Highnoon Labs rebuts 'dubious' article

May 16, 2024 (MLN): Highnoon Laboratories Limited (PSX: HINOON) has denounced an article published in the media titled “Highnoon Laboratories and the Curious (Court) Case of Related Party Transactions”, saying that it contains dubious information regarding the company and its management — some of which is factually incorrect.

A plausibility exists that the said article may have created confusion and misunderstanding leading to fluctuations in the share price of HINOON, it said in a company filing on Thursday.

Highnoon Labs said that while it investigates the matter further to understand this deliberate attempt at defaming the company, "we would like to assure our shareholders that the company and its management has been working tirelessly to maximize the well-being of its shareholders and has delivered remarkable results for the past several years."

Moreover, the company said it is not only focused on its commercial growth but has also aligned its goals with shareholder wealth whereby; the earning per share has increased from 24.53 in 2017 to 45.35 in 2023.

Moreover, the payout ratio has also increased from 40.8% to 66.2% during the same timeline.

Consistently for the past 10 years, the company has been issuing bonus shares to the shareholders ranging between 10-15%, specifically, in 2023, the company issued a total of 25% bonus shares to its shareholders.

Moreover, for the financial ended on December 31, 2023, the company issued a dividend of 300% i.e. Rs30 per share.

It is pertinent to note that the company complies with all procedures provided under the applicable Companies Act, 2017 for approval of its related parties’ transactions (RPTs), the notice said.

All RPTs are first discussed in the Audit Committee and recommended by the same to the Board of Directors for final approval.

“The minutes clearly stipulate the nature of the RPTs, which are conducted in the normal course of business and on an arms’ length basis,” it said.

Moreover, the interest in the associate company Route 2 Health (Private) Limited; and its wholly owned subsidiary Curexa Health (Private) Limited has been properly disclosed.

Accordingly, the transactions carried out with the said entities are fully disclosed to the Board members and all stipulated for public dissemination in the quarterly and annual financial statements of the company, it added.

The related party transactions have contributed positively towards the profitability of the company.

“To provide an overall holistic picture of the related parties’ transactions and to further strengthen the company’s transparent approach, the said RPTs were also presented to the shareholders in the recent AGM of the Company held on 29 April 2024 in accordance with applicable law,” the company further said.

Moreover, HINOON stated that it defies logic to suggest that the company could achieve extraordinary profit growth if there were any substance to these allegations.

In a landscape where competitors in the same industry are grappling with diminishing returns, the fact that the company continues to flourish and exhibit remarkable profit increases speaks volumes about the integrity of our operations and financial management, it noted.

“These achievements stand as irrefutable evidence of the company's robust performance and unwavering adherence to ethical business practices,” the notice further reads.

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