Orchid’s Q1 FY07-08 net profit surges by 252% to Rs 51cr

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Standalone earnings for the quarter ended June 30, 2007

 

Orchid Chemicals & Pharmaceuticals Ltd. (Orchid) achieved a total income of Rs 291.36 crore (including the foreign exchange gain) for the quarter ended June 30, 2007 (Q1 FY07-08) in comparison to Rs 202.49 crore registered during the corresponding first quarter of last fiscal. Gross profit before interest, depreciation and tax was Rs 115.38 crore compared to Rs 58.79 crore during the corresponding quarter of last year, registering a 96% increase. Profit before tax (PBT) was Rs 75.91 crore as against Rs 17.44 crore of the Q1 of last fiscal registering a 335% increase. Profit after tax increased by 252% to Rs 51.30 crore compared to Rs 14.59 crore of Q1 last fiscal. The first quarter figures of this fiscal include the foreign exchange gain on Foreign Currency Convertible Bonds (FCCBs) of Rs 52.86 crore which had a net impact on the profit after tax of Rs 33.77 crore.

 

Consolidated earnings for the quarter ended June 30, 2007

 

On a consolidated basis, Orchid's total income stood at Rs 304.63 crore (including the foreign exchange gain) for the quarter ended June 30, 2007 in comparison to Rs 213.40 crore registered during the corresponding first quarter of last fiscal. Gross profit before interest, depreciation and tax increased by 103% to Rs 113.52 crore compared to Rs 55.98 crore during the corresponding quarter of last year. Profit before tax was Rs 73.21 crore as against Rs 13.68 crore of the Q1 of last fiscal, registering an increase of 435%. Profit after tax increased by 349% to Rs 48.59 crore as compared to Rs 10.83 crore of Q1 last fiscal.

 

Quote from the Managing Director

 

Commenting on the results, Mr K Raghavendra Rao, Managing Director, Orchid Chemicals & Pharmaceuticals Ltd. said, "The first quarter of this fiscal was primarily marked by the launch of a key cephalosporin product with generic market exclusivity and the therapeutic expansion into the non-penicillin, non-cephalosporin segment. The quarter also witnessed a steady rise in the rate of regulatory filings both for the US and EU markets. With our foray into the niche penicillin injectables segment coupled with a few more key generic launches in the US during the ensuing quarters, we are confident of recording a step-function increase in revenues and profitability during this fiscal. The appreciation of the rupee against the dollar has impacted us more positively than negatively. The turnover would have been higher had the exchange rate remained stable. However, there has been a more significant positive income impact on account of the foreign currency convertible bond issue that we made in February 2007."

 

US Generics

 

During the quarter under review, Orchid's US generics business saw a steady growth. A significant achievement during the quarter was the approval of our ANDA (Abbreviated New Drug Application) for Cefepime injection by the US FDA and its launch as a generic product in the US in distribution partnership with Apotex. Orchid is the sole generics player in the US for this product. Orchid believes it would have this kind of sole market exclusivity position for a further period of 6 to 8 months, leading to a robust revenue and profitability profile for the fiscal. 

 

The other products launched earlier continued to post stable sales, with our marketing partners winning some major bids and contracts in the US.

 

Non-penicillin, non-cephalosporin (NPNC) segment

 

During the quarter, Orchid began its foray into the non-penicillin, non-cephalosporin (NPNC) product segment by launching its first NPNC product, Terbinafine in distribution alliance with Actavis in the US. Orchid launched the product immediately upon patent expiry based on the US FDA approval received.

 

With a cumulative filing count of 17 DMFs and 11 ANDAs in this segment, Orchid expects further launches in this product area during the ensuing quarters with additional contribution to the revenues.

 

Regulatory update

 

The regulatory filing calendar has progressed well during the first quarter of this fiscal. The cumulative count of filings as of the end of the first quarter stood at 45 DMFs (Drug Master Files) and 40 ANDAs. Of the DMFs filed 26 are in the cephalosporin area, 17 in NPNC and 2 in penicillin product segments. Of the ANDAs filed, 27 correspond to cephalosporins, 11 to NPNCs and 2 in the penicillin product segments.

 

As at the end of the current quarter of this fiscal, the number of ANDA approvals received by Orchid from US FDA stands at 20. Further ANDA approvals are expected to be received in the ensuing quarters, as they are under final stages of review by the US FDA. More DMFs and ANDAs are being lined up for filing in the forthcoming quarters. Most of the development would occur in the NPNC space with several products under various stages of API and formulation development.

 

For the EU market, Orchid has cumulatively filed 12 dossiers for MAs (Marketing Authorisations) as of the first quarter. More dossier submissions have been lined up going forward.

 

In the Canadian space, Orchid has till date filed 6 ANDS (Abbreviated New Drug Submission) applications and received US FDA approval for 3 ANDS applications. 

 

Sourced From: Orchid Chemicals & Pharmaceuticals Ltd