Company Watch

Pharma companies clock growth in Q3 2010

Hikal

Hikal clocked net sales of Rs119.9 crore; with a profit after tax (PAT) of Rs14.4 crore for the third quarter (Q3) ended 31st December, 2009. The EBIDTA for this quarter increased to Rs. 42 1 crore as compared to Rs 38.5 crore in the corresponding quarter of the previous year, resulting in an increase of six percent. Profit before tax (PBT) and extraordinary expenses stood at Rs. 24.6 crore as compared to Rs 26.4 crore in the corresponding quarter of the previous year.

Pharma sales were up by 22 percent to Rs 80.0 crore as compared to Rs.65.7 crore in the corresponding quarter of the previous year. Agro sales were down by 39 percent due to inventory cutbacks by customers.

The crop protection business recorded net sales of Rs 120.9 crore as compared to Rs 138.8 crore in the previous year and the pharma business increased to Rs 251.3 crore as compared to Rs 191.5 crore in the previous year; taking the total turnover of the company to Rs 372.2 crore as compared to Rs 330.3 crore in the previous year. The net profit for nine months is Rs 40.2 crore as compared to Rs 43.8 crore in the previous year.

Commenting on the results, Jai Hiremath, Vice Chairman and Managing Director, Hikal said, "Our pharma business has grown substantially in the last quarter. The de-stocking of inventory by our customers and the slow recovery in the US and Europe has been challenge this quarter. We expect a marked improvement in the next quarter."

Granules India

Granules India posted an increase in revenues in its Q3 results. On a consolidated basis, the company posted revenue of Rs 122.40 crore, an increase of 24.7 percent over the same period last year and a net profit of Rs 6.56 crore.

On a standalone basis, the company achieved sales of Rs 101.34 crore and a net profit of Rs 5.87 crore. This is the first time the standalone unit has crossed Rs 100 crore in sales.

"This was a record setting quarter due to strong performance from all our divisions. I am particularly excited about our formulation division, which continues to grow rapidly and now comprises over nine percent of our sales. This division will ramp up significantly over the next few quarters as we commence work on several key contracts," said C Krishna Prasad, Managing Director of Granules.

Piramal Healthcare

Piramal Healthcare reported impressive performance during Q3 2010. Total operating income on consolidated basis for the quarter ended 31 December 2009 was up by 9 percent to Rs 9.1 billion over Q3 2010. It's operating profit increased by 45 percent to Rs 1.8 billion. Similarly its operating profit margin for the quarter was higher at 19.9 percent against 15.0 percent in Q3 2010 and net profit was up by 127.5 percent to Rs 1.4 billion against Rs 598.7 million in Q3 2010. its earnings per share (EPS) for the quarter was higher at Rs 6.5 against Rs 2.9 in Q3 2010.

During the quarter, healthcare solutions (domestic formulations) division grew by 21.5 percent as compared to industry growth of 15.7 percent (source: ORG IMS nov MAT 2009) with revenues of Rs 5.0 billion. This is the sixth consecutive quarter where PHL has outperformed the industry growth. Piramal Healthcare showed impressive growth in anti-infective, dermatology, nutritionals, NSAIDs and OTC segment.

Revenues from Pharma Solutions (custom manufacturing) business on a like-to-like basis remained flat at approximately Rs 2.1 billion during Q3FY2010. The revenues from Indian facilities have grown by 42.3 percent to Rs. 1.1 billion against Rs 805.5 million in Q3FY2010. During the quarter, PHL's facility at Digwal was awarded the Confederation of Indian Industry (CII) National Award for energy efficient unit 2009.

As a result of the acquisition of Minrad, Piramal Healthcare continues to build its critical care business. Revenues from this business jumped to Rs 778.5 million during the quarter against Rs. 295.6 million in Q3FY2010.

Dr. Reddy's Laboratories

Dr Reddy's Laboratories reported its third quarter ended December 31, 2009 under International Financial Reporting Standards (IFRS). Its consolidated revenues at Rs. 17.3 billion ($373 million) in Q3FY2010as against Rs. 18.4 billion ($397 million) in Q3FY09, representing a decline of six percent excluding revenues from sumatriptan in the previous year, the 17 percent growth is largely driven by the key markets of India and Russia in Global Generics and PSAI.

The company's consolidated revenues for nine months FY2010 stood at Rs 53.9 billion ($1.2 billion); YoY growth of nine month. Loss for the quarter is at Rs 5.2 billion ($112 million) while Adjusted PAT for the quarter is at Rs 2.3 billion ($50 million). Adjusted PAT for nine months of this fiscal is at Rs 7.3 billion ($158 million) as against adjusted PAT of Rs. 5.1 billion ($110 million) in the same period for previous year, representing a growth of 43 percent.

