Piramal Healthcare (formerly known as Nicholas Piramal India Ltd) has failed to generate positive growth in bottom line during the second quarter ended September 2008 and its consolidated net profit declined by 13.4 per cent to Rs 73.39 crore from Rs 84.77 crore in the corresponding period of last year. This is mainly due to foreign exchange loss of Rs 40.81 crore and provision for VRS of Rs 9.55 crore. Further, interest cost also went up sharply by 53.4 per cent to Rs 17.03 crore. With fall in profits, its earnings per share for the quarter moved down to Rs 3.5 from Rs 4 in the last period.
The company's consolidated net sales improved by 17 per cent to Rs 884.25 crore from Rs 755.76 crore. The pharmaceutical sales increased by 15.8 per cent to Rs 844.61 crore from Rs 729.60 crore. With the de-merger of its R&D activities into a separate company, Piramal Healthcare has reduced its R&D expenditure by 45.4 per cent to Rs 23.08 crore from Rs 42.35 crore in the same period of last year. However, its employees cost increased by 10.1 per cent to Rs 142.08 crore from Rs 129.07 crore.
During the quarter under review, healthcare solution division achieved growth of 26.8 per cent with sales of Rs 45 crore. The company grew particularly well in the cardio-vascular, CNS, gastro-intestinal and ophthalmology therapy segments. Its pharma solutions division improved its sales by 8.5 per cent to Rs 28 crore. Piramal Healthcare is expanding its diagnostic services business through Piramal Diagnostic Pvt Ltd (earlier known as Wellspring). Revenues from this business increased by 45.5 per cent to Rs 45.36 crore from Rs 31.17 crore in the corresponding period of last year.
For the first six months ended September 2008, the company's consolidated net profit improved by 10.4 per cent to Rs 141.48 crore from Rs 128.20 crore in the similar period of last year and its net sales moved up by 17.2 per cent to Rs 1588.56 crore from Rs 1355.38 crore. The EPS worked out to Rs 6.8 as against Rs 6.1 in the last period.