^1ĚýĚý The Group assesses its operational performance using constant exchange rates (“CER”). The table above compares performance to the prior comparable period at reported exchange rates and at CER.
² Ěý The CER percentage change is based upon the performance for the six months ended 30 June 2024 recalculated using the average exchange rates for the year ended 30 June 2025.
³ Ěý Operating profit before depreciation and amortisation adjusted for specific non-trading items as defined in the Group’s accounting policy.
⁴ Ěý Normalised headline earnings per share (“NHEPS”) is headline earnings per share (“HEPS”) adjusted for specific non-trading items as defined in the Group’s accounting policy.

⁵ Ěý Dividend declared on 3 September 2025, to be paid on 6 October 2025 (2024: Declared on 3 September 2024 and paid on 23 September 2024).

Ěý

SEGMENTAL PERFORMANCE

Commercial Pharmaceuticals

Commercial Pharmaceuticals delivered solid revenue growth of 5% (10% CER) to R32 216 million and normalised EBITDA growth of 1% (10% CER) with CER EBITDA growth well aligned to CER revenue growth despite absorbing proportionately higher operating expenses in the business acquired from Sandoz in China. Organic revenue growth of 7% CER was achieved when excluding the portfolio acquired in Latin America. Gross profit margins of 58,1% (FY 2024: 59,4%) were diluted by lower Injectables gross profit margins and the relative strength of the average ZAR exchange rates against Aspen’s major trading currencies.

Ěý

Prescription

Prescription Brands reported growth of 10% (16% CER), with revenue of R12 519 million. Americas led the growth, benefitting from the full year addition of the portfolio acquired in Latin America which enjoyed double digit growth on a comparable basis in H2 2025. Africa Middle East, the largest region within this segment, grew 8% with solid organic growth of 6% augmented by the Lilly franchise. Gross profit percentage of 61,8% (FY 2024: 60,9%) was supported by a favourable sales mix from Americas.

Ěý

OTC

OTC revenue grew by 1% (5% CER) to R9 812 million buoyed by an expected stronger second half performance from Africa Middle East which recorded full year growth of 5% (6% CER). The Australasia OTC portfolio revenue, which grew 5% in CER, now exceeds the region’s Prescription segment and is well positioned for future growth. Gross profit percentage of 58,3% was closely aligned to the prior period (FY 2024: 58,7%).

Ěý

Injectables

The Injectables portfolio returned to growth in FY 2025 rising 4% (10% CER) to R9 885 million. Africa Middle East growth of 45% was boosted by the successful launch and rollout of Mounjaro® in South Africa. The product swop transaction with Sandoz impacted Asia positively and Europe negatively. Gross profit percentage declined to 53,2% (FY 2024: 58,2%) influenced by the impact of national volume-based procurement and related one-off inventory write-offs in China.

Manufacturing

Manufacturing revenue of R11 147 million ended 21% lower (-19% CER). Reduced revenue from Heparin was the main cause of this decline as the business benefitted from high once-off sales in the prior year due to the transition to a working capital light toll model. Normalised EBITDA of R668 million in CER ended 62% lower than the prior year impacted mainly by the Dispute within the Finished Dose Form (“FDF”) segment.

Ěý

PROSPECTS

Aspen is focused on optimisation strategies for its Manufacturing business and building on the gains made in Commercial Pharmaceuticals.

For FY 2026, Commercial Pharmaceuticals is expected to record mid-single digit organic revenue and stronger EBITDA growth in CER. This will be supported by a higher profit contribution from the reshaped business in China and further incremental growth from Mounjaro® in South Africa following the recent regulatory approval of the Kwikpen® delivery system indicated for type 2 diabetes management and pending approval of the chronic weight management indication. Aspen has also recently concluded a long-term distribution and promotional agreement with Boehringer Ingelheim for its product portfolio in South Africa, effective from 1 September 2025.

Ěý

Considerable progress has been made in executing on Aspen’s generic semaglutide GLP-1 strategy (sterile injectable products for the treatment of type 2 diabetes and obesity). This has required extensive investment in both intellectual property (“IP”) and infrastructure. To give the Group every chance of success, Aspen has followed a strategy of both developing its own IP and licensing/partnering on IP with licensors.

