QCIL posts over 500-percent profit surge to $6 million

Oluwatosin Racheal Alabi -

Key Points

  • QCIL reported a Profit After Tax of Shs 22.05 billion ($6 million) for the half-year ending September 30, marking a substantial increase from Shs 3.56 billion ($970,000) in the same period last year.
  • The company's revenue rose from Shs 121.1 billion ($33 million) to Shs 152 billion ($41.4 million), driven by strong demand from sovereign and institutional clients.
  • QCIL's Board has approved the construction of a second production facility at its Kampala site to meet growing demand and expand into new treatment areas.

Quality Chemical Industries Ltd. (QCIL), a prominent pharmaceutical manufacturer based in Kampala, has reported a stunning Profit After Tax of Shs22.05 billion ($6 million) for the half-year ending Sept. 30. This represents a significant rise from Shs3.56 billion ($970,000) in the same period last year, marking a more than 500-percent increase.

The impressive results reflect QCIL's strong performance across key customer segments, with a notable boost in demand from sovereign and institutional clients.

Revenue growth and improved profit margins

QCIL's revenue increased by 25 percent, rising from Shs121.1 billion ($33 million) to Shs152 billion ($41.4 million). Orders from sovereign clients grew by 36 percent, contributing Shs31.6 billion ($8.6 million), while institutional orders rose by 35 percent, adding Shs8.3 billion ($2.3 million).

Gross profit margins also saw a substantial improvement, increasing from 22 percent in H1 FY24 to 39 percent in H1 FY25. This surge was attributed to enhanced manufacturing efficiencies, disciplined raw material cost management, and a favorable product mix. Antiretroviral (ARV) sales accounted for 76 percent of total sales in H1 FY25, up from 44 percent the previous year, while anti-malarial drugs (ACTs) dropped from 53 percent to 24 percent of sales.

Employee incentives and dividends

As part of its growth strategy, QCIL introduced a long-term incentive program for select employees, with an initial provision of Shs2.0 billion ($545,000) for FY24. This initiative is designed to enhance employee engagement and align performance with corporate goals.

The company also declared an interim dividend of Shs3.5 ($0.95) per share, payable by Dec. 12. This follows a final dividend of Shs5.7 ($1.55) per share declared for the fiscal year ending March 31, 2024, reflecting QCIL's commitment to delivering value to shareholders.

Expansion to meet rising demand

To address growing demand, QCIL’s Board has approved the construction of a second production facility at its Kampala site. The expansion will boost capacity for existing treatments and support entry into new areas, including tuberculosis treatments, injectables, and innovative products. The facility, which will be debt-financed, underscores QCIL's commitment to advancing healthcare in East Africa and maintaining its status as a leading producer of WHO-prequalified HIV/AIDS and malaria treatments.

QCIL's stellar performance and strategic investments highlight its critical role in enhancing access to essential medicines across the region.