Bioton’s net profit for 4Q06 came in at PLN 29.5, (+365% y/y) which is 36% above the consensus estimate of PLN 21.7m. However, the outperformance is entirely attributable to PLN 27m net gain on financial activity. The report has not provided explanation of it. It is the second consecutive quarter that Bioton surprised negatively with high reported profits coming from non recurrent operations. In 3Q06 the company booked PLN 35 one off gain coming from revaluation of SciGen’s intangibles. As the results for 4Q06 were deeply below market expectations on sales and EBIT we believe the impact should be negative.
Sales came in at PLN 61.6m (+26.5% y/y) which is 23% below the consensus estimate of PLN 61.6m and even below the low consensus range of PLN 76m.
EBIT came in at PLN 15.8m (+44% y/y), 41% below market consensus estimate of PLN 26.9m. The operating margin for 4Q06 of 25.6% was lower than 33.6% expected by the market.