value 
  product and                           products through alternative API suppliers, stocking 
  managing cost, quality                strategies, and supply chain modelling 
  and appropriate oversight 
  of third parties 
  in our supply chain.             *    Rigorous selection process for API suppliers and 
                                        focus on building long-term supply contracts 
 
 
                                   *    Vertically integrated plant in Jordan to synthesise 
                                        selected strategic injectable APIs 
 
 
                                   *    Strengthening trade compliance capability to ensure 
                                        compliance and drive efficiency 
 
 
                                   *    Programmes rolled out across the Group to ensure 
                                        compliance with serialisation requirements for US, 
                                        Europe and MENA 
                                ------------------------------------------------------------ 
 
 
 Crisis response and continuity management 
 Preparedness, response, 
  continuity and recovery          *    Continued strengthening of central oversight of 
  from crisis events,                   systems, processes, and capabilities to enhance our 
  such as natural catastrophe,          Group-wide resilience and crisis preparedness 
  economic turmoil, 
  operational issues, 
  political crisis,                *    Updated crisis management framework to enhance our 
  and regulatory intervention.          ability to respond effectively to crises, and to 
                                        expedite the restoration of critical processes after 
                                        disruption 
 
 
                                   *    Identified key third parties involved in preparedness, 
                                        response and recovery with updated framework 
 
 
                                   *    Corporate insurance programme aligned to ensure 
                                        appropriate coverage of high-impact, low-likelihood 
                                        events 
                                -------------------------------------------------------------- 
 Product quality and safety 
 Maintaining compliance 
  with current Good                *    Quality culture driven throughout the organisation by 
  Practices for                         global quality initiatives, and regularly reinforced 
  Manufacturing (cGMP),                 by communication from senior executives 
  Laboratory (cGLP), 
  Distribution (cGDP) 
  and Pharmacovigilance            *    Global implementation of quality systems that ensure 
  (cGVP) by staff,                      valid consistent manufacturing processes leading to 
  and ensuring                          the production of quality products 
  compliance is maintained 
  by all relevant third 
  parties involved                 *    Facilities maintained as inspection-ready for 
  in these processes.                   assessment by relevant regulators 
 
 
                                   *    Documented procedures continuously improved and 
                                        regular staff training 
 
 
                                   *    Continued environment and health certifications 
 
 
                                   *    Global pharmacovigilance programme in place 
                                -------------------------------------------------------------- 
 Financial control and reporting 
 Effectively managing 
  treasury activities,             *    Extensive financial control procedures implemented 
  tax position, income,                 and assessed annually as part of the financial 
  expenditure, assets                   compliance monitoring programme 
  and liabilities, 
  and debtors, and 
  reporting accurately             *    Network of banking partners maintained for lending 
  and in a timely manner                and deposits 
  in compliance with 
  statutory requirements 
  and accounting standards.        *    Management monitors debtor payments and takes 
                                        precautionary measures and action where necessary 
 
 
                                   *    Selected hedging of exchange rate and interest rate 
                                        exposure 
 
 
                                   *    External advice to help manage tax exposures and 
                                        upgraded internal tax control systems 
                                -------------------------------------------------------------- 
 

Appendix 2 - Directors' Responsibility Statement

Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable laws and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have prepared the group financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting

Standards, comprising FRS 101 "Reduced Disclosure Framework", and applicable law). In preparing the group financial statements, the directors have also elected to comply with IFRSs, issued by the International Accounting Standards Board (IASB). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the

group and company and of the profit or loss of the group and company for that period. In preparing the financial statements, the directors are required to:

   --      select suitable accounting policies and then apply them consistently 

-- state whether applicable IFRSs as adopted by the European Union and IFRSs issued by IASB have been followed for the group financial statements and United Kingdom Accounting Standards, comprising FRS 101, have been followed for the company financial statements, subject to any material departures disclosed and explained in the financial statements

   --      make judgements and accounting estimates that are reasonable and prudent 

-- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and company will continue in business

The directors are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for keeping adequate accounting recordsthat are sufficient to show and explain the group and company's transactions and disclose with reasonable accuracy at any time the

financial position of the group and company and enable them to ensure that the financial statements and the Directors' Remuneration Report comply with the Companies Act 2006 and, as regards the group financial statements, Article 4 of the IAS Regulation.

The directors are responsible for the maintenance and integrity of the company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from

legislation in other jurisdictions.

We confirm to the best of our knowledge:

-- the financial statements, prepared in accordance with International Financial Reporting Standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of Hikma and the undertakings included in the consolidation taken as a whole

-- the Strategic report includes a fair review of the development and performance of the business and the position of Hikma and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face

-- the Annual Report and financial statements, taken as a whole, are fair, balanced and understandable and provide the information necessary for shareholders to assess Hikma's performance, business model and strategy

By order of the Board

Said Darwazah

Executive Chairman

12 March 2019

Sigurdur Olafsson

Chief Executive Officer

12 March 2019

Appendix 3 - Related Party Transactions

Related party transactions: Note 40 of the financial statements, page 162.

