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Dr Reddy's Lab Q3 net profit dips 19% to Rs 470 crore

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Press Trust of India Hyderabad
Last Updated : Feb 04 2017 | 6:22 PM IST
Dr Reddy's Laboratories today said its net profit for the December quarter was down by 19 per cent to Rs 470 crore (as per IFRS) against Rs 579 crore during the corresponding quarter in FY16 owing to drop in North American sales.
Saumen Chakraborty, President, CFO and Global Head of HR said revenues for Q3 FY17 dropped by 7 per cent to 3,707 crore against Rs. 3,968 crore in Q3 of FY16.
Generic sales from North America registered a drop of 15 per cent to 1,660 crore during the October-December quarter resulting a drop of 9 per cent over generic sales globally, he said.
Abhijit Mukherjee, Chief Operating Officer of DRL said the growth story in USA is muted due to pricing pressures and no big launches.
"Launches in (in North America) have been lean. So going ahead we see the pipeline building well. The decline is also primarily on account of increased competition in Valgancyclovir and our injectable franchise coupled with continuing pricing pressure," Mukherjee told reporters here.
He said sales from India did not grow much due to demonetisation of higher value currency notes.

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"Demonetisation has its impact. The industry itself has not done well, so we were also impacted. But the situation is coming back to normal during this quarter," Mukherjee added.
Revenues from India stood at 590 crore in Q3 with 2.4 per cent growth over last year same quarter.
Replying to a query, Mukherjee said they expect the US FDA to inspect their three plants which were earlier issued warning letters before March.
"We are preparing for the US FDA inspection before February and March. The priority is see that they are successfully completed," he added.
DRL's Co-Chairman and CEO GV Prasad in a statement said, "Our performance in Q3 has delivered a modest sequential revenue growth of 3 per cent over the previous quarter. Our EBITDA improved significantly from the last quarter to Rs. 8.8 billion (Rs 880 crore), on the back of enhanced emphasis on operational efficiencies and controlling of SG and A costs across all our businesses."
Chakraborty said the drug maker spent Rs 460 crore on research and development during the last quarter which is about 13.4 per cent of the total sales.
Generic sales from rest of the world including Russia and other CIS countries stood at 5,95 crore showing 23 per cent growth over last year same quarter.
Europe showed 21 per cent growth in sales to Rs 215 crore, while pharmaceutical services and active ingredient revenues dropped by 7 per cent in Q3 to 540 crore.

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First Published: Feb 04 2017 | 6:22 PM IST

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