Dr. Reddy's Q3 FY12 Financial Results

Dr. Reddy's Q3 FY12 Financial Results
Highest ever quarterly sales and profit

Hyderabad, India, February 03, 2012: Dr. Reddy's Laboratories Ltd. (NYSE: RDY) today announced its unaudited consolidated financial results for the quarter ended December 31, 2011 under International Financial Reporting Standards (IFRS).
 
Key Highlights
•Launch of olanzapine 20 mg (generic version of Eli Lilly's Zyprexa® 20 mg) in the US, another key milestone in consistently delivering limited competition opportunities

 • Revenues for Q3 FY12 at ₹ 27.7 billion ($522 million), YoY growth of 46% ◦Revenues for nine months FY12 at ₹70.2 billion ($1.3 billion), YoY growth of 29%.


 

  • EBITDA for Q3 FY12 at ₹ 9.2 billion ($174 million), 33% to sales, YoY growth of 127%

◦EBITDA for nine months FY12 at ₹18.6 billion ($351 million), 27% to sales, YoY growth of 59%.

 


 

  • Adjusted* PAT for Q3 FY12 at ₹ 5.2 billion ($98 million), YoY growth of 91%

◦Adjusted* PAT for nine months FY12 at ₹11.1 billion ($209 million), YoY growth of 44%.
 
• Q3 FY12 - 33 new generic launches, 16 new generic filings and 7 DMF filings

 

 
*Note: Adjustments on account of interest on bonus debentures (net of tax)

 All figures in millions, except EPS
All dollar figures based on convenience translation rate of 1USD = ₹ 53.01

Dr. Reddy's Laboratories Limited and Subsidiaries

Unaudited Consolidated Income Statement

 

Particulars

Q3 FY12

Q3 FY11

Growth %

 

($)

(₹)

%

($)

(₹)

(%)

 

Revenue

522

27,692

100

358

18,985

100

46

 

Cost of revenues

210

11,117

40

162

8,571

45

30

 

Gross profit

313

 

 

16,575


60

196

10,414

55

59

 

Operating Expenses

 

 

 

 

 

 

 

 

Selling, general & administrative expenses

145

7,679

28

120

6,374

34

20

 

Research and development expenses

29

1,514

5

25

1,306

7

16

 

Other operating (income) / expense

(3)

(165)

(1)

(4)

(199)

(1)

(17)

 

Results from operating activities

142

7,547

27

55

2,933

15

157

 

Net finance (income) / expense

(3)

(174)

(1)

1

48

0

-

 

Share of (profit) / loss of equity accounted investees

(0)

(26)

(0)

0

1

0

-

 

Profit / (loss) before income tax

146

7,747

28

54

2,884

15

169

 

Income tax (benefit) / expense

49

2,616

9

3

152

1

-

 

Profit / (loss) for the period

97

5,131

19

52

2,732

14

88

 

 

Diluted EPS

0.6

30.2

 

0.3

16.1

 

88


 Profit Computation:                                                                                                                                                          (In millions)

 

 EBITDA Computation

 Q3 FY12

Q3 FY11

 

($)

(₹)

($)

(₹)

 

 PBT (reported)

146

7,747

54

2,884

 

 Interest

3

155

2

98

 

 Depreciation

17

899

14

758

 

 Amortization

8

408

6

307

 

 EBITDA

174

9,208

76

4,048

  
                                                                                                                                                                                               (In millions)


Adjusted PAT Computation

 Q3 FY12

Q3 FY11

 

($)

(₹)

($)

(₹)

 

PAT (reported)

97

5,131

52

2,732

 

 Adjustments:

 

 

 

 

 

 Interest on Bonus Debentures (net of tax)

1

78

 

 

 

 Adjusted PAT

98

5,209

52

2,732


 
 
Key Balance Sheet Items                                                                                                                                                (In millions)

 

Particulars

As on 31st Dec 11

As on 30th Sep 11

 

($)

(₹)

($)

(₹)

 

Cash and cash equivalents

313

16,587

143

7,596

 

Trade receivables

498

26,373

388

20,568

 

Inventories

369

19,586

351

18,592

 

Property, plant and equipment

612

 

 

32,433
 

593

31,450

 

Goodwill and other intangible assets

287

15,182

285

15,115

 

Loans and borrowings (current & non-current)

727

38,502

591

31,303

 

Trade payables

173

9,189

169

8,940

 

Equity

980

51,927

907

48,081


Q3 FY12 Revenue Mix by Segment                                                                                                                               (In millions)

 

 

Q3 FY12

Q3 FY 11

Growth %

 

($)

(₹)

as a %

($)

(₹)

as a %

 

Global Generics

402

21,287

77

256

13,589

72

57

 

North America

 

11,114

 

 

4,765

 

133

 

Europe

 

2,426

 

 

2,124

 

14

 

India

 

3,333

 

 

3,000

 

