The company said the net profit was adversely impacted by one-time deferred tax adjustment of Rs. 513 crores related to changes in US tax rates. US slashed corporate tax rate from 35 percent to 21 percent.
Sun Pharmaceutical Industries, India’s largest drug maker on Wednesday reported 75.2 percent drop in net profit to Rs 365.4 crore in the quarter ended December hit by plunging US sales and one-time deferred tax adjustment.
The company posted a net profit of Rs 1,472 during the corresponding period a year ago. Revenues from operations declined 16 percent to Rs 6,653.23 crore, compared to Rs 7,925.11 crore a year ago .
The company said net profit was adversely impacted by one-time deferred tax adjustment of Rs 513 crores related to changes in US tax rates. US slashed corporate tax rate from 35 percent to 21 percent.
The EBITDA margin of the company stood at 21.2 percent.
The net profit was far lower than CNBC-TV18 poll estimates of Rs 878.3 crore.
“Our Q3 performance reflects a gradual improvement in profitability over the first half of this year, despite a challenging US generic pricing environment,” said Dilip Shanghvi, Managing Director of Sun Pharma.
Sales in US fell 35 percent to USD 328 million for the third quarter on a year-on-year (YoY) basis. US accounted for 32 percent of total sales.
“This decline was driven by the overall pricing pressure in the US generics market and the YoY reduction in sales of generic Imatinib and Olmesartan authorized generics,” the company said
Sun Pharma's key new approvals have been held back as the key Halol facility still reels under the weight of a warning letter from the US FDA. The company has invited US FDA for re-inspection.
Sun Pharma in US has 418 ANDAs approved, while filings for 126 ANDAs await US FDA nod, including 14 tentative approvals. For the quarter, 4 ANDAs were filed and 5 approvals were received.
The pipeline also includes 37 approved NDAs while 4 NDAs await US FDA approval.
Sale of branded formulations in India was up 6 percent to Rs 2,085 crores led by a gradual recovery post the implementation of GST in India; the underlying growth remains robust. India formulation business contributes 32 percent of Sun Pharma’s revenues.
Sun Pharma is the largest drug maker by sales holding around 8.5 percent market share in the over Rs 116,000 crore Indian pharmaceutical market as per December 2017 AIOCD-AWACS report.
The drug maker saw emerging market sales grow at 10 percent to USD 189 million for Q3 on back of its Biosintez acquisition in Russia.
The rest of the world formulation business grew 6 percent to USD 120 million partly boosted by the consolidation of revenues from the acquisition of 14 brands from Novartis in Japan.
The company's sales in emerging markets were at USD 189 million for Q3; a growth of 10 percent compared to the same quarter last year. Consolidated R&D investments for Q3FY18 was Rs 473 crores, or 7.2 percent of sales.
This R&D expenditure includes investments on account of funding the clinical development of our global specialty pipeline.
“During the quarter, we took another step forward in enhancing our specialty business by reporting acceptance of NDA filing for OTX-101 by the US FDA,” Shanghvi said.
Shanghvi said his company will continue to “evaluate opportunities” in the specialty segment to further enhance this business.Shares of Sun Pharma declined 2.53 percent to close at Rs 574.45 on BSE, the benchmark Sensex declined 0.42 percent to end 34,155.95 points.