JOHANNESBURG (Reuters) -Shares in South Africa’s Aspen Pharmacare dropped more than 30% on Wednesday, a day after the company issued a profit warning over what it called a “material contractual dispute”.
Aspen alerted shareholders to the dispute after the close of the local stock market on Tuesday.
It said it related to a manufacturing and technology agreement with a contract manufacturing customer for mRNA products, saying details were subject to contractual confidentiality.
Normalised earnings before interest, taxes, depreciation and amortization from its manufacturing business could be 2 billion rand ($107.28 million) lower than last guided in its full-year results, it added.
By 1410 GMT on Wednesday its shares were down about 32%.
On a Wednesday call, Aspen said the dispute had come “from left field” and management was not aware of it at the time of the company’s interim results presentation in March.
It said the dispute could have a direct impact on its French sterile manufacturing site, the driver of profitability in its manufacturing segment in its half-year earnings.
“This development is clearly a significant disappointment, exacerbated by the potential loss of value in the investment we have made to access the aligned mRNA technology.”
($1 = 18.6431 rand)
(Reporting by Siyanda Mthethwa;Editing by Alexander Winning)