11

 

Russia & Other CIS

 

3,317

 

 

2,880

 

15

 

RoW

 

1,097

 

 

820

 

34

 

PSAI

105

5,563

20

94

4,979

26

12

 

North America

 

1,170

 

 

770

 

52

 

Europe

 

1,651

 

 

 

 

1,830
 

 

(10)

 

India

 

862

 

 

622

 

39

 

RoW

 

1,880

 

 

1,757

 

7

 

Others

15

842

3

8

417

2

102

 

Total

522

27,692

100

358

18,985

100

46


Q3 FY12 Revenue Mix by Geography                                                                                                                            (In millions)

 

 

Q3 FY12

Q3 FY 11

Growth %

 

($)

(₹)

as a %

($)

(₹)

as a %

 

North America

242

12,826

46

110

5,823

31

120

 

Europe

82

4,325

16

77

4,078

21

6

 

India

79

4,194

15

68

3,625

19

16

 

Russia & Other CIS

63

3,317

12

54

2,880

15

15

 

Others

56

3,030

11

49

2,579

14

17

 

Total

522

27,692

100

358

18,985

100

46

 

 

Segmental Analysis

Global Generics: North America

 Revenues from North America were at ₹ 11.1 billion in Q3 FY12 versus ₹ 4.8 billion in Q3 FY11. Growth was led by the high value launch of olanzapine 20 mg, new products launched in the last twelve months and strong volume growth across key products.

  • 2 new products launched during the quarter - olanzapine 20 mg and olanzapine ODT.
  • Strong volume growth contributed by key products such as lansoprazole, tacrolimus, omeprazole Mg OTC and Shreveport products and last twelve months new launches of fondaparinux and antibiotics portfolio.
  • 26 prescription products feature among the Top 3 in market share (Source: IMS Volumes November 2011).

•During the quarter, 3 ANDAs were filed. The cumulative ANDA filings as of 31st December, 2011 are 187. A total of 79 ANDAs are pending for approval with the USFDA of which 40 are Para IVs and 10 are FTFs.

 

Global Generics: Russia & Other CIS
 Revenues in Russia & Other CIS markets were at ₹ 3.3 billion in Q3 FY12 versus ₹ 2.9 billion in Q3 FY11.

  • Revenues in Russia were at ₹ 2.8 billion in Q3 FY12. Growth was largely driven by rupee depreciation.

◦The company's secondary sales growth at 23% continued to outperform industry's growth of 19%. (Source: Pharmexpert Prescription Sales November 2011).
◦Top 5 products feature among Top 2 ranks in market share.
◦OTC portfolio grew by 24% over previous year.
• Revenues in Other CIS markets were at ₹ 557 million in Q3 FY12, driven largely by Ukraine and Kazakhstan.

 

Global Generics: India

Revenues in India were at ₹ 3.3 billion in Q3 FY12 versus ₹ 3.0 billion in Q3 FY11, driven by volume increase in key products and new product launches in the last twelve months.

  • 6 new products launched during the quarter.

•Biosimilars portfolio grew by 25% over previous year

 

Global Generics: Europe
Revenues from Europe were at ₹ 2.4 billion in Q3 FY12 versus ₹ 2.1 billion in Q3 FY11.

  • Revenues from Germany were at ₹ 1.5 billion in Q3 FY12. Growth in new product launches outside the scope of tender was offset by price erosion in products within tenders.
  • Revenues from Rest of Europe were at ₹ 881million

Pharmaceutical Services and Active Ingredients (PSAI)
Revenues from PSAI were at ₹ 5.6 billion in Q3 FY12 versus ₹ 5.0 billion in Q3 FY11. Growth was largely driven by Pharmaceutical Services segment and benefit of rupee depreciation.

  • During the quarter, 7 DMFs were filed globally including 2 in US, 2 in Europe and 3 in rest of the markets. The cumulative DMF filings as of 31st December 2011 are 513 globally.

 Income Statement Highlights:

  • Gross profit margin 60% to revenues in Q3 FY12, increased largely on account of a favorable mix of high margin olanzapine revenues and benefit of rupee depreciation.
  • Selling, General & Administration (SG&A) expenses including amortization at ₹ 7.7 billion ($145 million) increased by 20% over Q3 FY11. This increase is on account of higher manpower and freight costs and the effect of rupee depreciation against multiple currencies.
  • Net Finance income at ₹ 174 million ($3 million) in Q3 FY12 versus net Finance cost of ₹ 49 million ($1 million) in Q3 FY11. The change is on account of.

◦Net forex gain of ₹ 285 million ($5 million) in Q3 FY12 versus net forex loss of ₹ 45 million ($1 million) in Q3 FY11.
◦Net interest expense of ₹ 155 million ($3 million) in Q3 FY12 versus ₹ 98 million ($2 million) in Q3 FY11.
◦Profit on sale of investments of ₹ 44 million ($1 million) in Q3 FY12 versus ₹ 4 million in Q3 FY11.
 

