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Dear Shareholders,
I write to
you, in these very challenging and exciting days
of your company. The Year 2006 has been a year
of change, retrospection and revitalization for
the organization. It has been a year of new
beginning, initiatives and investments, a year
of great success, coupled with enhanced
efficiency and effectiveness. We have started
our Journey towards a greater tomorrow, a bigger
and more efficient Julphar and towards achieving
our objective of self-sufficiency in Medicines
for the nation and region.
The year had an eventful beginning with the
European Health Regulatory Authority accrediting
the company and its quality standards, a further
proof to your company's growing international
recognition. The response to the first rights
issues of the series as decided in the previous
years AGM has been a resounding success, thanks
to your confidence and patronage to our efforts.
The operational margins grew at healthy rate of
36.5%, reaching AED 103 Million as against 74
Million for the year 2005. During the year
Julphar achieved sales growth of 12.6%,
registering total sales of AED 613 million.
Operational
results in 2006 have been encouraging and we
forecast another tremendous year 2007. However,
in contrast to the FY 2005, the stock markets in
the UAE and the entire Middle East faced huge
selling and liquidity pressures, resulting in
negative growth in stock valuation. This was the
single factor that has affected the bottom-line
of your organization. The company achieved
consolidated profit of
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AED 67 Million for the FY 2006.
Even though the company's fundamentals are
strong, the stock stayed undervalued. We are
hopeful that the market will rebound and by
virtue of which Julphar shares will receive
their deserved valuation. I take this
opportunity to assure the shareholders that your
company is in excellent healthy trend. I believe
the Company's continued efforts and the
management's drive to achieve optimum
operational efficiencies will keep up the good
work done.
In the FY 2006, the company has
started construction of its new manufacturing
plants in UAE. The company has invested in new
antibiotic powder filling plant and Ointment
plant at its GPI Premises. These investments are
estimated to contribute another 30% gradually to
the company's top line and bottom line. The
company has also initiated investment and work
on its very prestigious Insulin Manufacturing
unit, meeting global standards, using state of
the art machinery and equipment. The company is
fully aware that the future of the
pharmaceutical industry is biotechnology and
hence we have put in place a mechanism that will
make Julphar the region's leading
biotechnological medicine manufacturer in the
coming 2-3 years.
Also during the current financial year, the
company made 190 registrations in various
markets as against 170 during the PY. It has
commenced its marketing operations in
strategically important markets of Pakistan and
South Africa. Even though the company has not
been able to match PY net profit, you may note
that the company's performance has been one of
the best it ever had in terms of sales and
operating results. I reiterate that the coming
FY 2007 and the subsequent years will witness
period of value creation.
The Arab Pharmaceuticals market is estimated at
$ 8 Billion and is expected to grow annually, by
industry experts, at an estimated CAGR of 10% to
11% for the next 5-7 years. We at Julphar want
to play a very important role in this region,
that of a leader and not a follower. We know
that we will face big challenges on this path
but we are prepared to face any and all
challenges and we are determined to reach our
goals, either short-term or long-term.
With all the new projects the company is
initiating and investing, I am sure of its
continued growth and leadership in the entire
Middle East.
Thank you for your faith and continued support
to the company.
Abdul Razzaq Yousef
Chief Executive Officer |
