Drug major Dr Reddy's Laboratories today said its consolidated net profit declined by 85.6 per cent to Rs 74.6 crore for the March quarter on account of provisioning for outstanding receivables from the Venezuelan market.
The company had reported Rs 518.8 crore net profit for the same quarter last fiscal, the company's President, CFO and Global Head of HR Saumen Chakraborty told reporters here.
Consolidated net income from sales and services declined to Rs 3,756.2 crore for the quarter under review as against Rs 3,870.4 crore in the year-ago period.
"This (provisioning) is largely due to the rules in the Venezuelan market. We are not able to repatriate full amount from the market due to rules. We are getting some. We made provisioning of about Rs 430 crore during the quarter. That has impacted the net," Chakraborty added.
He also said the revenues have been impacted due to ruble's depreciation against world currencies.
Dr Reddy's Co-chairman and CEO G V Prasad said it has been a challenging quarter for the company.
"While there is a marginal decline in revenues, there is a greater impact on profitability. This is mainly due to the provision, made as a matter of abundant precaution, to write down our outstanding receivables from Venezuela," Prasad said.
For the fiscal ended March, the company posted a net profit of Rs 2,001.3 crore as against Rs 2,217.9 crore in the same period a year earlier.
Consolidated net income from sales and services during 2015-16 stood at Rs 15,470.8 crore, compared to Rs 14,818.9 crore in the previous fiscal.
Revenues from North America for generics grew by 19 per
cent to Rs 7,540 crore during 2015-16.
"The company made 14 filings (13 ANDA and 1 NDA) during FY16. Cumulatively, 82 generic filings are pending for approval with USFDA," Chakraborty said.
Revenues (generics) from Russia declined by 29 per cent to Rs 1,060 crore in the fiscal mainly on account of ruble depreciation.
Generics revenue from India grew by 19 per cent to Rs 2,130 crore while the same from rest of the world declined by 28 per cent to Rs 940 crore on account of "calibrated" sales in Venezuela.
Revenues from pharmaceutical services and active ingredients fell by 12 per cent to Rs 2,240 crore on account of USFDA warning letters for three of its facilities.
Replying to query on the status of the warning letters, Prasad said the company is in the process of implementing the quality improvement programme across its plants.
"After we finish that, the USFDA will come and visit the plants. It would take a few months," Prasad said without specifying the time-frame.
The company spent Rs 1,780 crore on research and development during the last fiscal.
