IDT posts record revenue, profit and dividends

Pharmaceutical manufacturing and drug development company Institute of Drug Technology Australia (ASX:IDT) has reported an operating profit after tax of AUD$4.5 million for the year ended June 30, representing an increase of 5 per cent over the previous year.

Revenue for the period was also up 5 per cent, to $26.9 million for 2004-05 compared with $25.5 million for the previous corresponding year.

The company has declared a fully franked dividend of $0.045 per share, payable on October 21, a 14 per cent increase over last year.

"Record revenue, record profit, record dividends - isn't that terrific?" said IDT's chairman and managing director Graeme Blackman.

Net assets for the company from $27.9 million in 2003-04 to $29.1 million in 2004-05 and capital expenditure increased slightly from $2.7 million for the previous year to $2.9 million.

Blackman attributed the company's performance to a strong level of business, especially in the drug development area.

"Most of our business is for international companies, certainly the majority of our revenue is offshore, but we're certainly happy to continue to work with Australian biotech," he said.

"Australian biotech companies...require a high level of GMP manufacturing capabilities and we're attracting quite a bit of that business," said Blackman.

He also said that CMAX, the company's clinical trial division, continues to grow strongly, with new phase I clinical trial unit expected to open in Mill Park in September which will eventually house 24 beds.

IDT's manufacture of generic active pharmaceutical ingredients (APIs) has reduced in recent years and continued to weaken significantly during this financial year. In 2001, generic APIs represented over 50 per cent ($9.3 million) of the company's revenue but contributed just over 10 per cent of IDT's revenue for the year ending June 2005. At the same time, the company's other revenue increased form $10 million at June 2001 to $23.7 million at June 2005.

"What we're seeing there is an increased off shore competition and we're feeling that effect and we can't match some of those lower prices coming from other markets. So we're having to manage a significant reduction of that component of our business," said Blackman.

Key events for 2004-2005 financial year:

• As well as fee for service development of a novel drug candidate for US-based Pfizer, IDT constructed and validated specialised facilities for the manufacture and testing of a sterile dose form of a Pfizer experimental drug candidate for use in clinical trails;

• The company constructed a new facility at its Boronia site to accommodate a fee for service program for an unnamed US based specialty pharmaceuticals company;

• IDT's facilities to supply thalidomide capsules (Thalomid) for US-based Celgene were approved by the FDA on June 7;

• In June, the company announced that its Adelaide-based CMAX group will be expanding to Melbourne with a phase I clinical trial unit expected to open in September.