Last Thursday (20-Oct-2016), I did the Jul-Sep quarter results analysis for Biocon Ltd, for the organization I work for currently. Here is what I contributed:
Earnings Review: Biocon Jul-Sep PAT at 1.47 bln rupees
Bio-pharmaceutical company Biocon Ltd recorded a consolidated net profit of 1.47 bln rupees in Jul-Sep, the recorded as against a net loss of 106 mln rupees in the year-ago quarter. The profit growth was aided by a sharp rise in sales and lower raw material costs.
Consolidated net sales of Biocon grew nearly 20% on year to 9.40 bln rupees in the September quarter, driven by a steady 17.1% growth on year in revenues from its largest product segment of small molecules to 4.03 bln rupees and a sharp 34.4% on year increase in its biologics product sales to 1.56 bln rupees.
Biocon's revenues from research services and branded formulations business segments recorded year on year growth of near 16% and 14.5% to 3.03 bln rupees and 1.37 bln rupees respectively.
The company's net profit was in line with estimates. An average of estimates of nine brokerages had pegged the quarter's net profit at 1.46 bln rupees. Net sales was below the average estimate of 9.85 bln rupees.
Chairperson and managing director of Biocon, Kiran Mazumdar-Shaw was quoted in a company statement as saying that the company's performance in Jul-Sep was led by strong growth across all its verticals. "Expansion of our biologics footprint in emerging markets and licensing agreements boosted the revenue further," she said.
The growth in small molecules was driven by sales in emerging markets of Africa, West Asia and South America and to India based customers servicing the needs of the US market. Biologics vertical, the company said, saw strong growth of 26% at nearly one bln rupees on account of sales in emerging markets of Africa, West Asia and South America.
Operating margin of the biopharmaceuticals company jumped up to 25.2% in the September quarter from 21.2% in the year-ago quarter. The 400 bps rise in operating margin was chiefly due to a 6.3% fall on year in cost of material consumed to 3.18 bln rupees.
Total expenditure was up 13.7% on year to 7.82 bln rupees. Research and development expenses in the September quarter was 6.8% of sales, up from 5.3% in the June quarter.
Finance costs increased 2.2 times year on year to 65 mln rupees and the tax payment was 48% up on year at 417 mln rupees. 'Other income' was up 69% higher on year at 384 mln rupees in Jul-Sep.
Shaw said Biocon's insulin Glargine pen launched in Japan was well received in the September quarter with prescriptions beginning to gain traction. The quarter also saw the European drug regulator accept for review
Biocon's application to market its biosimilar Trastuzumab co-developed by Biocon and Mylan.
The company received a tentative approval from US FDA for its generic drug, Rosuvastatin Calcium tablets. The company also said that its facilities in India had completed regulatory audits by MCC South Africa and US FDA in the September quarter.
From the June quarter, Biocon's net profit was down 11.9% and its net sales was down 4.2%.