Swiss pharmaceutical giant Roche has said it is "reviewing strategic options outside the group for the vitamins and fine chemicals division" after a difficult year in 2001.
The division posted sales of SFr3.54 billion (€2.4bn) in 2001, just 1 per cent higher than in 2000 excluding sales from the medicinal feed additives division which was sold in 2000.
Despite additional productivity gains, operating profit and EBITDA declined by SFr148 million and SFr142 million respectively, on an adjusted basis. Roughly 30 per cent of the year-on-year decrease in profits can be accounted for by the one-time gain recorded in 2000 on the sale of the medicinal feed additives business, while the rest was due to further increases in raw material and energy costs and lower selling prices.
The division last year also faced legal sanctions by the European Commission, which imposed a fine of €525 million on Roche for its part in a price fixing cartel. The company said it had already set aside the funds to pay the fines, as well as an additional SFr760 million to cover potential liabilities arising from customer lawsuits in the United States.
The relatively poor performance of the vitamins division was not reflected by the company as a whole, however. The Roche group posted a 6 per cent rise in sales for 2001 to SFr29.2 billion, lifting operating profits 11 per cent to SFr4.8 billion. However, net profit fell 4 per cent to SFr4.8 billion as a result of increased taxes and lower financial income.
The diagnostics and pharmaceuticals divisions were the main drivers of sales growth in 2001, with revenues up 10 per cent and 6 per cent respectively in Swiss franc terms.
The company said that it expected sales growth in 2002 to be in the mid to high single-digit range. Sales growth in vitamins is only likely to be in the low single-digit range, however, as the market continues to suffer from a downturn in interest.