The Hindu Business Line : Ranbaxy posts Rs 188 cr net in fourth quarter

Flat growth: Mr Malvinder Mohan Singh, CEO and Managing Director, Ranbaxy Laboratories Ltd, and Mr Atul Sobti, COO, at a press conference in the Capital on Thursday.

Our Bureau,

New Delhi, Jan. 17 Having started the process of delisting its R&D unit, which is to come into effect in the second half of this year, Ranbaxy Laboratories today reported an almost flat result for its fourth quarter, ended December 31, 2007 with profits after tax at about Rs 188 crore, on a consolidated basis.

This represents a mere one per cent growth in bottomline for the pharmaceutical company as against Rs 185.9 crore in the corresponding quarter of the previous year. Excluding foreign exchange gains/losses on translation and extraordinary items of about Rs 11 crore, profit after taxes were at Rs 180 crore.

Consolidated net sales for the quarter grew five per cent to Rs 1,784 crore. Emerging markets grew 24 per cent, contributing 54 per cent to global sales. India, CIS Romania, South Africa and Brazil were the key drivers of growth.

According to Mr Malvinder Mohan Singh, CEO and Managing Director, Ranbaxy, the results were as per their guidance, with a EBITDA margins at 16.5 per cent to sales, beating management’s expectations. Mr Atul Sobti, COO, Ranbaxy, pointed out that the margins, the same for the entire financial year, were the highest ever for the company.

The company said it would announce structure and other details of the new entity in February. Mr Singh also added that Ranbaxy would look at unlocking value through other means too, including cashing out non-core assets.

Year-on-year

For the year ended December 31, 2007, Ranbaxy’s net profit grew more than 53 per cent from the corresponding period the previous year to Rs 790 crore. (Excluding foreign exchange gains of Rs 317 crore, losses in translation and extraordinary items, net profit for the year was at about Rs 607 crore, an increase of 15 per cent.)

Net sales for Ranbaxy were up nearly 10 per cent to Rs 6,590 crore for the year. Emerging markets grew 32 per cent, contributing 54 per cent to global sales. Ranbaxy, a leading generic player, saw its sales in the US grow two per cent to $386 million. European markets did better, growing at 24 per cent. According to company officials, Germany, the UK and France performed particularly well. It is expecting Romania, and South Africa to contribute better figures next year.

Mr Singh said India, where Ranbaxy claims to have five per cent market share, was an important market. During the year, Ranbaxy increased its stake in Zenotech Laboratories for the company’s pipeline of biosimilars.

Patent challenges

Last year, the company also settled two patent challenges out of court with GlaxoSmithKline for its drug Valtrex, and with Boehringer Ingelheim and Astellas Pharma for the more than billion-dollar drug, Flomax.

Such “settlements enhance visibility and bring certainty of profit flow for the future,” said Mr Singh, promising to share similar news very soon.

On Thursday, shares of the company were down 2.85 per cent to about Rs 367.9 per share from the previous day’s close of Rs 378.7 per share.

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