Aurobindo Pharma Q2 net profit grows 4.6% to Rs 639.5 crore

Aurobindo Pharma, India's second-largest drugmaker November 12 reported a 4.6 percent year-on-year (YoY) rise in net profit to Rs 639.5 crore in the second quarter ended September 30, on higher expenses.

The company reported a net profit of Rs. 611.4 crore in the corresponding quarter of the previous year.

Revenues rose 17.9 percent YoY to Rs. 5,600.5 crore.

The expenses rose 20 percent YoY to Rs 4744.5 crore.

The numbers were a mixed bag as per analysts estimates. Reuters Smart Estimate projected a net profit of Rs 683.1 crore and revenues of Rs 5,579.5 crore.

The EBITDA margins stood at 20.8 percent.

The research and development (R&D) spend stood at Rs 222.9 crore or 4 percent of the revenues.

Aurobindo’s net debt dropped 9.5 percent on QoQ basis to Rs 3703.5 crore.

Sales of formulation or generic drugs, which contribute about 85.6 percent of total revenue grew 21.8 percent to Rs 4,793.8 crore compared with Rs 3,934.8 crore in the year-ago period.

Sales of active pharmaceutical ingredients (API), the key raw materials that go into the manufacture of drugs, dropped 1.3 percent to Rs. 805.8 crore.

The US formulation business accounting half of Aurbindo’s revenues grew 27.3 percent YoY to Rs 2,835.5 crore. However, on a sequential basis, the US business gained 5.5 percent.

The company received final approval for three abbreviated new drug applications (ANDAs) and one tentative approval in Q2FY20.

In the first quarter, the company filed 20 ANDAs, of which two are injectable drugs.

The company has launched 10 products including three injectables during the quarter

As on September 30, 2019, on a cumulative basis, the company filed 569 ANDAs with USFDA and received approval for 416 ANDAs including 27 tentative approvals.

EU formulations contributed 25 percent to the total revenue registered a growth of 21.2 percent to Rs. 1,401.3 crore.

The antiretroviral drug sales slipped 2.5 percent to Rs 237.9 crore over the year-ago period.

“We had an another quarter of healthy performance where we continued to grow in US and Europe, which are our focused geographies. Our R&D initiatives have been progressing well across the products basket and we have started clinical trials for our first biosimilar product in Q3FY20," said N Govindarajan, Managing Director of the company.

"We reiterate that we are committed to quality adherence and are in the process of resolving all pending regulatory issues,” he added.