It is anticipated that the first revenue from this initiative could be as early as the latter part of FY 2026. No such revenue has been included in the Commercial Pharmaceuticals guidance detailed above.

Ěý

The FDF segment of the Manufacturing business is working to recover lost profitability by FY 2027. Key to achieving this objective is:

• Commercialising the insulin contract, following an intensive technical transfer process. This is an exciting opportunity for both ĚÇĐÄvlog and patients. Resultant revenue of R0,3 billion is forecast for FY 2026, ramping up to more than R1 billion for FY 2027; and
• Reshaping both Aspen’s French and South African sterile facilities to match resources with the existing contracts on hand. It is intended that most of the restructuring will be addressed in this calendar year.

The benefits of both increased revenue and cost reductions will positively impact H2 2026 and are expected to be fully realised in FY 2027.

Ěý

Aspen is well positioned to execute on its strategic opportunities that will further enhance Manufacturing profitability which include, inter alia:

• Procuring regulatory approval from SAHPRA and WHO for the Serum paediatric vaccines, to be followed by commercialisation with potential sales in calendar year 2026 and increased volumes thereafter;
• On-boarding GLP-1 injectable production volumes at both the French and South African sterile facilities following the operationalisation of Aspen’s generic semaglutide strategy; and
• Securing further contracts in the South African and French sterile facilities.

Ěý

The Group anticipates double digit CER growth in normalised headline earnings in FY 2026. Manufacturing normalised EBITDA was positively impacted by the contribution from the mRNA contract in H1 2025 but negatively impacted by the reversal of a portion of this contribution in H2 2025 following the onset of the Dispute. Consequently, the relative CER normalised headline earnings are expected to be lower in H1 2026 followed by stronger double-digit growth in H2 2026.

Ěý

The continued focus on working capital, enhanced Manufacturing efficiencies and expected lower investment in capital expenditure (following higher GLP-1 and sterile related investments in FY 2025) should assist the Group in reducing net debt levels and achieving an operating cash conversion rate target of greater than 100% in FY 2026. The Group expects to achieve a leverage ratio of less than 3.0x at the end of FY 2026.

Ěý

Any forecast information in the above-mentioned paragraphs has not been reviewed or reported on by the Group’s auditors and is the responsibility of the directors.

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DECLARATION OF DIVIDEND

The Board has declared a gross dividend of 211 cents per ordinary share (2024: 359 cents per share) (or 168,8 cents net of a 20% dividend withholding tax, where this maximum rate of tax applies) which is 20% of normalised headline earnings per share and aligned to the Group’s capital allocation framework. The dividend will be paid from income reserves.

Ěý

Shareholders should seek their own advice on the tax consequences associated with the dividend and are particularly encouraged to ensure their records are up to date with Aspen so that the correct withholding tax rate is applied to their dividend. The Company income tax number is 9325178714. The issued share capital of the Company is 446 252 332 ordinary shares. Future distributions will continue to be decided on a year-to-year basis. In compliance with IAS 10 – Events After the Reporting Period, the dividend will be accounted for in the financial statements in the year ended 30 June 2026.

Ěý

The full announcement is available on Aspen’s website /investor-relations/#financial-results-and-presentations and can also be accessed online at . Any investment decision must be based on the information contained in the full announcement.

Ěý

^1ĚýĚý The Group assesses its operational performance using constant exchange rates (“CER”). The table above compares performance to the prior comparable period at reported exchange rates and at CER.
² Ěý The CER percentage change is based upon the performance for the six months ended 31 December 2023 recalculated using the average exchange rates for the six months ended 31 December 2024.
³ Ěý Operating profit before depreciation and amortisation adjusted for specific non-trading items as defined in the Group’s accounting policy.
⁴ Ěý Normalised headline earnings per share (“NHEPS”) is headline earnings per share (“HEPS”) adjusted for specific non-trading items as defined in the Group’s accounting policy. Ěý

GROUP PERFORMANCE
The Group has delivered positive half year results thanks to strong performances across all segments of the business. Group revenue for the six months ended 31 December 2024 grew 4% (9% CER) with gross profit rising well ahead of revenue at 12% (20% CER), influenced by a higher proportion of sales in Commercial Pharmaceuticals and improved profitability in Manufacturing. Normalised EBITDA was up 12% (21% CER) to R5Ěý823 million mirrored closely by operating profit which rose 11% (23% CER).

