Strides Pharma Science slumped 7.42% to Rs 723.95 after the company reported a consolidated net loss of Rs 205.2 crore in Q1 FY22 as against a net profit of Rs 103.56 crore in Q1 FY21.
Revenue from operations declined by 12% YoY to Rs 688.36 crore during the quarter.
Total expenses increased by 17.1% to Rs 834.93 crore in Q1 FY22 over Q1 FY21, due to higher raw material costs (up 14.5% YoY) and higher other expenses (up 17.4% YoY).
The company posted a pre-tax loss of Rs 244.10 crore in Q1 FY22 as compared with a pre-tax profit of Rs 105.12 crore in Q1 FY21.
Dr R Ananthanarayanan, managing director & CEO, remarked, Q1FY22 has been an unprecedented quarter for Strides amidst multiple macro headwinds from the recent wave of COVID‐19. This has led to significant disruptions both on the demand and supply side.
The above headwinds have resulted in the company reporting an operating loss for the first time ever. While we are witnessing near term challenges due to price erosions, we are taking a number of actions to adapt to the new market realities.
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We are excited to announce signing of a definitive agreement to acquire Endo's basket of ANDA's having limited competition including controlled substances, hormones, nasal sprays, liquids, modified release, gels and oral solids along with the US manufacturing site at Chestnut Ridge, New York. The acquired portfolio will help us significantly ramp up our new product launches.
We are also undertaking various cost measures to improve our operating leverage. We are consolidating our West Palm Beach operations with site at Chestnut Ridge to deliver operational synergies. Size of the combined portfolio will help optimize R&D spends which will now be targeted towards building specialty products.
While the other regulated markets delivered a weak quarter led by significant drop in prescriptions, price challenges in key markets and supply spills owing to COVID‐19 impact at our manufacturing sites, our order book continues to remain robust and we expect a bounce back in Q2FY22.
With all the above actions we expect to see full recovery in H2FY22 driven by growth across all our businesses. We expect to end the year with a 10‐15% revenue growth over US$ 215m reported in the US for FY21.
Strides Pharma Science is a global pharmaceutical company. The company mainly operates in the regulated markets and has an 'in Africa for Africa' strategy along with an institutional business to service donor‐funded markets. The company focusses on difficult to manufacture products that are sold in over 100 countries.
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