UPDATE 1-Spain's Grifols shares slide after disappointing Q4

(Adds details on margins, drop in shares)

MADRID, Feb 27 (Reuters) - Shares in Spanish pharmaceutical company Grifols slipped on Thursday after its fourth-quarter margins disappointed analysts even though annual net profit rose 4.8%.

Gross profit margin grew 2.3 basis points to 44.7% in the fourth quarter from the same period in 2018, while analysts had expected 46%, Madrid-based brokerage Renta 4, said in a note to investors.

“We expect a negative response to the results due to a smaller than expected margin increase,” Renta 4 said before the market opened.

In mid-morning trade, Grifols shares were down 2.7% at 31.4 euros, while the Ibex-35 was down 1.9%.

Renta 4 expected Grifols to announce a gross margin of 46.4% in the fourth quarter.

Net profit reached 625 million euros ($679 million) mainly as a result of the growth of its blood plasma-derived medicines business, Grifols said. Grifols’ revenue rose 14% to 5.1 billion euros, while its EBITDA was up 17% to more than 1.4 billion euros, after the company expanded its network of plasma collection in recent years to meet increasing demand.

After refinancing its 5.8 billion euro debt in the third quarter, Grifols reduced its debt leverage ratio to 4.17 times of EBITDA at the end of 2019 down from 4.78 times a year earlier. It expects to bring its debt further down. Grifols’ shares have outperformed the Spanish blue chip Ibex-35 over the past year. The shares of the company gained 35%, while the index fell 0.3%, according to Refiniv data.

$1 = 0.9201 euros Reporting by Emma Pinedo, editing by Andrei Khalip, Inti Landauro and David Evans