Neimeth steps up push for African expansion with new investments

Neimeth steps up push for African expansion with new investments

Neimeth International Pharmaceuticals Plc is intensifying efforts to boost its competitiveness in the African pharmaceutical sector by focusing on the expansion and operational enhancement of its Lagos factory. This strategic shift follows a board decision—approved by the Securities and Exchange Commission (SEC)—to reallocate N1.5 billion initially earmarked for building a new plant in Anambra State toward expanding the existing facility in Lagos.

At the company’s Annual General Meeting in Lagos, Chairman Christopher Oshiafi explained that the redirection was necessitated by inflation and the naira’s depreciation, which made the original project more financially challenging. Instead, the current plan offers immediate benefits and aligns with Neimeth’s broader ambition of becoming a top healthcare provider in Africa. The project is also designed to leverage the African Continental Free Trade Agreement (AfCFTA) and position the firm as a key regional player.

Managing Director Pharm. Valentine Okelu noted that Neimeth has rebounded strongly, becoming one of the fastest-growing pharmaceutical companies on the Nigerian Exchange (NGX) in 2024. According to the company's 2024 audited report, Neimeth recorded major financial improvements:

·       Turnover increased by 103%, from N2.209 billion in 2023 to N4.485 billion in 2024.

·       Gross profit surged by 167%, from N734.07 million to N1.957 billion.

·       Operating profit reversed from a loss of N1.021 billion to a positive N18.886 million.

·       Marketing and distribution expenses dropped 14%, and administrative costs fell 28%, showing strong cost management.

·       However, finance costs rose by 32%, and foreign exchange losses increased by 41%, from N1.459 billion to N2.047 billion.

·       Despite these pressures, pre- and post-tax losses narrowed significantly to N854.434 million and N885.333 million, respectively, down from N1.689 billion and N1.797 billion in 2023.

Shareholders expressed renewed confidence in the company’s trajectory and leadership, optimistic that the return to profitability and dividend payments is near. Investor sentiment has also improved, reflected in a substantial rebound in the company’s share price in 2024. Analysts attributed this to genuine structural improvements and better business fundamentals, not just market speculation.

In summary, Neimeth is undergoing a strategic transformation focused on consolidation, cost-efficiency, and market positioning, with promising signs of recovery and long-term growth.