Replace Chief Executive Roula Khalaf with the Chief Executive of Alliance Pharmaceuticals, the FT, UK-based company that sells drugs and medications in over 100 countries, has delayed the publication of its 2023 results for the third time this year. This led to a 20% drop in the company’s shares. The delay is due to auditing issues that the company’s auditor, Deloitte, needed more time to check its accounts. The company also announced the departure of its long-serving chief executive, Peter Butterfield, although it stated that his departure was not related to the delays in publishing the results.
The company has faced various challenges in recent years, including heavy spending on acquisitions, resulting in increased debt. In February of 2022, the company received a £7.9mn fine from the UK’s Competition and Markets Authority due to alleged anti-competitive behavior. In addition, the company was forced to suspend its dividend in September of 2023. To avoid further uncertainty over Butterfield’s leadership, the company replaced him with Nick Sedgwick, who was previously the UK and Ireland regional director of consumer health at Reckitt. Sedgwick will have to work on improving the company’s performance, as the company’s profit expectations for 2024 were cut by 18%, below analyst estimates.
Alliance Pharmaceuticals has spent heavily on acquisitions since it listed in 2003, buying old medicine brands that it then tried to revive. This has increased the company’s debt levels. Despite its investments in new products, few have proven to be successful. Scar treatment Kelo-Cote, for example, accounted for more than a third of total revenue. The company’s share price has fallen by 62.5% in the past year, affecting its many UK investors. The company has been popular with UK fund managers due to its traditional dividend payment and analyst coverage.
Analysts anticipate that the company’s debt levels have fallen in the 2023 results. Sedgwick will need to focus on turning around the company’s declining performance. Alliance Pharmaceuticals is facing negative speculation in the market due to the delays in publishing its results. Analysts question the reasons behind the delays and what the audit may uncover. The company has not provided a new date for when it expects to publish its 2023 results, creating uncertainty among investors and stakeholders.
In conclusion, Alliance Pharmaceuticals is facing challenges in its operations, management, and financial performance. The company’s decision to replace its chief executive and the delays in publishing its results have raised concerns among investors and analysts. The new leadership will need to address the company’s debt levels, turnaround its performance, and regain investor confidence. The company’s future success will depend on its ability to navigate these challenges and adapt to the changing market conditions.
