Release Date: February 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Revenues increased by 13% to $213.1 million, driven by strong growth in the women's health segment.
• Gross margin expanded significantly to 61.4% from 56.3% in the prior corresponding period.
• Underlying EBITA rose by 288%, showcasing substantial improvement in profitability.
• Positive operating cash flow of $25.9 million from continued operations, a significant turnaround from a negative cash flow in the previous period.
• The women's health portfolio showed strong performance with revenues up 30% and direct contribution up 117%.

Negative Points

• Cash and marketable securities decreased to $124.9 million from $149.3 million, impacted by a one-time class action payment.
• Revenue from dermatology showed only modest growth of 1%, with competition affecting sales of certain products.
• International segment's direct contribution declined due to timing effects of shipments and production schedules.
• The acquisition by Cosette Pharmaceuticals may raise concerns about the future strategic direction and independence of Mayne Pharma Group Ltd (MAYNF).
• Despite improvements, the company faces ongoing challenges with legacy inventory returns affecting revenue in the women's health segment.

Q & A Highlights

• Warning! GuruFocus has detected 4 Warning Signs with MAYNF.

Q: Can you talk about any additional interest or competitive bids received during the acquisition process? A: (Sean Patrick O'Brien, CEO) Everything that we can share at this time is in the scheme implementation deed that was publicly shared, and details will be presented as they emerge.

Q: How is the pipeline for new products looking, and are there any expected to come through soon? A: (Sean Patrick O'Brien, CEO) We remain active in ensuring we can supply more products to the dermatology community. As we cement deals, we communicate to the market per our continuous disclosure requirements.

Q: Can you quantify the benefit of the disintermediation strategy? A: (Sean Patrick O'Brien, CEO) It's a combination of factors. Most of the improvement is driven by product mix, such as the full period of sales from Rofaid. Our channel strategy has allowed us to maintain pricing and market share despite competition.

Q: How is the product marketplace for generic Horatia operating in terms of share and pricing? A: (Aaron Gray, CFO) We maintained volume in our channel, losing share only in the big three wholesalers. We have not changed pricing since the generics launched, demonstrating the value of our channel strategy.

Q: Why is Mayne Pharma prepared to sell the company at the start of a turnaround story, and why at such a low price? A: (Sean Patrick O'Brien, CEO) The turnaround has been ongoing for 2.5 years. The board unanimously recommends the scheme, which offers a significant premium to the current share price, reflecting the value for shareholders.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.