Piramal Healthcare posted 9% growth in net sales to Rs 850.91 crore for the quarter ended March 2009. Operating Profit margins crashed by 650 bps to 21.0% on the back of R & D expenses of Rs 20.18 crore as against R & D income of Rs 40.48 crore in the corresponding pervious period. Resulting operating profit declined by 17% to Rs 178.44 crore. Other income stood at Rs 7.21 crore as against Rs 0.03 crore in the corresponding pervious quarter. Finally, net profit has decline by 13% to Rs 114.90 crore.
Other Highlights
- Domestic formulation business posted a growth of 28% to Rs 394.90 crore for the quarter.
- Custom Manufacturing division declined by 2% to Rs 302.13 crore and contributed 35.5% to total sales.
- During the quarter, company completed the acquisition of Minrad international and RxElite. After Minrad acquisition, company separated Global Critical care business as another segment.
- PHL has consolidated its Huddersfield operation and started other cost saving initiatives at Morpeth facility in the quarter under review. It expects an improvement of 6-8% in CMO EBIDTA margins for FY’10.
- The company raised around Rs 623 crore in the FY’09 for acquisition of Minrad and RxElite. Debt on the books as on 31st March’09 is around Rs 13408 crore. Out of this, Rs 660 crore in the Rupee denominated debt and Rs 680 crore is foreign currency denominated debt.
- In the concall conducted on 22nd January 2009, company gave a guidance for Pharma solution sales from Indian assets as Rs 370 crore and revenue growth of 16%. In the case of Pharma solution sales from Indian assets touched Rs 390 crore and revenue grow by 14%.
- Company incurred regular capex of Rs 190 crore and additional capex of Rs 710 crore for acquisitions for FY’09.
- The sales force of Domestic formulation division is 4000.
- Company has launched 42 new products in Indian market during the year. Top 10 brands contributed 24.3% of FY’09 sales and Lifestyle products contribute 31.4% of FY’09 sales. New products launched during the last 24 months contributed 7.9% of sales.
- The tax rate for FY’10 would be around 11%-12%.
- Cash on the books as on 31st March’ 2009 is around Rs 90-100 crore.
- The 25% of total supply contracts with Pfizer are completed, and company has successfully extended completed contracts. It also started negotiations with Pfizer for remaining contracts will in advance.
- During the company has commissioned new early phase formulation development facility at Ahmedabad.
- In Pharma solution business (CMO) currently, 14 products are in Pre-clinical stages, 57 in Phase I, 81 in Phase II and 19 are in Phase III stage.
- Baxter sued Minrad in January 2009 on Desflurane ANDA with Para IV change filed to US FDA. So company unable to launch Desflurane in FY’2010. Due to that company has cut down its guidance & EBIDTA margins for FY’10 of Minrad to USD 55-60 millions and 20-22% from USD 65 millions and 25%.
- Debt to Equity ratio as on 31st March’09 is 1. The company expects to bring it down to 0.7 by 31 st March’10.
- The company has no plans for further acquisition in the current financial year.
- Company expects CMO business will perform well in the second half of the current financial year.
- Expects Capex for FY’10 would be around Rs 175 crore.
- Expects pharma solutions to be around Rs 1000 crore.
- EBIDTA margins to be 21-22%.
- Expects a revenue growth of 16-17% for FY’10