Dr Reddy’s posts Rs 1.7 billion net profits in Q4 2009-2010; US sales drop

India’s second largest pharma company Dr Reddy’s Laboratories reported a net profit of 1.7 billion rupees ($37 million) in the quarter to March, its fiscal fourth quarter, compared with a loss of 9.8 billion last year.

Dr Reddy’s consolidated net sales increased marginally by 0.9 per cent to Rs 6,852 crore from Rs 6,790 crore in the previous year due to lower sales in North America and Europe.

Dr Reddy’s sales in the United States, its biggest export market, nearly halved to 3.5 billion and European revenue declined by a third to 2.1 billion.

Excluding the revenues from authorized generic sales of sumatriptan, the growth is at 8 per cent, which is driven largely by the branded generics markets. Its revenues from North America declined by 15.2 per cent to Rs 1,680 crore from Rs 1,980 crore.

The company’s earnings before depreciation, interest, taxation and exceptional items (EBDITA) improved by 8.5 per cent to Rs 1,520 crore from Rs 1,401 crore in the previous year.

The earnings per share worked out to positive Rs 20.83 as against negative Rs 54.48 in the last year. The company management recommended equity dividend of 225 per cent i.e. Rs 11.25 per share of the face value of Rs 5 each.

Dr Reddy’s has cut down its R&D expenditure by almost 9 per cent to Rs 373.07 crore during FY2010 from Rs 409.27 crore.

The company’s revenues from global generics segment declined by 2 per cent to Rs 4,860 crore.

Dr Reddy’s revenues from Europe declined by 19 per cent to Rs 960 crore from Rs 1,190 crore mainly due to declined in German sales by 26 per cent to Rs 730 crore. Its sales in rest of the Europe, however, improved by 17 per cent to Rs 230 crore, largely led by the 14 per cent growth in UK.

The company’s sales in Russia and CIS market improved by 20 per cent to Rs 910 crore from Rs 760 crore in the previous year. DRL’s sales in Russia increased by 25 per cent to Rs 720 crore from Rs 580 crore.

Dr Reddy’s domestic sales improved by 20 per cent to Rs 1,020 crore from Rs 850 crore led by volume growth across products and new product launches. It launched 62 new products during 2009-10 contributing to 5 per cent to its sales.

The company’s sales of pharmaceutical services and active ingredients (PSAI) increased by 9 per cent to Rs 2,040 crore.

The company’s cumulative ANDA fillings reached at 158 with 73 ANDAs pending approval at the US FDA of which 38 are Para Ivs and 12 are FTFs.

It filled 36 DMFs globally, with 19 in US, five in Canada, eight in Europe and four in rest of the world. The cumulative DMF fillings as of March 2010 reached at 375.

The company’s standalone net sales for the year ended March 2010 increased by 10 per cent to Rs 4,401 core from Rs 4,000 crore in the previous year. Its standalone net profit improved by 50.8 per cent to Rs 846 crore from Rs 561 crore. As against the equity capital of Rs 84.42 crore its standalone reserves and surplus amounted to Rs 5,830 crore during 2009-10 as compared to Rs 5,175 crore in the previous year.