Health Check: Ansell gloves up for Trump tariff threat

Ansell has moved to expand its manufacturing presence beyond China, to countries including India and Sri Lanka.

Ansell says there will be no tariff blow-up, but it's not leaving anything to chance. Pic via Getty Images

• Ansell is expanding its manufacturing to be less reliant on China

• Mayne Pharma pre-announces a strong first-half earnings recovery

• Alterity Therapeutics raises $40 million on the back of encouraging trial

 

The maker of personal protective equipment – mainly gloves – Ansell (ASX:ANN) has turned to its own corporate protection strategy to reduce its dependence on Chinese manufacturing as the Trump tariff war blows up.

Announcing stellar half-year results this morning, Ansell CEO Neil Salmon said US duties could become a tailwind for Ansell, as many rivals depended more on sourcing goods from China than his company.

Ansell has 14 manufacturing sites across nine countries, including China and, to a much smaller degree, Mexico.

“For some time now, we have been working on a strategy to minimise any single country dependence, no matter what country that maybe,” he told an investor webinar.

“We have been scaling up in Sri Lanka, so Sri Lanka can make the same products that historically we were only able to make in China.

“Of course that reduces our dependence on China sourcing to the US.”

The former condom maker’s key prophylactic measure is a new surgical glove facility in India, which is nearing completion.

The Indians hope they can ward off a Trump tariff by reducing their own duties on US goods.

Ansell must be hoping a scheduled meeting between Trump and Indian PM Narendra Modi on Wednesday goes swimmingly well.

Luckily, there’s a Plan B.

“Overall, should tariffs come into effect our first step is to mitigate those through sourcing options," Salmon says.

“If that is , we expect to be able to pass on tariff increases to our customers.”

Ansell reported December-half revenue of US$1.02 billion, 30% higher.

Allowing for the July 2024 purchase of protective equipment maker KBU for US$635 million, organic revenue gained 12.5%

Reported profit came in at $55 million, up 183% while earnings before interest tax (ebit) rose 63% to $127.4 million.

The board upped the interim dividend by 35%, to US22.2 cents a share.

The healthcare segment accounted for 55% of sales and 48% of ebit, with surgical gloves leading the way with a 26% increase.

The company upped its full-year guidance to earnings per share of US$118-128 cents, from the previously envisaged US$110-127 cents.

Can’t wait for the Mayne event? Don’t have to

Ahead of its scheduled February 26 interim results, generic drug maker Mayne Pharma (ASX:MYX) has spared investors the wait by disclosing a strong earnings recovery.

Mayne expects December-half revenue to be $210 – $215 million, 12-14% higher with adjusted underlying earnings of $30-32 million, up 275-300%.

Management attributes the earnings recovery to the women’s health portfolio – contraceptives – as well improved margins for its dermatology products.

“We have experienced solid trading conditions in the first half as we execute against our corporate strategies,” trills Mayne CEO Shawn Patrick O’Brien.

Mayne has put special effort into developing Nextstellis, a higher value product described tautologously as a ‘branded generic’.

Also known as Estetrol or E4, Nextstellis is the only human estrogen derived from a plant.

In a December note, broker Wilson described Nextstellis’ performance as impressive.

The firm also was heartened by Mayne's adoption of working capital and cash flow management practices “vastly improved from the company’s cavalier past.”

Wilsons adds that dermatology remains a “hardscrabble business, where running hard to stand still is the norm.”

Mayne shares surged close to 20% this morning.

Radiopharm reports brain imaging success

Radiopharm Theranostics (ASX:RAD) says an imaging study of 22 brain cancer patients detected metastases in all cases, “regardless of whether  they were previously treated with radiation and the tumour of origin.”

The company’s agent of choice is its proprietary radiotracer, RAD-101, which transports an agent that targets a fatty acid cancer expressed by the tumours.

The test is done in conjunction with positron emission tomography and multiparametric magnetic resonance imaging.

The phase 2b study covered 12 untreated patients and ten previously administered brain radiation.

In other trial news, genetic medicine house PYC Therapeutics (ASX:PYC) has been given the go-ahead to start a local trial of its drug candidate for polycystic kidney disease, which affects around five million people globally.

The safety and dosing range study will be carried out at four Australian sites, enrolling 24 patients between 18 and 60 years old in the initial phase.

Clinuvel targets a younger market

There's more from the clinic.

Clinuvel Pharmaceuticals (ASX:CUV) says a follow-on (post authorisation) study showed its approved remedy for a rare skin disorder was just as safe in adolescents as adults.

The company is seeking expanded usage of its drug Scenesse, for erythropoietic protoporphyria (EPP) from adults to 12-to-17 years olds.

Enrolling 12 adults and 12 adolescents, the study showed the drug’s safety profile was “consistent with that reported in long-term adult use”.

As a key to efficacy, the bioavailability of the drug looked similar.

The company plans to sound out the European Medicines Agency for approval.

An inherited genetic disorder marked by extreme sun intolerance, EPP affects about one in 140,000 people.

Adolescent sufferers currently are deprived of treatment.

Capital raising corner

Alterity Therapeutics (ASX:ATH) has raised a chunky $40 million in a placement, to further its promising clinical program of its drug candidate for the Parkinsonian disorder, multiple system atrophy (MSA).

Local and offshore investors coughed up 1.1 cents for the two-tranche placement, at an 8% discount.

As is often the case these days, the offer includes free options (on a one-for-four basis, exercisable at 2.8 cent by February 26, 1027).

“I am looking forward to engaging with the US Food and Drug Administration on the best path to bring to individuals as soon as possible,” Alterity chief Dr David Stamler said.

Meanwhile, portable X-ray device developer Micro-X (ASX:MX1) emerged from share suspension after detailing its placement and rights issue of up to $6 million, unveiled on Thursday.

The institutional leg has raised $3.3 million at 7 cents apiece at a 10% discount; now for the always-tricky retail leg to gather the rest.

Originally published as Health Check: Ansell gloves up for Trump tariff threat