Moneycontrol Bureau
Healthcare firm Ranbaxy Laboratories, which has been struggling for drug production due to USFDA issues, reported a net loss of Rs 159 crore for the fourth quarter (October-December) on account of inventory provision for Toansa and higher tax expenses. But the loss reduced significantly compared to loss of Rs 486.55 crore in same quarter last year due to foreign exchange gain and healthy growth in US business.
The company has changed its financial year to March as against December earlier; hence it was fourth quarter of CY13.
After the US Food and Drug Administration (USFDA) prohibited for manufacturing and distributing active pharmaceutical ingredients (API) from its Toansa facility, the company made provisions for the financial impact amounting to Rs 257.43 crore during the quarter.
Toansa was the fourth plant of the company after Mohali, Dewas and Poanta received USFDA import alert.
While addressing press conference, Ranbaxy said the impact of this will be limited, adding last year more than 85 percent business was not dependent on Toansa API while only 10-12 percent of US sales was dependent on that.
"The company has advanced the investigation of the findings of the USFDA (as contained in Form 483) and has submitted its response to the USFDA on February 3," the company said in its release.
Arun Sawhney, CEO and MD said the company will do whatever is necessary to address all concerns of the USFDA and are committed to resolve them as early as possible.
The loss was squeezed due to foreign exchange gain of Rs 103.6 crore during October-December quarter as against forex loss of Rs 179.9 crore in corresponding quarter of last fiscal. The higher loss in December quarter 2012 was because of the company had reported a product recall worth Rs 185.95 crore.
Analysts had expected the company to report a profit of Rs 98 crore on revenues of Rs 2,815 crore for the quarter.
Total income from operations grew 6.7 percent to Rs 2,894 crore during the quarter as against Rs 2,711.2 crore in a year ago period.
"Branded and OTC category contributed Rs 1,480 crore accounting for 52 percent of total sales while generics including API category recorded Rs 1,380 crore of sales during the quarter," the company elaborated its sales performance.
The company maintains strong market share in Absorica (uses for treatment of severe recalcitrant nodular acne in patients 12 years of age and older), isotretenoin NDA in the USA. As of December 27, 2013, the market share was at 17.2 percent.
"US sales rose due to high traction in Absorica. North American sales were up 5 percent during the quarter Y-o-Y," the company said.
Operational performance of the drug major was better than analysts' expectations due to lower total expenses that fell 0.9 percent on yearly basis to Rs 2,715.15 crore in the quarter gone by.
Consolidated operating profit or earnings before interest, tax, depreciation and amortisation more than trebled to Rs 270 crore compared to Rs 81 crore and operating profit margin expanded 630 basis points year-on-year to 9.3 percent during December quarter.
"Ranbaxy has been strengthening its base business in key markets including India, Eastern Europe & CIS and the USA which has helped company recover margin," Arun Sawhney, CEO and MD said.
Other income halved to Rs 35.24 crore from Rs 76.7 crore, which included gain of Rs 9.6 crore on account of integration of Unichem with Daiichi Sankyo Thailand. Unichem is a associate company of Ranbaxy.
Tax expenses increased to Rs 98.14 crore from Rs 34 crore while finance cost declined to Rs 120.6 crore compared to Rs 135.65 crore year-on-year.
At 13:13 hours IST, the stock was up 6.12 percent to Rs 341.45 amid large volumes on the BSE.
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