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Orchid Chemicals and Pharmaceuticals Ltd (OCPL), which has returned to net profit from a net loss of around Rs 200 crore during the last quarter, expects its capacity utilisation to touch 100 per cent by the next quarter, up from the present 60 per cent.
The pharmaceutical maker also expects revenues from its first-to-file products in the United States, to flow from the next fiscal. "With the additional working capital coming in, we will improve both topline and the bottomline," said K Raghavendra Rao, managing director of OCPL.
The company earlier was facing a working capital crunch, which had resulted in lower capacity utilisation and had thereby affected profitability. However, with the corporate debt restructuring (CDR) package being implemented and a part of the sales deed used as working capital, the company was expecting improvement in revenues and profit, Rao said.
Last year, the company had said it had eight products, including anti-allergics, osteoporosis, anti-depression, Alzheimer's disease and anti-infectives, in the first-to-file pipeline in the US, which has a marketing advantage there.
"With the implementation of the approved CDR package and the completion of the business transfer to Hospira, we are seeing operations getting streamlined with the infusion of working capital," he said, stating the company was confident of the rebuilding process.
From the sales proceedings, of a total inflow of around Rs 1,300 crore, around Rs 681 crore had been repaid to the banks, as per the arrangement in the CDR plan. It would be repaying the rest of its debt in the future, as per the CDR package agreed by the CDR empowered group. According to earlier reports, the company had around Rs 3,500 crore debt.
The company posted a net profit of Rs 271.9 crore for the quarter ended September 30, 2014, as compared with a net loss of Rs 200.30 crore for the same quarter of the previous fiscal. However, total operating income saw a 54 per cent drop to Rs 174.9 crore for the quarter, while the total operating income for the same quarter of last year was Rs 380.4 crore.
The bottomline saw a dip due to a drop in sales of the penicillin and penem active pharmaceutical ingredients business and the API facility located in Aurangabad and Maharashtra, along with an associated process research and development infrastructure in Chennai.
