Biocon has suffered a setback during the third quarter ended December 2017 and its consolidated net profit declined sharply by 46.4 per cent to Rs.92 crore from Rs.171 crore in the corresponding period of last year due to stagnant sales, pricing pressures and channel consolidation in the US.
EBITDA also declined by 21 per cent to Rs.256 crore from Rs.324 crore. Its consolidated net sales improved only by 1.3 per cent to Rs.1,058 crore from Rs.1,044 crore. Its licensing income declined to Rs.12 crore from Rs.79 crore and other income declined by 28 per cent to Rs.34 crore from Rs.48 crore. With lower net profit, EPS declined to Rs.1.56 from Rs.2.91. The company issued bonus shares in the ratio of 2:1 during June 2017 and its equity capital increased to Rs.300 crore from Rs.100 crore.
Due to lower profit and stagnant sales, Biocon share opened lower at Rs.602.65 on BSE today as compared to close of Rs.634.60 yesterday. Currently, Biocon scrip is moving at Rs.609.10, a degrowth of over 4 per cent. The scrip touched to its yearly peak level at 657.75 on January 24, 2018.
The sales of small molecules declined by 9 per cent to Rs.369 crore from Rs.407 crore in the corresponding quarter of last year and that of Biologics declined by 15 per cent to Rs.190 crore from Rs.222 crore. The sales of branded formulations increased by 27 per cent to Rs.156 crore from Rs.123 crore and income from research services moved up by 17 per cent to Rs.388 crore from Rs.332 crore. Its gross R&D expenditure declined to Rs.94 crore from Rs.100 crore.
Kiran Mazumdar-Shaw, chairperson and managing director, said, “This has been a significant quarter for Biocon as we crossed a major milestone of obtaining US FDA approval for biosimilar Trastuzumab partnered with Mylan. Another highlight was the announcement of a new strategic partnership with Sandoz to develop, manufacture and commercialize a portfolio of next wave of biosimilars for global markets.”
During the nine months period ended December 2017, the sales of small molecules declined by 13 per cent to Rs.1,082 crore from Rs.1,246 crore in the corresponding period of last year and that of biologics de-grew by 2 per cent to Rs.529 crore from Rs.539 crore. The sales of branded formulations, however, improved by 11 per cent to Rs.462 crore from Rs.418 crore and that of research services moved up by 11 per cent to Rs.1,014 crore from Rs.910 crore.
Biocon's research and development expenses declined by 18 per cent to Rs.165 crore during first nine months ended December 2017 from Rs.201 crore. Its interest burden went up by 112 per cent to Rs.45 crore from Rs.21 crore and depreciation provision increased by 42 per cent to Rs.290 crore from Rs.205 crore. EPS for the nine months period, after considering higher equity capital, worked out to Rs.4.10 as against Rs.8.23 in the last period.
The company's German based wholly-owned subsidiary betapharm Arzneimittel GmbH gone through re-inspection by German Regulator and received approval for restart of dispatch of products to the European Union.