Aurobindo Pharma, the fourth largest Hyderabad-based pharma company, suffered a heavy setback during the first quarter ended June 2004 mainly due to volatile foreign exchange rates, higher interest cost as well as staff cost, lower exports and lower than expected sales growth. The company's net profit declined by 21.8 per cent to Rs 18.02 crore from Rs 23.05 crore in the corresponding period of last year. This resulted in lower earning per share of Rs 3.55 as against Rs 4.96.

The company's sales declined by 6.8 per cent to Rs 284.93 crore from Rs 305.87 crore. Though the cost of consumption of raw material declined to Rs 171 crore from Rs 207 crore, its staff cost went up sharply by 43 per cent to Rs 15.95 crore from Rs 11.15 crore in the similar period of last year. The profit before depreciation, interest & tax declined by 6.6 per cent to Rs 42.04 crore from Rs 45.02 crore in the last period. The interest burden went up by 22.7 per cent to Rs 7.36 crore from 6.0 crore.

The company incurred an exchange rate fluctuation loss of Rs 8.23 crore during the period under review as against a gain of Rs 3.90 crore in Q1 of FY 03-04. Its exports on FOB value basis declined to Rs 129.45 crore from Rs 144.96 crore. Aurobindo has received USFDA approval for its API and formulation facilities.