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Pharma major Cipla has reported a 17 per cent decline in its consolidated net profit in the December quarter to ₹332 crore against the ₹401 crore reported in the same period last year.
Higher tax outgo coupled with a modest show in its key domestic market affected Cipla’s financials. The silver lining was its US operations, with sales recording growth for the second consecutive quarter.
The consolidated revenue from operation for the quarter came in at ₹4,008 crore — up 2 per cent against the ₹3,914 crore logged during the same period a year ago. Tax expenses for the quarter stood at ₹126 crore ( ₹64 crore).
Sales from India, which contributed around 40 per cent of the Cipla’s overall revenues, declined by one per cent year-on-year to ₹1,585 crore. This decline was mainly due to the new base post the GST-led inventory de-stocking and re-stocking, and the higher drug sales in the same quarter last year.
However, Cipla has continued its outperformance, growing by 12 per cent, bettering the industry growth rate of 10 per cent (as of December 2018), driven by both prescription and generics businesses. The company maintains its leading position in respiratory, inhalation, urology and CNS segments in the domestic market. Cipla continues to diversify and grow its domestic business through in-licensing deals.
Robust US business
Sales from North America — which contributed 21 per cent of the revenues — grew 18 per cent year-on-year. Its US business has witnessed a steady traction over the last two quarters, as there was a ramp-up in sales across key direct-to-market launches. The management has guided for 20+ filings every year, focussing on limited competition products. The near-term launches expected are Albuterol and Medroxyprogesterone.
In its Top 30 projects under development, Cipla highlighted 18 Para IV opportunities; around half of them are limited competition products in areas including respiratory, Anti-HIV and oncology.
The company’s operating profit stood at ₹720 crore during the quarter. The operating margin came in at 18 per cent, 300 basis points lower y-o-y, due to higher financial cost.
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