Matrix posts Rs 87.4 lakh net loss

BS 200 SCORECARD

Matrix Laboratories incurred a consolidated net loss of Rs 87.4 lakh for the quarter ended December 2006 as against a net profit of Rs 100.48 crore in the corresponding quarter previous financial year.

Net sales, however, rose 18.4 per cent to Rs 395.25 crore from Rs 333.80 crore. Other income declined to Rs 12.75 crore from Rs 109.10 crore in the third quarter of 2005-06. Total expenditure rose 16.83 per cent to Rs 346.84 crore from Rs 296.87 crore. This includes a rise in other expenditure to Rs 82.08 crore from Rs 59.46 crore in the third quarter of 2005.

The company's expenditure on R&D increased to Rs 26.28 crore from Rs 10.45 crore.

It provided Rs 20.39 crore towards interest cost and Rs 14.82 crore for depreciation as against a provision of Rs 9.99 crore and Rs 9.42 crore, respectively, in the third quarter of 2005-06.

Matrix stated that the results for the quarter and the nine-month period are not comparable due to acquisitions made at different points in time during the last year. Further, the results for the previous periods had certain exceptional items, which impacted the profit after tax favourably by Rs 68.59 crore. The company had also transferred a manufacturing unit to Astrix Laboratories, its 50:50 joint venture with Aspen, at the end of the previous third quarter.

According to Rajiv Malik, chief executive officer, Matrix, lower earnings in the current quarter is primarily the result of lower-than-expected earnings by Docpharma NV, a 100 per cent subsidiary of the company, as well as the increased R&D spend. Docpharma's results were impacted by initial costs incurred as the company looks to expand its operations into France and Italy.

This apart, Malik said, unfavourable variances resulted in the deferment of certain outlicensing contracts, a price decrease for a key product in the Netherlands, a one-time inventory provision, a restructuring charge taken with respect to the hospital business and an unfavourable impact from income tax primarily at Docpharma contributed to the net loss.

The results include the financials of subsidiaries Matrix Laboratories BV, Matrix Laboratories NV, Docpharma NV, Matrix Singapore Pte Ltd, Mchem Group, China, Matrix Inc, USA, and Concord Biotech Ltd besides joint ventures, Astrix Laboratories Ltd and Fine Chemicals Ltd.

On a stand-alone basis, the company's pharmaceuticals business registered net sales and net profit of Rs 174.05 crore and Rs 6.65 crore, respectively, during the quarter, as against Rs 177.33 crore and Rs 95.72 crore in the same period last year.

MP Laboratories (Mauritius), a subsidiary of the US-based Mylan Laboratories Inc, had acquired 51.5 per cent of the outstanding shares of the company at Rs 306 per share from certain shareholders on January 8, 2007.