  • EBITDA of ₹ 9.2 billion ($174 million) in Q3 FY12, represents 33% of revenues and recorded a year-on-year growth of 127%. EBITDA of ₹ 18.6 billion ($351 million) for nine months ended December 2011, represents 27% of revenues and recorded a year-on-year growth of 59%.
  • Profit after Tax adjusted for interest on bonus debentures (net of tax), was at ₹ 5.2 billion ($98 million) in Q3 FY12, 19% of revenues and year-on-year growth of 91%. Adjusted PAT for nine months ended December 2011 was ₹ 11.1 billion ($209 million) and recorded year-on-year growth of 44%.
  • Adjusted EPS for Q3 FY12 was ₹ 30.6 ($0.6) versus ₹ 16.1 ($0.3) in Q3 FY11. Adjusted EPS for nine months ended December 2011 was ₹ 65.1 ($1.2).
  • Capital expenditure for nine months ended December 2011, was ₹ 5.0 billion ($94 million).

 
Consolidated Income Statement: Nine months ending December 2011

 

All figures in millions, except EPS
 All US dollar figures based on convenience translation rate of 1USD = ₹ 53.01
 

 

Particulars

9 Months FY12

9 Months FY11

Growth %

 

($)

(₹)

%

($)

(₹)

(%)

 

Revenue

1,323

70,153

100

1,028

54,520

100

29

 

Cost of revenues

581

30,818

44

475

25,206

46

22

 

Gross profit

742

39,335

56

553

29,314

54

34

 

Operating Expenses

 

 

 

 

 

 

 

 

Selling, general & administrative expenses

409

21,651

31

331

17,562

32

23

 

Research and development expenses

79

4,170

6

67

3,569

7

17

 

Other operating (income) / expense

(11)

(567)

(1)

(11)

(602)

(1)

(6)

 

Results from operating activities

266

14,081

20

166

8,786

16

60

 

Net finance (income) / expense

(1)

(78)

(0)

5

262

0

-

 

Share of (profit) / loss of equity accounted investees

(1)

(43)

(0)

(0)

(7)

(0)

514

 

Profit / (loss) before income tax

268

14,202

20

161

8,531

16

66

 

Income tax (benefit) / expense

63

3,366

5

16

836

2

303

 

Profit / (loss) for the period

204

10,836

15

145

7,695

14

41

 

 

Diluted EPS

1.2

63.7

 

0.9

45.3

 

41

 
Profit Computation                                                                                                                                                            (in millions)
 


EBITDA Computation

 9 Months FY12

9 Months FY11

 

($)

(₹)

($)

(₹)

 

PBT (reported)

268

14,202

161

8,531

 

Interest

11

601

2

95

 

 Depreciation

49

2,606

41

2,174

 

 Amortization

23

1,202

17

912

 

 EBITDA

351

18,611

221

11,712

 

 

Adjusted PAT Computation

9 Months FY12

9 Months FY11

 

($)

(₹)

($)

(₹)

 

PAT (reported)

204

10,836

145

7,695

 

Adjustments:

 

 

 

 

 

 Interest on Bonus Debentures (net of tax)

5

235

 

 

 

 Adjusted PAT

209

11,071

145

7,695


 
 

 

About Dr. Reddy's

 

 


Dr. Reddy's Laboratories Ltd. (NYSE: RDY) is an integrated global pharmaceutical company, committed to providing affordable and innovative medicines for healthier lives. Through its three businesses - Pharmaceutical Services and Active Ingredients, Global Generics and Proprietary Products - Dr. Reddy's offers a portfolio of products and services including APIs, custom pharmaceutical services, generics, biosimilars, differentiated formulations and NCEs. Therapeutic focus is on gastro-intestinal, cardiovascular, diabetology, oncology, pain management, anti-infective and pediatrics. Major markets include India, USA, Russia and CIS, Germany, UK, Venezuela, S. Africa, Romania, and New Zealand. For more information, log on to: www.drreddys.com

 

 

 

Disclaimer

 

 


This press release includes forward-looking statements, as defined in the U.S. Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current expectations and projections about future events. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially. Such factors include, but are not limited to, changes in local and global economic conditions, our ability to successfully implement our strategy, the market acceptance of and demand for our products, our growth and expansion, technological change and our exposure to market risks. By their nature, these expectations and projections are only estimates and could be materially different from actual results in the future.


Contact Information

Investors and Financial Analysts:

Kedar Upadhye at [email protected] or on +91-40-66834297
Raghavender R at [email protected] or on +91-40-49002135
 Milan Kalawadia (North America) at [email protected] or on +1-9082034931


Media
Rajan S at [email protected] or on +91-40- 49002445


Note: All discussions in this release are based on unaudited consolidated IFRS financials.


 
 

 

 

 

 

 

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