Synthetech profits rise but uncertainty lies ahead
The company, which develops and manufactures specialty amino acids, peptide fragments and proprietary custom chiral intermediates, enjoyed a good Q4, recording an operating profit of $0.7m.
In addition Gregory Hahn, president and CEO of Synthetech, said: "The recent downturn in the economic environment and resulting difficulties in the credit markets did not impact our business.
“Our third consecutive year of increased revenues combined with gains in production efficiencies and purchasing cost reductions resulted in a nicely profitable fiscal 2009.”
This performance has made Synthetech “guardedly optimistic” about 2010 but it admitted that it is unable to predict if the challenging economy will have a significant negative effect on next years results.
Elaborating on this Hahn said: "We are seeing some weakness in the emerging biopharmaceuticals market, where difficulty raising funds impairs ongoing drug development projects.
“In addition, some major pharmaceutical companies appear to be reducing their outsourcing expenditures. Both of these issues also impact our contract drug synthesis market where our traditional peptide building block products are sold.”
Synthetech also acknowledged that it operates in a market that is prone to fluctuating from quarter to quarter, with the company reliant on the cycle of large scale projects that are hard to predict the progress, timing and revenue potential of.
The company’s revenues for the year were $19.9m, up from $14.6m the previous year, with significant income coming as a result of resolving production difficulties it encountered in 2008.