During the quarter, many healthcare insurance providers in Germany announced their final tender results indicating a higher pace of transition to the tender based model in the German generics pharma market, with an associated significant deterioration in prices from the previous year's levels. As a result of this, the carrying value of betapharm's goodwill and intangibles were tested for impairment. A non-cash write-down of intangible assets and 'beta' brand amounting to Euro 48 million and a non-cash write-down of goodwill amounting to Euro 76 million were recorded for the quarter. The overall net impact on Income Statement was Euro 109 million after a reversal of deferred tax liability relating to intangibles and 'beta' brand.

Jubilant Organosys

Jubilant Organosys announced its business reorganization strategy and its financial results for Q3 and nine months. The company is de-merging its non-core business - agri and performance polymer - into a separate subsidiary to focus on its pharma business.

Its Q3 revenues grew by 5.7 percent and were at Rs 961.5 crore against Rs 909.6 crore last year. The PLSPS (Pharma & Life Sciences) segment grew at 13 percent to Rs 858.2 crore from Rs 759.5 crore. Its international sales formed 64.9 percent of the company's total revenues. In Q3FY 2010 international sales grew by 8.5 percent and stood at Rs 624.2 crore from Rs 575.1 crore in Q3FY 2009.

The company's nine months FY2010 net profits were at Rs 284.3 crore against loss of Rs 137.5 crore last year. The respective basic EPS was at Rs 19.27 against Rs (9.34) last year.

During the Q3FY2010, its EBITDA grew up by 52.1 percent and stood at Rs 237.9 crore from Rs 156.4 crore earlier. The EBITDA margin stood better by 750 bps at 24.7 percent from 17.2 percent last year.

Net Profits in Q3FY 2010 grew by 215.1 percent and stood at Rs 100.8 crore from a loss of Rs 87.6 crore last year. The respective basic EPS was at Rs 6.83 in Q3FY2010 against Rs 5.95 last year.

Shyam S Bhartia, Chairman and Managing Director and Hari S Bhartia, Co-Chairman and Managing Director, Jubilant Organosys said, "Our performance was led by healthy growth in the PLSPS business. The biggest contribution to revenue came from CRAMS, which benefited from robust volume growth. The performance was strong in the CMO business where we have started delivery against the new contracts. PLSPS has thus witnessed a strong increase in EBITDA margins as a result of expansion in CRAMS margins and margin stabilization in Life Sciences Chemicals. "

Ipca Laboratories

Ipca Laboratories announced its unaudited financial results for Q3FY2009-10. Its net profit for this period stood at Rs 396.61 crore as against Rs 313.63 crore with growth of 26 percent. The company's export income touched Rs 201.21 crore in Q3FY10 as against Rs 169.97 crore in similar period of last year with growth rate of 18 percent. The company earned Net Profit of Rs 58.25 crore in Q3FY2009-10 as against Rs. 23.18 crore in cumulative period of last year with growth of 151 percent.

Venus Remedies

Venus Remedies reported a rise of 10.22 percent in its net profit for Q3FY2009-10to Rs 10.93 crore compared to 9.92 crore posted in the same period of last year. Operating profit stood at Rs. 17.56 crore, an increase of 19.05 percent compared to Rs 14.75 crore in the corresponding period last year.

The company reported net sales of Rs 76.48 crore, compared to Rs. 65.12 crore in corresponding period of last financial year, a growth of 17.4 percent. Its EPS rose from Rs 11.74 to Rs. 12.91 (not annualized).

During this quarter the company added another product patent for Potentox in its strong IPR basket from South Africa. Venus Remedies has submitted 49 product dossiers for registration in 30 countries across the globe. It has marked presence in 22 countries of Latin America, South East Asia, Africa and Middle East by getting registrations of 32 products. Venus has also submitted 26 CTD dossier for registration in European Union for its product Carbapenem and anti-cancer which has a good market in Europe.

Elder Pharmaceuticals

Elder Pharma's Q3FY2010 revenues increased by 17 percent at Rs. 179.9 crore as compared to Rs 153.70 crore in the corresponding quarter last year. Its net profit for the quarter under review stood at Rs 15.37 crore up by 18 percent in comparison with Rs 13.01 crore in the corresponding quarter last year.

For the period of nine months FY2010, company's revenues went up by 13.5 percent at Rs 512.2 crore in comparison with Rs 451.20 crore in the corresponding period of nine-month in the previous year. Net profit for the nine-month period under review stood at Rs 38.44 crore.