Samsung BioLogics touts big operating profit

Samsung BioLogics’ operating profit surged 65 percent in 2019, thanks to increased operating rates at its three plants and a drop in the won’s value, the company said Wednesday.

The biopharmaceutical affiliate of Samsung Group also grew revenue by 30.9 percent in 2019, to 701.6 billion won ($602 million) from 535.8 billion won a year earlier, the company announced in a statement.

During the same period, its operating profit added 64.6 percent on-year to reach 91.7 billion won, while net profit was down 9.5 percent from a year earlier, at 202.9 billion won. As a result, the company’s aggregate debt fell 8.1 percent to 15.6 trillion won.

Samsung BioLogics credited the successful year to the enhanced operating rates of its three plants. The rates rose through the end of the fourth quarter, after finishing the necessary biennial maintenance period for biopharmaceuticals manufacturing plants, which temporarily drops their operating rates.

The company, founded in 2011, specializes in contract development and manufacturing organization (CDMO) services with its three bio manufacturing plants in Songdo, Incheon, which entails developing drugs and manufacturing request volumes of biological products from its clients. The company is also at the moment working on enhancing its contract research organization (CRO) services.

In the fourth quarter, the company’s sales revenue added 69.5 percent from a quarter earlier to 313.3 billion won, as it recovered the operating rate at its second factory. During the same period, operating profit increased 353 percent from the previous quarter, reaching 106.9 billion won.

Samsung BioLogics has returned its annual sales and profits to black territory, having reported net profit for two consecutive years in 2018 and 2019. The company said it is pursuing more contract manufacturing organization (CMO) and contract development organization (CDO) contracts from foreign companies.

Speaking at the J.P. Morgan Healthcare Conference last week, Samsung BioLogics CEO Kim Tae-han announced the company’s first foreign expansion, a CDO research and development facility it is planning to build in April near San Francisco.

With strong yearly results, Samsung BioLogics gained 3.2 percent to 452,000 won by Wednesday’s close.

BY KO JUN-TAE [ko.juntae@joongang.co.kr]