Aspen Pharmacare gets fined £2.10m in UK
North America and the majority of the energy complex after reviewing the operations.
The group intended to shift PM9’s base paper production to its state-ofthe-art mills in Cloquet, Minnesota and Skowhegan, Maine. Sappi said 75 employees would be impacted and the impacted assets were expected to close by the end of calendar year 2020.
“As a result of these actions, a restructuring charge of approximately $14m is expected during Sappi’s fourth quarter, in addition to approximately $8m of accelerated depreciation to be recorded during the second half of calendar 2020,” the group said. It estimated an annual saving of $10m.
In May the diversified wood fibre company reported that its profits had plunged in the second quarter to March, as prices stalled due to the global coronavirus pandemic.
Covid-19 saw the company slashing its capital expenditure as profits tumbled to from $72m to $2m on earnings before interest, tax, depreciation and amortisation that fell to $131m from $187m last year.
The group said at the time that the dissolving pulp market prices had also eased by $233 a ton in the past 12 months as the combined impact of soft global textile markets, US duties on textiles from China, excess viscose staple fibre capacity and a weaker dollar to renminbi exchange rate drove prices downwards.
In April, Sappi announced in recognition of the uncertain trading environment due to Covid-19, the board of directors and the group and regional leadership teams in Europe, North America, Southern Africa and Trading had volunteered a 10 percent reduction in salaries or fees for the three months to June and would receive no short-term incentive bonuses for the 2020 financial year.
Sappi plans to release its third quarter financial results for the period ended June on Thursday, July 30.
Sappi shares closed 1.36 percent lower at R26.15 on the JSE yesterday.
ASPEN Pharmacare eased more than 3 percent on the JSE yesterday after the drug maker announced that the UK Competition and Markets Authority (CMA) had confirmed its decision to fine it £2.10 million (R45m).
The fine emanated from a 2017 investigation for alleged anti-competitive conduct of the Treaty on the Functioning of the EU on the supply of fludrocortisone acetate 0.1mg tablets and dexamethasone 2mg tablets in the UK.
Although the CMA dropped the dexamethasone investigation in August last year, it informed Aspen of the possibility of the fine after the group entered into an agreement to acquire a potential competitor with the consequence that the conclusion of the agreement resulted in anti-competitive behaviour.
Aspen also made commitments to pay an payment of £8m for the purposes of addressing the competition concerns arising from certain aspects of the investigation by the CMA.
It said it would also dispose of its rights to fludrocortisone in the UK to an independent third party overseen by the CMA and Aspen.
Aspen chief executive Stephen Saad yesterday said: “We are pleased to have finalised this matter with the CMA.”
The group stock declined to R144.45 a share in intratrade from Wednesday’s close of R149.22 before closing 3.46 percent lower at R144.06 on the JSE yesterday.
Aspen’s share price has been bullish since the beginning of the year, rising nearly 20 percent.
Last month, the stock surged more than 10 percent in one day after the World Health Organization welcomed the use of dexamethasone for patients who are critically ill with Covid-19 after studies in the UK confirmed that the drug cut the risk of death among ventilated patients by a third and reduced mortality by a fifth in those receiving oxygen.