Wockhardt says derivative losses not to affect Q1 performance

Pharmaceutical and biotechnology company Wockhardt Ltd has denied that it was likely to suffer any adverse consequences in its first quarter 2008 financial results caused by the fluctuations in the derivatives market.

The pharmaceutical company says that it will neither incur any losses in the current quarter "nor will there be a situation of such losses to occur subsequently," due to any currency hedging operations, it said in a regulatory filing.

Wockhardt also said that its foreign currency convertible bond (FCCB) had been utilised solely for funding its acquisitions in Europe and the US, which accounted for 60 per cent of its revenue. It said that in order to manage the consequences of the considerable currency fluctuation in the last one year, it undertook business-hedging operations as a normal practice to protect itself from such currency fluctuations on a regular basis.
"Wockhardt has a highly professional and expert team that undertakes normal business related to hedging for the past few years," it said and added that its record of the last few years clearly demonstrated that there had been no losses whatsoever because of business related hedging activities.

It said that its consolidated profits for 2007 were Rs385.82 crore as against Rs241.25 crores in 2006, is a growth of 60 per cent over the previous year.

Wockhardt has global footprints including UK, France, Germany, Ireland and the US.