Normalised net financing costs of R681 million increased by 20%, impacted by the carry-over effect of higher relative interest rates and increased net debt levels. Higher tax expenses, impacted by regional profit mix and the recent introduction of BEPS Pillar 2 in South Africa, diluted NHEPS growth to 5% (17% CER) with NHEPS of 724 cents. HEPS grew by 4% (16% CER) and earnings per share ended 3% higher (17% CER), affected by higher restructuring costs and intangible asset impairments respectively.

Higher working capital investment in Manufacturing inventory, largely seasonal, weighed on H1 2025 operating cash flows. The higher inventory investment has reduced the operating cash conversion rate to 63% (H1 2024: 89%). Net debt has increased from R26,9 billion to R30,0 billion in the six months to December 2024 with the leverage ratio of 2,5x remaining comfortably within the Group’s targeted range.

SEGMENTAL PERFORMANCE
Commercial Pharmaceuticals
Solid revenue growth of 7% (13% CER) to R16Ěý102 million was augmented by the product portfolio acquisition in Latin America and supported by underlying organic CER growth in all three segments. Gross profit margins remained robust at 59,1% (H1 2024: 59,8%). Normalised EBITDA was up 13% in CER and well aligned to the revenue growth, despite absorbing proportionately higher operating expenses in the business acquired from Sandoz in China.

Prescription
Prescription Brands, the largest segment within Commercial Pharmaceuticals, enjoyed double digit growth of 19% (25% CER), recording revenue of R6Ěý340 million. Americas, which benefitted from the added contribution from the acquired products, led the growth, followed by Africa Middle East boosted by the Lilly portfolio. Gross profit percentage of 61,0% (H1 2024: 61,6%) was supported by a favourable sales mix from Americas.

OTC
OTC revenue declined by 3% (+2% CER) to R4Ěý743 million, impacted by order delays in Africa Middle East, but is expected to rebalance in H2 2025. Excluding Africa Middle East, the other regions enjoyed solid CER growth of 6% for the period. The Australasia OTC portfolio has, for the first time, delivered revenue equal to the region’s Prescription segment and is well positioned for future growth. Gross profit percentage of 58,4% was closely aligned to the prior period (H1 2024: 58,8%).

Injectables
The Injectables portfolio has returned to growth in H1 2025, rising 4% (10% CER) to R5Ěý019 million. Africa Middle East growth was fuelled by the Lilly products including the successful launch of Mounjaro in South Africa during December 2024. The recent product swop transaction with Sandoz impacted Asia positively and Europe negatively, while providing a strong net benefit to Injectables growth. Gross profit percentage declined to 57,5% (H1 2024: 58,9%) influenced by the impact of national volume-based procurement (“VBP”) in China.

Manufacturing
Manufacturing revenue of R5Ěý858 million ended 4% lower (0% CER) with growth in FDF revenue offsetting declines in the Heparin and API businesses. FDF revenue was up 59% supported by the growing contribution from sterile manufacturing contracts. The Heparin revenue reduction was anticipated as the business benefitted from the transition to a working capital light toll model in the prior year. API revenue declined by 21% to R1 888 million impacted by order phasing with a strong recovery expected in H2 2025. Gross profit percentage of 15,9% (H1 2024: 5,3%) benefitted from the higher FDF contribution with a more than twofold increase in normalised EBITDA over the prior period.

PROSPECTS
The Group has made positive progress during the reporting period and is well positioned to deliver on its strategic ambitions.