Transactions between Hikma and its subsidiaries (together, the Group) have been eliminated on consolidation and are not disclosed in this note. Transactions between the Group and its associates, joint ventures and other related parties are disclosed below.

Trading transactions:

During the year ended 31 December 2018, the Group entered into the following transactions with related parties:

Boehringer Ingelheim GmbH ('BI'): is a related party of Hikma because BI owns 16.6% (2017: 16.6%) of the share capital of Hikma, controls 11.8% (2017: 11.8%) of the voting capital of Hikma, has the right to appoint a director of Hikma and a senior executive of BI holds a directorship of Hikma. The Group total sales to BI amounted to $66.6 million (2017: $79.1 million) and the Group total purchases from BI amounted to $5.1 million (2017: $10.6 million). As at the year end, the amount owed from BI to the Group was $18.1 million (2017: $43.8 million). Additionally, balances arising from the acquisition of the Columbus business from BI relating to contingent consideration are disclosed in notes 24, 28 and 32.

Capital Bank, Jordan: is a related party of Hikma because one director of Hikma is the founder and former Chief Executive Officer of Capital Bank. At the year end, total cash balance at Capital Bank was $7.5 million (2017: $11.8 million) and utilisation of facilities granted by Capital Bank to the Group amounted to $nil (2017: $nil). The interest income is within the market range.

Darhold Limited ('Darhold'): is a related party of Hikma because three directors of Hikma jointly constitute the majority of directors and shareholders (with immediate family members) in Darhold and because Darhold owns 24.85% (2017: 24.93%) of the share and voting capital of Hikma. Other than dividends (as paid to all shareholders), there were no transactions between the Group and Darhold Limited during the year.

Hikmacure Limited ('Hikmacure'): is a related party of Hikma because Hikmacure is a 50:50 joint venture (JV) with MIDROC Pharmaceuticals Limited (MIDROC). Hikma and MIDROC have invested in Hikmacure in equal proportions of $2.5 million each in cash (2017: $2.5 million). During 2017, Hikma and MIDROC agreed not to proceed with and to liquidate the venture.

HMS Holdings SAL ('HMS): is a related party of Hikma because HMS is owned by the family of two directors of Hikma. Other than dividends (as paid to all shareholders), there were no transactions between the Group and HMS during the year.

Hubei Haosun Pharmaceutical Co. Ltd ('Haosun'): is a related party of Hikma because the Group holds a 49.0% interest in the joint venture (JV) with Haosun (2017: 30.1%). During 2018, total purchases from Haosun were $2.3 million (2017: $1.4 million). At 31 December 2018, the amount owed from Haosun to the Group amounted to $0.2 million (2017: $1.6 million). During the year Hikma acquired an additional stake in Haosun bringing the total ownership to 49.0% (note 18).

Labatec Pharma ('Labatec'): is a related party of the Group because Labatec is owned by the family of two directors of Hikma. During 2018, total Group sales to Labatec amounted to $2.9 million (2017: $1.8 million). As at the year end, the amount owed by Labatec to the Group was $0.3 million (2017: $0.3 million).

Remuneration of key management personnel

The remuneration of the key management personnel (comprising the Executive and Non-Executive Directors and certain of senior management as set out in the Directors' report) of the Group is set out below in aggregate for each of the categories specified in IAS 24 'Related Party Disclosures'. Further information about the remuneration of the individual Directors is provided in the audited part of the Remuneration Committee report on pages 81 to 104.

 
                                 2018   2017 
                                   $m     $m 
 Short-term employee benefits    17.4   11.0 
                                -----  ----- 
 Share-based payments               8   10.2 
                                -----  ----- 
 Post-employment benefits         0.1   10.3 
                                -----  ----- 
 Other benefits                   0.8    0.6 
                                -----  ----- 
                                 26.3   32.1 
                                -----  ----- 
 

About Hikma

Hikma helps put better health within reach every day for millions of people in more than 50 countries around the world. For more than 40 years, we've been creating high-quality medicines and making them accessible to the people who need them. Headquartered in the UK, we're a global company with a local presence across the United States (US), the Middle East and North Africa (MENA) and Europe, and we use our unique insight and expertise to transform cutting-edge science into innovative solutions that transform people's lives. We're committed to our customers, and the people they care for, and by thinking creatively and acting practically, we provide them with a broad range of branded and non-branded generic medicines. Together, our 8,400 colleagues are helping to shape a healthier world that enriches all our communities. We are a leading licensing partner in the MENA region, and through our venture capital arm, are helping bring innovative health technologies to people around the world. For more information, please visit www.hikma.com.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

ACSSFSFFIFUSEFL

(END) Dow Jones Newswires

April 15, 2019 07:23 ET (11:23 GMT)

Grafico Azioni Hikma Pharmaceuticals (LSE:HIK)
Storico
Da Feb 2024 a Mar 2024 Clicca qui per i Grafici di Hikma Pharmaceuticals
Grafico Azioni Hikma Pharmaceuticals (LSE:HIK)
Storico
Da Mar 2023 a Mar 2024 Clicca qui per i Grafici di Hikma Pharmaceuticals