HYDERABAD, India
Dr. Reddy’s Laboratories Ltd. (BSE: 500124 | NSE: DRREDDY | NYSE: RDY) today announced its consolidated financial results for the second quarter and half year ended September 30, 2016 under International Financial Reporting Standards (IFRS).
Q2 FY17: Key Highlights
- Revenues at Rs. 35.9 billion: QoQ growth: 11%
- YoY decline: 10%
- Gross Profit Margin at 56.0%. Lower by ~530 bps versus the same quarter last year
- Research & Development (R&D) spend at Rs. 5.2 billion. [14.5% of Revenues]
- Selling, general & administrative (SG&A) expenses at Rs. 11.8 billion [YoY increase: 6%]
- Includes NPPA provision of Rs. 344 million, explained in details in the note
- EBITDA at Rs. 6.4 billion [17.9% of Revenues]
- Profit after tax at Rs. 2.9 billion [8.2% of Revenues]
H1 FY17: Key Highlights
- Revenues at Rs. 68.2 billion
- YoY decline: 12%
- Gross Profit Margin at 56.1%. Lower by ~510 bps versus H1 FY16
- Research & Development (R&D) spend at Rs. 10.0 billion. [14.7% of Revenues]
- Selling, general & administrative (SG&A) expenses at Rs. 24.1 billion [YoY increase: 9%]
- EBITDA at Rs. 10.4 billion [15.2% of Revenues]
- Profit after tax at Rs. 4.2 billion [6.2% of Revenues]
Commenting on the results, Co-chairman and CEO, G V Prasad said, “All our major businesses have shown sequential improvement over the previous quarter with revenues growing by 11% and EBITDA by 61%. We have made considerable progress in our remediation efforts and continue to work on addressing the concerns of the regulators. Looking ahead we will continue to focus on launching new products in our generics business, improving productivity and strengthening our quality management systems.”
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All amounts in millions, except EPS |
All US dollar amounts based on convenience translation rate of 1 USD = Rs. 66.58 |
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Dr. Reddy’s Laboratories Limited and Subsidiaries |
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| Consolidated Income Statement | |||||||||||||||||||||
| Particulars | Q2 FY 17 | Q2 FY 16 | Growth % | ||||||||||||||||||
| ($) | (Rs.) | % | ($) | (Rs.) | % | ||||||||||||||||
| Revenues | 539 | 35,857 | 100.0 | 599 | 39,889 | 100.0 | (10) | ||||||||||||||
| Cost of revenues | 237 | 15,760 | 44.0 | 232 | 15,421 | 38.7 | 2 | ||||||||||||||
| Gross profit | 302 | 20,097 | 56.0 | 368 | 24,468 | 61.3 | (18) | ||||||||||||||
| Operating Expenses | |||||||||||||||||||||
| Selling, general & administrative expenses | 177 | 11,774 | 32.8 | 166 | 11,058 | 27.7 | 6 | ||||||||||||||
| Research and development expenses | 78 | 5,214 | 14.5 | 67 | 4,473 | 11.2 | 17 | ||||||||||||||
| Other operating expense / (income) | (4) | (277) | (0.8) | (5) | (320) | (0.8) | (13) | ||||||||||||||
| Results from operating activities | 51 | 3,386 | 9.4 | 139 | 9,257 | 23.2 | (63) | ||||||||||||||
| Finance expense / (income), net | (5) | (365) | (1.0) | 3 | 216 | 0.5 | (269) | ||||||||||||||
| Share of (profit) of equity accounted investees, net of income tax | (1) | (84) | (0.2) | (1) | (57) | (0.1) | 49 | ||||||||||||||
| Profit before income tax | 58 | 3,835 | 10.7 | 137 | 9,098 | 22.8 | (58) | ||||||||||||||
| Income tax expense | 13 | 885 | 2.5 | 28 | 1,880 | 4.7 | (53) | ||||||||||||||
| Profit for the period | 44 | 2,950 | 8.2 | 108 | 7,218 | 18.1 | (59) | ||||||||||||||
| Diluted EPS | 0.27 | 17.76 | 0.63 | 42.20 | (58) | ||||||||||||||||
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EBITDA Computation |
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| Particulars | Q2 FY 17 | Q2 FY 16 | ||||||||||
| ($) | (Rs.) | ($) | (Rs.) | |||||||||
| Profit before income tax | 58 | 3,835 | 137 | 9,098 | ||||||||
| Interest (income) / expense net* | (5) | (329) | (3) | (172) | ||||||||
| Depreciation | 28 | 1,897 | 24 | 1,606 | ||||||||
| Amortization | 14 | 950 | 13 | 860 | ||||||||
| Impairment | 1 | 67 | – | – | ||||||||
| EBITDA | 96 | 6,420 | 171 | 11,392 | ||||||||
| EBITDA (% to sales) | 17.9 | 28.6 | ||||||||||
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* – Includes income from Investments |
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Key Balance Sheet Items |
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| Particulars | As on 30th Sep 16 | As on 30th June 16 | ||||||||||
| ($) | (Rs.) | ($) | (Rs.) | |||||||||
| Cash and cash equivalents and Other current Investments | 321 | 21,379 | 384 | 25,578 | ||||||||
| Trade receivables | 555 | 36,939 | 533 | 35,499 | ||||||||
| Inventories | 428 | 28,516 | 419 | 27,922 | ||||||||
| Property, plant and equipment | 842 | 56,052 | 825 | 54,951 | ||||||||
| Goodwill and Other Intangible assets | 762 | 50,766 | 425 | 28,284 | ||||||||
| Loans and borrowings (current & non-current) | 908 | 60,480 | 565 | 37,632 | ||||||||
| Trade payables | 184 | 12,281 | 191 | 12,723 | ||||||||
| Equity | 1,731 | 1,15,264 | 1,714 | 1,14,112 | ||||||||
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All amounts in millions, except EPS |
All US dollar amounts based on convenience translation rate of 1 USD = Rs. 66.58 |
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Revenue Mix by Segment [Year on year] |
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| Particulars | Q2 FY 17 | Q2 FY 16 | Growth % | ||||||||||||||||||
| ($) | (Rs.) |
% |
($) | (Rs.) |
% |
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| Global Generics | 435 | 28,995 | 81 | 492 | 32,768 | 82 | -12 | ||||||||||||||
| North America | 16,134 | 18,563 | -13 | ||||||||||||||||||
| Europe* | 1,776 | 2,124 | -16 | ||||||||||||||||||
| India | 6,251 | 5,464 | 14 | ||||||||||||||||||
| Emerging Markets# | 4,834 | 6,617 | -27 | ||||||||||||||||||
| PSAI | 87 | 5,784 | 16 | 89 | 5,918 | 15 | |||||||||||||||