The negative effects of VBP in China and the reduction in Russia CIS sales are out of the Commercial Pharmaceuticals base, clearing the business of material risk. We anticipate double digit CER revenue and normalised EBITDA growth from Commercial Pharmaceuticals for the full year, underpinned by organic growth in all three segments and benefitting from the acquired portfolio in Latam and the exciting rollout of Mounjaro in South Africa. Following Aspen’s acquisition of Sandoz’s business in China, that business will be reshaped in H2 2025 to ensure it has the capacity and flexibility to meet future opportunities and challenges.

Positive progress has been made towards commercialisation of the Novo insulin manufacturing contract with the final technical milestones expected to be completed in Q4 2025. We expect Manufacturing to continue to deliver robust growth in H2 2025 supported by a sustained strong contribution from sterile manufacturing contracts in FDF and a seasonal second half weighted rebound from the API business. The absolute growth in CER normalised EBITDA from Manufacturing in H2 2025 is anticipated to be similar to the growth achieved in H1 2025.

Localisation preferences are anticipated to be legislated in Q2 CY 2025 which will ensure that all South African dossier registrations for locally manufactured products receive priority review from SAHPRA. The regulatory pathway timelines for the Serum paediatric vaccines will benefit as a result with potential commercial sales from calendar year 2026. Aspen remains committed to achieving incremental CER EBITDA growth from sterile capacity fill initiatives in FDF of R2Ěý450 million over the period FY 2025 to FY 2026 (compared to FY 2024).

GLP-1s, sterile injectable products for the treatment of type 2 diabetes and obesity, represents the largest opportunity currently present in the global pharmaceutical industry. During the past period Aspen has made significant progress in positioning itself as an owner of the intellectual property associated with generic semaglutides (a class of GLP-1s), as a manufacturer of the injectable dosage form of the medication and in establishing the appropriate marketing and distribution reach in time for launch of these products in the market. The first revenue generated by Aspen from its GLP-1 initiatives could be as early as the latter part of FY 2026.

Manufacturing inventory levels are expected to reduce in H2 2025 following the seasonal growth in the first half. This reduction coupled with a cyclically stronger operating cash flow in the second half, should assist the Group in achieving an operating cash conversion rate greater than our target of 100% at year end. Finance costs are anticipated to benefit from lower effective interest rates in H2 2025 driven by the recent interest rate cuts across our EUR, ZAR and AUD debt pools. We anticipate that effective tax rates will be higher from FY 2025 onwards, impacted by the increased profit contribution from sterile manufacturing as well the retrospective introduction of the BEPS Pillar 2 legislation in South Africa.

Any forecast information in the above-mentioned paragraphs has not been reviewed or reported on by the Group’s auditors and is the responsibility of the directors.

The contents of the short form announcement are the responsibility of the Board of directors of Aspen. The information in the short form announcement is a summary of the full announcement.

The full announcement is available on Aspen’s website /investor-relations/#financial-results-and-presentations and can also be accessed online at https://senspdf.jse.co.za/documents/2025/jse/isse/APN/HYresults.pdf. Any investment decision must be based on the information contained in the full announcement.

¹ The Group assesses its operational performance using constant exchange rates (“CER”). The table above compares performance to the prior comparable period at reported exchange rates and at CER.

² Ěý The CER % change is based upon the performance for the year ended 30 June 2023 recalculated using the average exchange rates for the year ended 30 June 2024.

³ Ěý Operating profit before depreciation and amortisation adjusted for specific non-trading items as defined in the Group’s accounting policy.

⁴ Ěý Normalised headline earnings per share (“NHEPS”) is headline earnings per share (“HEPS”) adjusted for specific non-trading items as defined in the Group’s accounting policy.

⁵ Ěý Dividend declared on 2 September 2024, to be paid on 23 September 2024 (2023: Declared on 29 August 2023 and paid 26 September 2023).

Ěý

GROUP PERFORMANCE

Ěý

H2 2024 was the start of Aspen’s journey to both realising the tangible benefits from sterile manufacturing investments and the delivery of a predictable, resilient, growing Commercial Pharmaceuticals business that has managed and absorbed the volume-based procurement (“VBP”) risks in China. In FY 2024 the Group has achieved a record H2 normalised EBITDA of R6Ěý061 million up 17% on H1 2024. The higher than anticipated negative impact of VBP resulted in Aspen falling short of its targeted mid-single digit growth in EBITDA.

