Pharma major Dr Reddy’s Laboratories reported a 45% increase in net profit to Rs485.2 crore for the December quarter, against Rs334.4 crore in the year-ago period, due to lower base and good operating income.
Revenues stood at Rs3,850 crore, against Rs3,806 crore, which is an increase of 1%. The firm had the benefit of lower tax outgo at Rs95.3 crore, against Rs260 crore in the corresponding quarter a year ago and had a saving of Rs93 crore due to reduction in the US federal income tax rate from 31% to 21%.
We continued to improve our performance in the third quarter of FY19, supported by significant growth in emerging markets and India, pickup in new product launches and improvements in cost structure. We are on track towards delivering sustainable and profitable growth, GV Prasad, chief executive and co-chairman, said. Incidentally, analysts had forecasted a lower-than-expected growth in India and a sharp price correction in the US, given the country s generic pricing trend. Eventuality of a lower-than-expected offtake in the US markets remained a concern for most of the pharma companies.
The company’s global generics business showed a 4% y-o-y growth to Rs3,135 crore, driven by Europe by 1%, India by 10%, and emerging markets grew by 31%. However, revenues from North America fell by 8% to Rs1,483.2 crore from last year, but sequentially the same increased by 4%. The growth was aided by higher volume offtake, launches and favourable forex offset by higher price erosion in some of the key molecules, Saumen Chakraborty, chief financial officer, said. Revenues from India stood at Rs670 crore, an year-on-year growth of 10%, primarily driven by volume traction and new products but a decline of 2% sequentially.
In the global generic segment, 10 products were launched and the firm has filed three Abbreviated New Drug Application with the US Food and Drug Administration during the quarter.