HYDERABAD, India
Dr. Reddy’s Laboratories Ltd. (NYSE: RDY | BSE: 500124 | NSE: DRREDDY) today announced its consolidated financial results for the first quarter ended June 30, 2017 under International Financial Reporting Standards (IFRS).
Q1 FY18: Key Highlights
- Consolidated Revenues at Rs. 33.2 billion, year-on-year growth of 3%
- Gross Profit Margin at 51.6%, declined ~460 bps over last year
- Research & Development (R&D) spend at Rs. 5.1 billion, 15.3% of Revenues
- Selling, general & administrative (SG&A) expenses at Rs. 11.8 billion, year on year decline of 4%
- EBITDA at Rs. 3.4 billion, 10.1% of Revenues
- Profit after tax at Rs. 0.6 billion, 1.8% of Revenues
Commenting on the results, G V Prasad, Co-Chairman and CEO said, “Our first quarter’s results of FY 18 have been below expectations. While headwinds in the form of price erosion due to U.S. customer consolidation continue, a lower contribution from new product launches in the U.S. and the GST implementation in India also impacted our performance.
On the positive side, we have progressed on our quality journey and have had several successful inspections. We continue to focus on strengthening our manufacturing & quality systems, revitalizing growth and creating a leaner and agile organization.”
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All amounts in millions, except EPS |
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All US dollar amounts based on convenience translation rate of I USD = Rs. 64.62 |
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Dr. Reddy’s Laboratories Limited and Subsidiaries |
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Consolidated Income Statement |
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| Particulars | Q1 FY 18 | Q1 FY 17 |
Growth |
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| ($ | ) | (Rs.) | % | ($ | ) | (Rs.) | % | ||||||||||||||
| Revenues | 513 | 33,159 | 100.0 | 501 | 32,345 | 100.0 | 3 | ||||||||||||||
| Cost of revenues | 249 | 16,062 | 48.4 | 219 | 14,167 | 43.8 | 13 | ||||||||||||||
| Gross profit | 265 | 17,097 | 51.6 | 281 | 18,178 | 56.2 | (6 | ) | |||||||||||||
| Operating Expenses | |||||||||||||||||||||
| Selling, general & administrative expenses | 182 | 11,763 | 35.5 | 190 | 12,284 | 38.0 | (4 | ) | |||||||||||||
| Research and development expenses | 79 | 5,075 | 15.3 | 74 | 4,802 | 14.8 | 6 | ||||||||||||||
| Other operating expense / (income) | (3 | ) | (194 | ) | (0.6 | ) | -1 | (96 | ) | (0.3 | ) | 102 | |||||||||
| Results from operating activities | 7 | 453 | 1.4 | 18 | 1,188 | 3.7 | (62 | ) | |||||||||||||
| Finance expense / (income), net | (3 | ) | (221 | ) | (0.7 | ) | -7 | (445 | ) | (1.4 | ) | (50 | ) | ||||||||
| Share of (profit) of equity accounted investees, net of income tax | (2 | ) | (98 | ) | (0.3 | ) | -1 | (74 | ) | (0.2 | ) | 33 | |||||||||
| Profit before income tax | 12 | 772 | 2.3 | 26 | 1,707 | 5.3 | (55 | ) | |||||||||||||
| Income tax expense | 3 | 181 | 0.5 | 7 | 444 | 1.4 | (59 | ) | |||||||||||||
| Profit for the period | 9 | 591 | 1.8 | 20 | 1,263 | 3.9 | (53 | ) | |||||||||||||
| Diluted EPS | 0.06 | 3.56 | 0.12 | 7.43 | (52 | ) | |||||||||||||||
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EBITDA Computation |
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| Particulars | Q1 FY 18 | Q1 FY 17 | ||||||||||||||||
| ($ | ) | (Rs.) | ($ | ) | (Rs.) | |||||||||||||
| Profit before income tax | 12 | 772 | 26 | 1,707 | ||||||||||||||
| Interest (income) / expense net* | (3 | ) | (211 | ) | (6 | ) | (409 | ) | ||||||||||
| Depreciation | 31 | 2,008 | 27 | 1,760 | ||||||||||||||
| Amortization | 12 | 791 | 14 | 921 | ||||||||||||||
| EBITDA | 52 | 3,360 | 62 | 3,979 | ||||||||||||||
| EBITDA (% to Revenues) | 10.1 | 12.3 | ||||||||||||||||
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* Includes income from investments |
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Key Balance Sheet Items |
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| Particulars | As on 30th June 17 | As on 31st March 17 | ||||||||||||
| ($) | (Rs.) | ($) | (Rs.) | |||||||||||
| Cash and cash equivalents and Other current Investments | 226 | 14,572 | 281 | 18,136 | ||||||||||
| Trade receivables | 637 | 41,140 | 589 | 38,065 | ||||||||||
| Inventories | 435 | 28,095 | 441 | 28,529 | ||||||||||
| Property, plant and equipment | 892 | 57,611 | 885 | 57,160 | ||||||||||
| Goodwill and Other Intangible assets | 752 | 48,564 | 753 | 48,677 | ||||||||||
| Loans and borrowings (current & non-current) | 781 | 50,462 | 761 | 49,185 | ||||||||||
| Trade payables | 205 | 13,225 | 208 | 13,417 | ||||||||||
| Equity | 1,910 | 1,23,423 | 1,920 | 1,24,044 | ||||||||||
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Revenue Mix by Segment |
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| Particulars | Q1 FY 18 | Q1 FY 17 |
Growth |
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| ($ | ) | (Rs.) | % | ($ | ) | (Rs.) | % | |||||||||||||||||
| Global Generics | 425 | 27,455 | 83 | 412 | 26,638 | 82 | 3 | |||||||||||||||||
| North America | 14,946 | 15,523 | (4 | ) | ||||||||||||||||||||
| Europe* | 2,075 | 1,615 | 28 | |||||||||||||||||||||
| India | 4,687 | 5,223 | (10 | ) | ||||||||||||||||||||
| Emerging Markets# | 5,747 | |||||||||||||||||||||||