Ěý

Group Revenue for the reporting period was up 10% led by Manufacturing growing by 25% and Commercial Pharmaceuticals increasing by 4%. Gross Profit grew 3% diluted by an increased Manufacturing sales mix with the primary driver being the liquidation of Heparin inventory of R2,9 billion. Normalised EBITDA of R11Ěý255 million was up 1%.

Ěý

Net financing costs of R1 232 million (R1 284 million adjusted for capital raising fees on transactions of R52 million) remained flat compared to the prior financial year. Increased net interest costs, fueled by higher rates and increased net debt levels, were offset by lower foreign exchange losses resulting from reduced volatility in emerging market currencies relative to the Euro. Financing costs in FY 2025 will continue to be influenced by the interest rate cycle and currency volatility. NHEPS of 1 492 cents ended marginally below FY 2023. HEPS declined by 3% and earnings per share ended 16% lower affected by higher acquisition related transaction costs and the impairment of VBP impacted intangible assets respectively.

Ěý

Operating cash flow per share of 1 401 cents grew 13%, supported by an improved operating cash conversion rate of 103% (FY 2023: 88%). This exceeded our internal benchmark of 100%. Solid operating cash flows, even after partial funding of the Latin American product portfolio acquisition of R2,1 billion, coupled with the benefit of reducing the Group’s investment in Heparin inventory by R2,9 billion were the key catalysts in this positive shift. Net debt increased from R22,2 billion in June 2023 to R26,9 billion in June 2024 with net acquisitions totalling R7,7Ěýbillion being key to the rise. The leverage ratio ended at 2,3x comfortably within the Group’s targeted range.

SEGMENTAL PERFORMANCE

Ěý

Commercial Pharmaceuticals

Commercial Pharmaceuticals revenue grew by 4% to R30 570 million with the growth in Prescription and OTC more than offsetting the decline in Injectables revenue. Gross profit margins were marginally lower at 59,4% (FY 2023: 60,0%) after absorbing the impact of VBP in China.

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Prescription

Prescription Brands enjoyed double digit growth of 15%, recording revenue of R11Ěý380 million. The revenue growth was underpinned by solid organic growth in its largest region, Africa Middle East, and organic and acquisitive growth in the Americas which is now the second largest region.

Gross profit percentage was up at 60,9% (FY 2023: 60,7%) with favourable sales mix more than offsetting the impact of the regulated price cuts in Australia.

Ěý

OTC

OTC, the second largest segment in Commercial Pharmaceuticals, grew revenue by 7% to R9 706 million with all regions reporting solid growth. Gross profit percentage of 58,7% remained in line with the prior year of 58,6%.

Ěý

Injectables

Injectables was impacted by the more severe than expected outcome of VBP in China on Fraxiparine and Diprivan. Growth in Africa Middle East and the Americas (most notably Brazil) partly mitigated the overall segment sales reduction which recorded a revenue decline of 9% to R9 484 million.

Gross profit percentage declined to 58,2% (FY 2023: 60,6%) influenced by the impact of VBP, partly offset by cost of goods savings from the continuing insourcing of sterile production.

Manufacturing

Manufacturing revenue grew significantly, increasing 25% partly aided by exchange rate tailwinds. FDF revenue growth accelerated from 10% in H1 2024 to 33% at year-end, supported by an increased contribution in H2 2024 from third-party contracts for sterile manufacturing. Heparin revenue growth of R1Ěý469 million over the comparable period was largely due to the transition to toll manufacture. API sales were up 2%, following a rebound in H1 2024.

Ěý

Gross profit of R1Ěý307 million was 2% ahead of FY 2023. The gross profit percentage ended lower at 9,2% (FY 2023: 11,4%) influenced by the increased sales mix of Heparin and the non-recurrence of the grant funding enjoyed in the prior year.

Ěý

PROSPECTS

The Group has achieved a solid set of results for the year ended 30 June 2024 even after absorbing the more severe impact of VBP in China. The 17% growth in normalised EBITDA in H2 2024 compared to H1 2024 sets a firm foundation in building momentum for anticipated strong growth in FY 2025.

