Dr Reddy's Q1 net profit rises 45% to Rs662.8cr on one-off gains
30 July 2019
Dr Reddy's Laboratories (DRL) has reported a net profit of Rs662.8 crore in the first quarter of the current fiscal ended 31 June 2019 - a 45 per cent year-on-year jump - on the back of a one-time gain of Rs350 crore from Celgene, pursuant to settlement agreement related to Revlimid brand capsules in Canada.
The pharma major had reported a consolidated net profit of Rs456 crore in the same period last year.
DRL said its revenue for the quarter grew three per cent YoY to Rs3,843.4 crore.
"This quarter we grew most of our key markets and hope to continue this momentum with a sharper focus on performance," GV Prasad, cCo-chairman and CEO, DRL, said. "We will continue our journey of operational excellence, cost leadership and innovation across our businesses," Prasad added.
DRL said global generics revenue, which contributed little over 80 per cent to the company’s total income, grew eight per cent to Rs3,298.2 crore.
North America, which is largely the US generics market, grew three per cent to Rs1,632.2 crore, helped by new products and increase in volumes, which was partly offset by price erosion and adverse foreign exchange movement.
The company launched five new products - Daptomycin, Testosterone gel, Tobramycin, Vitamin K and OTC calcium carbonate - and re-launched lsotretinoin during the quarter.
Revenue from emerging markets grew 10 per cent to Rs730 crore, with much of that accruing from Russia.
India business grew 15 per cent to Rs700 crore driven by volume traction and improved realisations in base business and new product launches.
Sales from Europe rose 19 per cent to Rs240 crore, primarily on account of new products and volume traction due to improvement in supplies.
Pharmaceutical Services and Active Ingredients (PSAI) revenues dropped 16 per cent to Rs450 crore due to decline in sales volume of certain products.
Sales in its proprietary products division fell 61 per cent to Rs28 crore as the company divested its key derma products.
DRL on Monday also elevated Erez Israeli as its chief executive officer, after GV Prasad, co-chairman and CEO of the company, decided to step aside as CEO in favour of Erez Israeli, the company’s COO.
Israeli will take over as CEO on 1 August. “I am not retiring and will be co-Chairman and Managing Director,” Reddy said, adding that Israeli will continue to report to him.
Israeli will report to GV Prasad, who has been re-designated from CEO to co-chairman and managing director of the cpmpany.
"Since joining Dr Reddy's as chief operating officer (COO) in April 2018, Erez has spearheaded the transformation agenda of the organisation by ensuring clear strategic focus, effective cost management setting foundations for sustainable performance and driving growth," Dr Reddy's said in a statement to stock exchanges.
"His appointment as a CEO will help to propel the organisation's growth agenda forward," the company added.