PharmaZen Builds For The Future On Back Of Record Surplus

Media Release

March 28, 2013

PharmaZen Builds For The Future On Back Of Record Surplus

Backed by strong demand for its product range and increased profitability, even against a soaring dollar, biotechnology company PharmaZen has commenced an ambitious building programme.

Despite the dollar, and now well over interruptions caused by the earthquakes, in the 12 months ending December 31, 2012, PharmaZen reported a record surplus before tax of $537,108 on turnover of $6,685,972. This compares with a before tax surplus of $485,958 on turnover of $6,602,187 for the prior period.

PharmaZen Chief Executive, Craig McIntosh, said that the building programme was only a part of why the company was looking forward with confidence to the next 12 months.

“One of the pleasing aspects about the year was that the company was able to achieve this record result without any sacrifices in terms of the ongoing
commitment to research and development and capital investment.

“Indeed, 2012 saw an acceleration of initiatives with some major milestones achieved on the back of just under $900,000 invested into capital projects,
$697,000 coming from the strong operating cash flow,” he said.

The multifaceted development programme included;

• The installation of a cogeneration unit enabling the plant to run without mains power connection.
• Commencement of building expansion and site development.
• Completion of two major research projects.
• Design and validation of an extraction plant.
• A commitment of $1.6 million to site development and construction of a new building to accommodate expanded dry-side production.

“The two research projects completed in 2012 at The University of Auckland were undertaken in response to a large body of research demonstrating the link between calcium supplementation and increased risk of heart attacks.

“Both projects were of an academically high standard and provided very positive results,” he said.

The first project looked at the impact of a modified release calcium on serum calcium levels, while the second project looked at selective protein fractions and their ability to promote new bone formation.
“In order to obtain maximum value from this research, the decision was made to hold off any promotional activities until the findings have been published in peer reviewed medical journals, probably in the middle of this year.

“While this does delay the release of the new product, it is considered worthwhile since published results offer a far more valuable marketing tool. Even without undertaking any marketing we have received significant expressions of interest from key customers..

“Collectively these projects look set to provide significant growth opportunities for the Company while at the same time providing a stronger foundation through the strengthening of our intellectual property portfolio and manufacturing capabilities,” he said.

The AGM will be held at the clubhouse, Otago Golf Club, 24 Balmacewen Road, Dunedin, on May 2, 2013

Footnote:
Shares in PharmaZen, which supplies animal and health products, are traded through the Unlisted securities trading platform.

ENDS

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