Ěý

The Commercial Pharmaceuticals business has been derisked and is well poised for future growth. We anticipate Commercial Pharmaceuticals will achieve double digit CER revenue growth in FY 2025 supported by underlying growth in all three business segments and underpinned by organic growth accompanied by annualised growth from recent portfolio acquisitions.

Ěý

For Manufacturing, we expect FDF, supported by an increased sterile capacity fill contribution, to be the main contributor to CER EBITDA growth in FY 2025. Over the period FY 2025 to FY 2026 (compared to FY 2024) we estimate CER EBITDA to increase incrementally by R2 450 million from these initiatives. This value growth is consistent with previous guidance, but the realisation may vary between the two financial years, dependant on the timing of the South African regulatory approvals.

Ěý

Supporting our capacity fill and commercial initiatives, Aspen has also secured a commercial license for the intellectual property necessary to commercialise GLP-1s post the expiry of the originator product patents. In addition, Aspen will be the exclusive global supplier of these products to the licensor. This exciting opportunity could benefit Aspen from calendar year 2026 onwards and consequently also be additive to the capacity fill contributions for FY 2026.

Ěý

Finance costs will continue to be influenced by the interest rate cycle. We are expecting an increase in net interest costs driven by the residual impact of current higher interest rates being carried forward to FY 2025. We expect the effective tax rate to increase in FY 2025 as the profit contribution from sterile manufacturing increases.Ěý Lower working capital investment and strong operating cash flows should assist us in achieving an operating cash conversion rate greater than our target of 100%.

Ěý

Any forecast information in the above-mentioned paragraphs has not been reviewed or reported on by the Group’s auditors and is the responsibility of the directors. The full announcement has been released on SENS and is available on Aspen’s website. Any investment decision must be based on the information contained in the full announcement.

¹The Group assesses its operational performance using constant exchange rate (“CER”). The table above compares performance to the prior comparable period at reported exchange rates and at CER.
² The CER % change is based upon the performance for the six months ended 31 December 2022 recalculated using the average exchange rates for six months ended 31 December 2023.
³Operating profit before depreciation and amortisation adjusted for specific non-trading items as defined in the Group’s accounting policy.
^4ĚýNormalised headline earnings per share (“NHEPS”) represents headlines earnings per share (“HEPS”) adjusted for specific non-trading items as defined in the Group’s accounting policy.

GROUP PERFORMANCE
The Group has exceeded its guided performance growing normalised EBITDA ahead of H1 2023 and overcoming the negative impact of VBP in China as well as the loss of grant funding which benefitted the prior period.

Group revenue for the six months ended 31 December 2023 grew 10% (2% CER) to R21 141 million, with Commercial Pharmaceuticals revenue up 3% (-3% CER) and Manufacturing revenue increasing by 33% (17% CER). Group gross profit grew 4% (-3% CER) muted by an increased Manufacturing sales mix. Normalised EBITDA rose 2% (-5% CER) to R5 194 million. Elevated transaction costs primarily relating to acquisitions, together with increased intangible asset impairments due to the VBP impact in China, resulted in operating profit declining.

Normalised net financing costs of R566 million were 3% (-10% CER) lower than the prior year. Increased net interest costs, fueled by higher rates, were more than offset by lower foreign exchange losses resulting from reduced volatility in emerging market currencies relative to the Euro. NHEPS advanced 1% (-5% CER) aided by the lower net financing costs. Financing costs in H2 2024 will continue to be influenced by the interest rate cycle and emerging market foreign currency volatility. HEPS declined by 6% (-12% CER) and earnings per share ended 13% lower (-18% CER) affected by the higher transaction costs and intangible asset impairments respectively.

SEGMENTAL PERFORMANCE
Commercial Pharmaceuticals
Aspen has revised and refined its reportable segments to align to the Group’s Commercial Pharmaceuticals growth strategy. The new segments comprise Prescription, Over-the-counter (“OTC”) and Injectables which have been defined in the basis of accounting section of the financial results.

Commercial Pharmaceuticals revenue grew by 3% (CER -3%) to R 15Ěý029 million underpinned by organic growth in OTC and Prescription offset by a decline in Injectables revenue. Gross profit margins remained consistent at 59.8% (H1 2023: 60.0%).

Prescription
Prescription Brands recorded revenue of R5Ěý306 million enjoying steady momentum of 7% (CER 1%) aided by growth in its largest region, Africa Middle East, and the Americas. Australasia, the second largest region in this segment, was adversely impacted by further regulated price reductions.

Gross profit percentage was up at 61.6% (H1 2023: 60.7%) augmented by a favourable sales mix, which more than offset the regulated price cuts in Australia.

OTC
OTC, the second largest segment in Commercial Pharmaceuticals, grew revenue by 10% (CER 4%) to R4 893 million with all regions reporting solid growth. Gross profit percentage of 58.8% remained in line with the prior year of 58.6%.

Injectables
This segment was heavily impacted by further VBP in China and the reduction in demand in Russia CIS. Strong hormonal injectable brand growth in the Americas (most notably Brazil) partly mitigated the overall segment sales reduction which recorded a revenue decline of 6% (CER -12%) to R4Ěý830 million.

Gross profit percentage declined to 58.9% (H1: 2023 60.5%) influenced by the impact of VBP, partly offset by further cost of goods savings from insourcing sterile production.

Manufacturing
Manufacturing revenue grew significantly, increasing 33% (CER 17%) partly aided by exchange rate tailwinds. API, the largest and most profitable segment in Manufacturing, rebounded strongly in H1 2024 with revenue growing by 18% (CER 4%). Finished Dose Form (“FDF”) revenue increased by 10% (CER -2%) impacted by the loss of final COVID vaccine sales included in the previous year. Heparin incremental revenue growth of R957 million over the comparable period was augmented by the transition to toll manufacture. Following this transition the Heparin segment which previously included the full value chain contribution from all heparin containing products being APIs and FDF sales, will now include heparin API sales only.

Gross profit percentage was in line with the prior year at 5.3% (H1 2023: 5.2%) with the loss of grant funding being offset by a strong performance from API, the benefit of additional Heparin sales and the delay to the second half of FY2024 of a technical shutdown at the Group’s French facility.

PROSPECTS
The Group has achieved results in the first half which were well aligned to guidance provided.

H2 2024 is the start of the journey to both realising the tangible benefits from sterile manufacturing investments and delivering a predictable growing base Commercial Pharmaceuticals business that has managed and successfully absorbed the VBP risks faced in China.

Based upon current exchange rates, and notwithstanding the impact of VBP in China and the loss of grant funding of USD30 million which benefitted the prior year, we anticipate mid-single digit reported growth in normalised EBITDA for FY2024. The targeted growth is underpinned by expected reported revenue growth in both Commercial Pharmaceuticals and Manufacturing.

For Commercial Pharmaceuticals, we expect the H1 2024 revenue increase to be boosted by an additional R1 billion in revenue growth targeted for H2 2024 over H2 2023. This growth will be driven organically and complemented by the inclusion of portfolio acquisitions in South Africa and Latin America partly offset by the impact of VBP in China, including the addition of Diprivan in the latest round. Manufacturing is poised to enjoy a strong second half supported by the expected contribution of R500 million flowing from the initiation of sterile contracts and a seasonally stronger performance from the API business.

We expect manufacturing inventory levels to reduce in H2 2024 as the Heparin business fully transitions to a working capital light toll manufacturing model. The lower anticipated working capital cash flow investment compared to FY2023 should assist us in achieving an operating cash conversion rate greater than our target of 100%.

During H2 2024, we will be looking to close out further opportunities, currently under discussion or diligence, to more fully utilise our available sterile capacities. We remain confident in achieving the guided contributions of at least R3 billion in FY2025 increasing to no less than R4 billion in FY2026. These contributions, together with a de-risked Commercial Pharmaceuticals’ base business will form the cornerstone for strong organic revenue and earnings growth into the future.

Any forecast information in the above-mentioned paragraphs has not been reviewed or reported on by the Group’s auditors and is the responsibility of the directors.